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Q1 adjusted EPS up 44% to $1.76, tops analyst estimates

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Disney ( DIS ) reaffirms forecast of high single-digit earnings

growth

in fiscal 2025

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Flagship Disney+ streaming service sheds about 1 million

subscribers following price increase

By Dawn Chmielewski and Lisa Richwine

Feb 5 (Reuters) - Walt Disney ( DIS ) sharply

outperformed Wall Street's quarterly earnings estimates on

Wednesday, with results buoyed by the strong holiday box office

performance of animated sequel "Moana 2" and higher profits at

the company's streaming business.

The strength in entertainment helped offset a decline at

Disney's ( DIS ) domestic theme parks, which were impacted by hurricanes

Helene and Milton in Florida. The parks-led Experiences group

also incurred about $75 million in expenses associated with the

December launch of the Disney Treasure cruise ship.

Disney ( DIS ) reported a 44% jump in adjusted per-share earnings of

$1.76 for the quarter that ended in December, exceeding the

$1.45 per share earnings consensus estimate of 24 analysts

surveyed by LSEG.

Revenue for the quarter rose 5% to $24.69 billion, slightly

ahead of analysts' projections of $24.62 billion. Operating

income rose 31% from a year earlier to $5.1 billion.

"Overall, this quarter proved to be a strong start to the

fiscal year, and we remain confident in our strategy for

continued growth," Disney ( DIS ) CEO Bob Iger said in a statement.

Looking ahead, Disney ( DIS ) forecast "high single digit" adjusted

earnings-per-share growth in fiscal 2025 compared with the prior

year and an increase of approximately $875 million in operating

income at the streaming entertainment unit.

The company said it would incur $50 million in costs

associated with exiting its Venu Sports joint venture with

Warner Bros Discovery ( WBD ) and Fox. The media

companies abandoned their plans for a sports streaming service

in January, after it ran into substantial legal opposition.

Operating income at Disney's ( DIS ) Entertainment unit, which

includes film, television and streaming, increased to $1.7

billion in the quarter, nearly double the results from a year

earlier, thanks in part to the strong performance of "Moana 2."

The animated sequel topped $1 billion in box office proceeds

over the Martin Luther King Jr. Day weekend in January, becoming

the fourth Walt Disney Animation film to reach that financial

milestone.

Disney's ( DIS ) traditional television business continued to erode.

Operating income at so-called linear networks fell 11% to $1.1

billion.

Subscribers for the company's flagship streaming video

service, Disney+, slipped 1% from the prior quarter to 124.6

million. The company had warned of a modest drop in subscribers

because of a price increase that took effect in October. It also

forecast a modest decline in Disney+ subscribers in the second

quarter, compared to the first.

Disney+, Hulu and ESPN+ produced an operating profit of

$293 million in the quarter, marking the third straight quarter

of profitability and a turnaround from the year-ago loss of $138

million.

In the Experiences segment, which includes consumer products

and the cruise line, as well as parks, operating income was

roughly flat at $3.1 billion. Profit declined 5% at domestic

parks because the hurricanes and cruise ship costs, while

operating income at international parks rose 28% from a year

ago.

At the Sports unit, which includes the ESPN ( DIS ) network and Star

India business, operating income was $247 million, compared with

a year-ago loss, in part reflecting improvement in Star India's

operating results ahead of Disney ( DIS ) and Reliance Industries

completing a deal to combine their Indian media assets.