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Walt Disney Company (NYSE:DIS) rose 1.6% in premarket Thursday, cutting losses that followed immediately after the earnings report.
Disney reported adjusted EPS of $1.03, compared with Wall Street estimates of $0.99, while revenue of $22.33 billion missed estimates of $22.49 billion.
Disney’s parks business saw revenue climb 13% to $8.33 billion in Q3 from the year-ago period.
Disney+ subscribers fell to 146.1 million, missing estimates of 151.1 million, pressured by a 24% fall in Disney+ Hotstar subscribers.
Disney said that it would be raising the prices of its streaming streaming services including Disney+ and Hulu, but will keep prices of its ad-supported tiers of streaming unchanged.
The price of the ad-free tier of Disney+ will increase to $13.99 from $10.99 starting Oct. 12, but the ad-supported Disney+ will remain at $7.99 The company also announced that it would expand its ad-supported offering in Europe and Canada starting Nov. 1.
Disney also said it would launch a new premium duo bundle on Sept. 6, for users who want ad-free tiers of both Disney+ and Hulu at $19.00 per month. The price for all three streaming products, or the “Trio Premium,” including Disney+, Hulu, and the ad-supported tier ESPN+ will increase to $24.99 per month from $19.99 per month.
Citi analysts said the results were “in-line” with expectations. BofA analysts are “confident in Bob Iger’s ability to navigate the company through this transition period,” despite several strategic questions that still remain.
“DIS has a collection of best-in-class premiere assets (in content/IP as well as Theme Parks). Near term catalysts include: (1) additional updates on the strategic outlook (including potentially rationalizing the asset base) for DIS with a positive message likely at the Analyst event in September and (2) upside to initial cost saving plans,” the analysts wrote.
(Additional reporting by Senad Karaahmetovic)
