Is Now The Time to Buy Disney Stock?

On Tuesday, November 8th, Disney, Inc. (DIS) released Q4 2022 earnings results.  The company reported top-line revenue for the quarter of $20.15 billion, up 9% year-over-year.

As a Wealthy Investor here’s what you need to know:

Disney derives its revenue from 2 primary segments: their Parks & Experiences segment and their Media & Entertainment Distribution segment.

Parks & Experiences revenue (which includes theme parks, resorts, cruise line and merchandise business) for the quarter was $7.4 billion, up more than 35% from last year.  Disney’s domestic theme parks revenue rose 44%, with international attractions climbing 55%.

Revenue for the Media & Entertainment Distribution segment (which includes their streaming services) was $12.7 billion, down 3% year-over-year.

Direct-to-Consumer streaming services revenue for the quarter increased 8% year-over-year to $4.9 billion.

Across Disney's streaming services, Disney+, Hulu and ESPN+ had a combined total of 235.7 million subscribers, up from 221 million in the third quarter.

Disney's total subscribers of 235.7 million put them ahead of the 223.1 million subscribers last tallied by Netflix.

The problem for Disney is that in order to compete with Netflix, acquiring those subscribers cost them significantly.  These expenses included higher programming and production costs, increases in marketing and technology costs.

Their operating loss (the amount in which a company's operating expenses exceed their gross profits) for the quarter, more than doubled, up 134% over the past year, for a total of $1.5 billion.

Disney+ may have more subscribers than Netflix, but does that make Disney more profitable when it comes to streaming?

The answer is definitely no.

Disney+ had an operating loss of $1.5 billion for this past quarter, while Netflix had operating income of $1.5 billion for the quarter.

Because Disney stock is not in favor with Wall Street institutions I do not recommend Disney shares as a buy or long-term hold.

Disney 5 Year Chart

In this episode of Wealthy Investor TV I sit down with Carrie Keranen to discuss stock market trading strategies that work. Carrie also discuss how she learned to emotionally embrace stock market trading success.