Disney(US:DIS)2024-08-07 10:54Financial Performance - Net income for the quarter ended July 1, 2023, was $(153) million, compared to $2,842 million for the same quarter in the previous year[7]. - Comprehensive income attributable to Disney for the nine months ended June 29, 2024, was $4,350 million, up from $1,796 million for the same period last year[7]. - Comprehensive income for the quarter ended June 29, 2024, was $2,922 million, reflecting an increase from the previous quarter's comprehensive income of $2,676 million[13]. - The company reported a net income of $6,621 million for the nine months ended June 29, 2024, compared to $3,762 million for the same period in the prior year, representing a 76% increase[150]. - Net income attributable to Disney for the nine-month period increased $2.4 billion to $4.5 billion; EPS increased to $2.46 from $1.14 in the prior-year period[134]. Revenue and Growth - Total revenues for the nine months ended June 29, 2024, were $68,787 million, compared to $67,657 million in the prior year, reflecting a growth of 1.7%[27]. - Total revenues for the quarter ended June 29, 2024, were $23.155 billion, an increase from $22.330 billion for the quarter ended July 1, 2023, representing a growth of 3.7%[37]. - Total segment revenues for the quarter ended June 29, 2024, were $23,155 million, an increase from $22,330 million in the same quarter last year, representing a growth of 3.7%[27]. - Direct-to-Consumer revenues grew by 15% to $5,805 million for the quarter ended June 29, 2024, driven by subscription revenue growth[157]. - Total revenues for Content Sales/Licensing decreased to $2,112 million from $2,210 million, a 4% decline[3]. Expenses and Costs - Total produced and licensed content costs for the quarter ended June 29, 2024, were $6,197 million, compared to $6,088 million for the quarter ended July 1, 2023, reflecting a 1.8% increase[64]. - Cost of services for the quarter increased 2%, or $0.3 billion, to $13.2 billion due to higher sports programming and production costs[123]. - Total operating expenses for ESPN rose by 10% from $3,164 million to $3,482 million[203]. - Total programming and production costs decreased by 11% to $984 million for the quarter ended June 29, 2024, compared to $1,105 million for the prior year[165]. Assets and Liabilities - Total current assets decreased from $32,763 million as of September 30, 2023, to $25,493 million as of June 29, 2024[8]. - Total assets decreased from $205,579 million as of September 30, 2023, to $197,772 million as of June 29, 2024[8]. - Total liabilities decreased from $101,622 million as of September 30, 2023, to $92,469 million as of June 29, 2024[8]. - Cash and cash equivalents decreased from $14,182 million as of September 30, 2023, to $5,954 million as of June 29, 2024[8]. Shareholder Returns - The company repurchased $2,523 million of common stock during the financing activities for the nine months ended June 29, 2024[10]. - Common stock repurchases for the quarter totaled $1,522 million, indicating a significant return of capital to shareholders[13]. - The company paid dividends totaling $5 million during the quarter, consistent with its commitment to return value to shareholders[13]. - The Board of Directors declared a cash dividend of $0.30 per share ($0.5 billion) for the second half of fiscal 2023, and $0.45 per share ($0.8 billion) for the first half of fiscal 2024[73]. Segment Performance - The Entertainment segment reported an operating income of $1,201 million for the quarter, a substantial increase from $408 million in the prior year, marking a growth of 194.6%[27]. - Sports segment revenues increased to $4,558 million for the quarter, compared to $4,335 million in the same quarter last year, showing a growth of 5.2%[27]. - Experiences segment revenues reached $8,386 million, up from $8,198 million year-over-year, indicating a growth of 2.3%[27]. - Entertainment segment revenue for the quarter ended June 29, 2024, was $10,580 million, a 4% increase from $10,127 million in the prior year[150]. Legal and Regulatory Matters - The company faced a consolidated complaint in a securities class action lawsuit, alleging misstatements regarding costs and subscriber growth of the Disney+ platform[88]. - The company intends to vigorously defend against various legal actions, including antitrust lawsuits related to pricing and packaging provisions with virtual multichannel video distributors[90]. Impairments and Charges - The company reported a goodwill impairment of $2,038 million for the nine months ended June 29, 2024[10]. - The company recognized a non-cash goodwill impairment charge of $1.3 billion related to the Star India transaction, reflecting cumulative foreign currency translation losses of approximately $0.8 billion[40]. - Restructuring and impairment charges for the nine months ended June 29, 2024, totaled $2,052 million, a decrease from $2,871 million in the prior year[145]. Cash Flow and Financing - Cash provided by operations for the nine months ended June 29, 2024, was $8,453 million, compared to $5,064 million for the same period last year[10]. - The Company’s total borrowings as of June 29, 2024, amount to $47,584 million, with significant reductions in commercial paper and U.S. dollar denominated notes[48]. - The Company met its financial covenant for bank facilities by a significant margin as of June 29, 2024, with total committed capacity of $12,250 million[48]. Subscriber Metrics - Paid subscribers for Disney+ Core increased by 12% to 118.3 million compared to the prior year[175]. - Domestic Disney+ average monthly revenue per paid subscriber decreased from $8.00 to $7.74, a 3% decline compared to the previous quarter[1]. - Hulu SVOD Only average monthly revenue per paid subscriber rose from $11.84 to $12.73, an 8% increase attributed to higher advertising revenue[1].