Disney Q3 Earnings: Parks Challenges and Subscription Strength

Updatea year ago
On Tuesday after hours, Disney stock rose 4% after reporting a mixed Q3 earnings
Revenue fell 5% short of analyst estimates, while expectations for an EPS loss were conversely met with profits, primarily driven by better-than-expected profits on the media/network side of the business
The company was most dramatically impacted in its parks and experiences segment, which saw a $3.5 billion adverse impact from COVID-19
However other segments of the business fared better, with Disney+ now surpassing 60 million subscribers - the bottom end of the subscriber range the company had initially targeted to reach by 2024.
On the investor call, management announced that its upcoming Mulan film would mostly bypass theaters and instead premier directly on Disney+ for a $30 "premiere access" fee
At over 4 months of a monthly Disney+ subscription, the $30 price point certainly feels jarring at first glance - but we see it as likely having been based on a per-household-viewing basis
While this arrangement was framed as a one-off event given the current environment, we see this as a bold test of the pricing power of Disney's IP assets
As of this writing, DIS was a portfolio holding of Titan. This security may cease to be a portfolio holding at some point in the future.

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