Disney Q2 Revenue Up 45% YoY... Streaming and Amusement Parks Show Strong Performance

Streaming Revenue Up 57%... Continuous Subscriber Inflow
Theme Park and Merchandise Sales Soar 307%
Lifted Sales Due to Easing of Lockdown Measures in the US

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] Walt Disney's Q2 revenue surged 45% year-on-year, significantly exceeding market expectations. Analysts attribute the revenue boost to increased earnings from Disney's own streaming service, Disney Plus (+), alongside a rise in theme park visitors following the lifting of COVID-19 lockdown measures.

On the 12th (local time), Walt Disney announced its Q2 (Disney's own Q3) earnings reflecting these results.

According to Disney, Q2 revenue reached $17 billion (approximately 20 trillion KRW), surpassing the market forecast of $16.7 billion (approximately 19 trillion KRW).

Net income for the period was $918 million (approximately 1 trillion KRW), turning profitable from a loss of $4.721 billion (approximately 5 trillion KRW) in the same period last year.

Earnings per share stood at 80 cents, exceeding Wall Street's expected 55 cents.

This improvement in profitability is analyzed to be driven by the continuous increase in subscribers to the streaming service.

[Image source=Reuters Yonhap News]

As of Q2, Disney Plus's total subscriber count reached 116 million, surpassing the market expectation of 114.5 million. This is an increase of over 10 million compared to the 103.6 million subscribers in Q1.

Including Hulu and ESPN+, the total number of subscribers amounts to 174 million.

Thanks to this subscriber growth, the direct-to-consumer (DTC) segment responsible for streaming services recorded revenue of $4.3 billion (approximately 5 trillion KRW), a 57% increase from $2.7 billion in the same period last year.

However, monthly revenue per subscriber declined by 10% year-on-year to $4.16. This is attributed to Disney offering its other streaming service, Hotstar, at a lower price in India and Indonesia.

The turnaround to profitability in the theme park and merchandise sales segment also helped boost Disney's revenue and operating profit.

According to Disney, the theme park business segment, which includes Disneyland and merchandise sales, generated $4.3 billion (approximately 5 trillion KRW) in revenue, a 307% increase compared to the same period last year.

[Image source=AP Yonhap News]

Additionally, it posted an operating profit of $356 million (approximately 410 billion KRW), turning profitable from an operating loss of $1.878 billion (approximately 2.2 trillion KRW) recorded last year.

This is interpreted as most Disneylands reopening from Q2 following the lifting of COVID-19 lockdowns in the U.S., leading to increased visitors and higher merchandise sales.

However, Disneylands in overseas regions remain either closed or affected by local lockdown measures, resulting in a loss of $210 million (approximately 245 billion KRW).

Foreign media analyzed that the revival of the tourism industry will be key to Disney's profitability improvement.

Disney also operates hotels, resorts, and cruise businesses in addition to Disneyland, so profits are highly sensitive to tourism trends.

In 2019, Disney's theme park, hotel, and cruise business segments accounted for 37% of total revenue, making these segments core sources of Disney's income.

Meanwhile, following the earnings announcement, Disney's stock price rose 5.17% to $188.56 in after-hours trading after the New York Stock Exchange closed.

This content was produced with the assistance of AI translation services.