Disney shares sink as streaming business falls shy of profitability

Core Insights - Disney's combined streaming business, which includes Disney+, Hulu, and ESPN+, reported revenues of $6.19 billion with an operating loss of only $18 million in the second quarter, marking a 97% decrease in operating loss compared to the same period last year [1] - The entertainment streaming segment of Disney+ and Hulu achieved an operating income of $47 million, a significant turnaround from peak losses reported 18 months ago [1] - Disney anticipates profitability for its combined streaming business in the fourth quarter and expects further improvements in profitability for the following year, with a target of reaching this milestone in 2024 [2] Streaming Initiatives - Disney+ plans to implement a global password crackdown starting in September to prevent account sharing among non-household members [3] - The service will introduce an in-platform ESPN tile in the U.S. by the end of the calendar year, following the successful integration of the "Hulu on Disney+" feature for bundle subscribers [3] - Disney envisions its streaming business achieving double-digit profit margins in the future [4] Financial Performance - Overall, Disney generated $22.08 billion in revenue in the second quarter, an increase from $21.82 billion year-over-year, although it fell short of Wall Street estimates [5] - The company reported adjusted earnings per share of $1.21, exceeding the $1.10 estimate [5]