Global Finance News
06 May 2026, 15:30
Disney Surges 7% as Streaming Profits Soar and Zootopia 2 Drives Blockbuster Quarter
May 6, 2026 · Earnings Report
Walt Disney shares jumped 7% today after the entertainment giant reported fiscal second quarter 2026 results that beat expectations across its three business segments, with streaming finally delivering the kind of profitability investors have been waiting years to see.
Total revenues for the quarter ended March 28, 2026 rose 7% to $25.2 billion from $23.6 billion in the same period a year ago. Income before income taxes climbed 9% to $3.4 billion. Total segment operating income grew 4% to $4.6 billion. GAAP diluted EPS fell to $1.27 from $1.81, largely due to tax-related items, but adjusted EPS rose 8% to $1.57 from $1.45, the figure investors focus on most closely.
The Entertainment segment was the standout, with revenues up 10% to $11.7 billion and operating income rising 6% to $1.34 billion. The most telling number was Entertainment SVOD operating income, which nearly doubled to $582 million from $310 million a year ago, pushing the streaming business past a double-digit operating margin for the first time. The quarter benefited from the continued performance of Zootopia 2, which generated $1.9 billion in global box office and drove the Zootopia franchise past 1 billion hours streamed on Disney+. The film became the highest grossing foreign film of all time in China, where Zootopia Land remains a major draw at Shanghai Disneyland.
The Experiences segment posted fiscal second quarter records in both revenue and operating income, with revenues up 7% to $9.5 billion and operating income up 5% to $2.6 billion. Per capita spending at domestic parks rose 5%, driven by admissions, food and beverage, and merchandise. The quarter also included the March launch of the Disney Adventure cruise ship in Singapore, where bookings have been strong, and the opening of World of Frozen at Disneyland Paris. Global guest attendance across parks and cruises grew 2%, though domestic park attendance dipped 1% due partly to softer international visitation.
The Sports segment saw revenues rise 2% to $4.6 billion, though operating income declined 5% to $652 million due to higher rights fees tied to new contract agreements. ESPN retained the largest share of linear sports consumption in the US despite competing with the Super Bowl and the Olympics during the quarter. ESPN Men's Tournament Challenge attracted 27 million completed brackets, an all-time record.
CEO Josh D'Amaro and CFO Hugh Johnston raised the company's full year fiscal 2026 adjusted EPS growth outlook to approximately 12% excluding the 53rd week, or approximately 16% including it. Third quarter segment operating income is expected to reach approximately $5.3 billion. The company is targeting at least $8 billion in share repurchases in fiscal 2026 and continues to expect double-digit adjusted EPS growth in fiscal 2027. Coming up in the release slate are The Mandalorian and Grogu, Toy Story 5, and a live-action Moana, all of which are expected to fuel the company's broader franchise ecosystem across streaming, parks, consumer products and games.
For a company that was long criticized for sacrificing profitability in the pursuit of streaming subscribers, the first double-digit streaming operating margin marks a meaningful inflection point, and the market's 7% reaction suggests investors believe Disney has finally turned the corner.
May 6, 2026 · Earnings Report
Walt Disney shares jumped 7% today after the entertainment giant reported fiscal second quarter 2026 results that beat expectations across its three business segments, with streaming finally delivering the kind of profitability investors have been waiting years to see.
Total revenues for the quarter ended March 28, 2026 rose 7% to $25.2 billion from $23.6 billion in the same period a year ago. Income before income taxes climbed 9% to $3.4 billion. Total segment operating income grew 4% to $4.6 billion. GAAP diluted EPS fell to $1.27 from $1.81, largely due to tax-related items, but adjusted EPS rose 8% to $1.57 from $1.45, the figure investors focus on most closely.
The Entertainment segment was the standout, with revenues up 10% to $11.7 billion and operating income rising 6% to $1.34 billion. The most telling number was Entertainment SVOD operating income, which nearly doubled to $582 million from $310 million a year ago, pushing the streaming business past a double-digit operating margin for the first time. The quarter benefited from the continued performance of Zootopia 2, which generated $1.9 billion in global box office and drove the Zootopia franchise past 1 billion hours streamed on Disney+. The film became the highest grossing foreign film of all time in China, where Zootopia Land remains a major draw at Shanghai Disneyland.
The Experiences segment posted fiscal second quarter records in both revenue and operating income, with revenues up 7% to $9.5 billion and operating income up 5% to $2.6 billion. Per capita spending at domestic parks rose 5%, driven by admissions, food and beverage, and merchandise. The quarter also included the March launch of the Disney Adventure cruise ship in Singapore, where bookings have been strong, and the opening of World of Frozen at Disneyland Paris. Global guest attendance across parks and cruises grew 2%, though domestic park attendance dipped 1% due partly to softer international visitation.
The Sports segment saw revenues rise 2% to $4.6 billion, though operating income declined 5% to $652 million due to higher rights fees tied to new contract agreements. ESPN retained the largest share of linear sports consumption in the US despite competing with the Super Bowl and the Olympics during the quarter. ESPN Men's Tournament Challenge attracted 27 million completed brackets, an all-time record.
CEO Josh D'Amaro and CFO Hugh Johnston raised the company's full year fiscal 2026 adjusted EPS growth outlook to approximately 12% excluding the 53rd week, or approximately 16% including it. Third quarter segment operating income is expected to reach approximately $5.3 billion. The company is targeting at least $8 billion in share repurchases in fiscal 2026 and continues to expect double-digit adjusted EPS growth in fiscal 2027. Coming up in the release slate are The Mandalorian and Grogu, Toy Story 5, and a live-action Moana, all of which are expected to fuel the company's broader franchise ecosystem across streaming, parks, consumer products and games.
For a company that was long criticized for sacrificing profitability in the pursuit of streaming subscribers, the first double-digit streaming operating margin marks a meaningful inflection point, and the market's 7% reaction suggests investors believe Disney has finally turned the corner.
