Disney falls short of expectations – the stock tumbles in the after-hours

The Walt Disney Company (NYSE: DIS) reported the latest financial results for the fourth quarter and fiscal year ended October 1, 2022, after the closing bell in the US on Tuesday.

The biggest entertainment company in the world missed both revenue and earnings per share estimates (EPS) for the quarter.

The company reported revenue of $20.15 billion for the quarter (up by 9% year-over-year) vs. the $21.268 billion estimate.

EPS reported at $0.30 per share (down by 19% year-over-year) vs. the $0.558 per share expected.

Revenue reached $82.722 billion for the fiscal year that ended October 1, 2022 – up 23% from the previous year. EPS reported at $3.53% per share, up by 54% from 2021.

”2022 was a strong year for Disney, with some of our best storytelling yet, record results at our Parks, Experiences and Products segment, and outstanding subscriber growth at our direct-to-consumer services, which added nearly 57 million subscriptions this year for a total of more than 235 million,” Bob Chapek, CEO of Disney said in a press release.

”Our fourth quarter saw strong subscription growth with the addition of 14.6 million total subscriptions, including 12.1 million Disney+ subscribers. The rapid growth of Disney+ in just three years since launch is a direct result of our strategic decision to invest heavily in creating incredible content and rolling out the service internationally, and we expect our DTC operating losses to narrow going forward and that Disney+ will still achieve profitability in fiscal 2024, assuming we do not see a meaningful shift in the economic climate. By realigning our costs and realizing the benefits of price increases and our Disney+ ad-supported tier coming December 8, we believe we will be on the path to achieve a profitable streaming business that will drive continued growth and generate shareholder value long into the future. And as we embark on Disney’s second century in 2023, I am filled with optimism that this iconic company’s best days still lie ahead,” Chapek added.

Shares of Disney were little changed at the end of the day on Tuesday, down by 0.53% at $99.94 a share.

The stock fell by around 9% in the after-hours trading after missing Wall Street estimates for the previous quarter.

Stock performance

• 1 month: +7.30%
• 3 months: -7.61%
• Year-to-date: -35.50%
• 1 year: -42.95%

Walt Disney price targets

• Keybanc: $143
• UBS: $135
• Rosenblatt: $134
• JP Morgan: $145
• B of A Securities: $127
• Arete Research: $263
• Credit Suisse: $157
• Wells Fargo: $145
• Goldman Sachs: $140

Walt Disney is the 50^th largest company in the world with a market cap of $182.12 billion.

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Sources: The Walt Disney Company, TradingView, Benzinga, CompaniesMarketCap