The Walt Disney Co saw higher profits and revenue in its fiscal second quarter, thanks to ongoing strength at its theme parks and an improving streaming business. However, Disney+ lost four million subscribers, and its shares dropped 4.5% in after-hours trading. Hulu subscribers were nearly the same as last quarter at 48.2 million. In response, Disney plans to merge the two services into one app. The company is also reorganizing with a target of $5.5 billion in cost savings, and the result is around 7,000 job cuts.
Bob Iger returned to the CEO post from Bob Chapek in November, and has since been focusing on turning around the streaming business, all while ensuring the financial stability of Disney’s theme parks. Additionally, Iger has had to protect Disney World from a takeover by Florida Governor Ron DeSantis, leading to a lawsuit from Disney in late April.
In the three months ending April 1st, Disney earned $1.27 billion or 69 cents per share, meaning a 26 cents per share increase from a year ago. After adjusting for one-time items, their earnings matched analyst expectations of 93 cents per share. Revenue also rose 13% to $21.82 billion, meeting Wall Street predictions. Sales in the Parks, Experiences and Products segment grew 17%, while revenue in the Movies unit saw a 3% growth. In the previous quarter, the Parks, Experiences and Products division saw a 21% increase, while Movies revenue rose by 1%.
In order to strengthen its brand and reconnect with theme park diehards, Iger has been implementing changes at US parks. On Monday, Disney announced plans for 2021, including the return of Disney dining plans, and certain days where annual passholders and Disney cast members can visit the parks without a reservation. Despite these efforts, Disney’s stock dropped $4.69, or 4.6%, to $96.45 in after-hours trading.
