Walt Disney Co. (DIS) shares climbed 4.0% to $115.90 on Wednesday after the entertainment giant reported fiscal second-quarter results that beat estimates across all three business segments. Revenue of $25.17 billion topped the $24.85 billion consensus by $320 million, while adjusted earnings per share of $1.57 exceeded the $1.44 estimate by 9.0%.
The standout was Disney's entertainment segment, which surged 10% year-over-year to $11.72 billion in revenue. Within that segment, streaming revenue grew 13% sequentially — an acceleration from 11% growth in the prior quarter — as Disney+ subscribers rose to 173 million globally, up from 167 million at the end of Q1. Combined streaming operating income (Disney+, Hulu, ESPN+) reached $423 million, compared to a $147 million loss in the year-ago quarter.
Streaming Profitability Milestone
CEO Bob Iger highlighted that streaming profitability 'has arrived faster than our original timeline' and raised the full-year streaming profit target to $1.5 billion from $1.2 billion. Average revenue per user (ARPU) for Disney+ in the US rose to $9.42 from $8.99, driven by the September 2025 price increase and growing ad-tier adoption. The ad-supported tier now accounts for 48% of new Disney+ sign-ups in North America.
Experiences Segment Hits Record
Disney Experiences — encompassing theme parks, cruise lines, and consumer products — posted revenue of $9.18 billion, up 7% year-over-year and a record for a fiscal second quarter. Operating income for the segment rose 11% to $2.67 billion. Domestic parks revenue grew 5% on higher per-capita spending despite flat attendance, while international parks revenue surged 14% as Shanghai Disneyland and Disneyland Paris benefited from expanded attractions.
The company confirmed its fourth cruise ship, Disney Destiny, remains on track for a November 2026 maiden voyage. CFO Hugh Johnston noted that the cruise line business is now generating 'mid-teens operating margins' and is Disney's fastest-growing experience category.
Full-Year Guidance Raised
Disney raised its full-year adjusted EPS growth guidance to 12% from the prior range of 8-10%, implying adjusted EPS of approximately $5.95 for fiscal 2026. The company also increased its capital expenditure forecast to $10.5 billion from $10 billion, with the incremental spending directed toward theme park expansions in Florida and a new attraction in Tokyo.