Walt Disney's full-year earnings: what to expect in Q4 2024

When will Walt Disney report its latest earnings?

Walt Disney is scheduled to report its full-year and fourth quarter (Q4) earnings on Wednesday, 14 November 2024 at 9.50pm AEDT, before market opens.

The backdrop

In the third quarter (Q3) 2024, Walt Disney exceeded expectations on both the top and bottom lines. The company's streaming business, which includes Disney+, Hulu, and ESPN+, achieved profitability for the first time.

“Our performance in Q3 demonstrates the progress we’ve made against our four strategic priorities across our creative studios, streaming, sports, and experiences businesses,” said Robert A. Iger, Chief Executive Officer of The Walt Disney Company.

Walt Disney's Q3 2024 results

“This was a strong quarter for Disney, driven by excellent results in our entertainment segment both at the box office and in direct-to-consumer (DTC), as we achieved profitability across our combined streaming businesses for the first time and a quarter ahead of our previous guidance,” stated Iger.

Key financials

Expectations for Q4 2024

• Earnings per share (EPS): $1.10
• Revenue: $22.47 billion

Comparision to previous quarter

• EPS: $1.39
• Revenue: $23.16 billion

Walt Disney's revenue

Highlights of previous quarter

• Overall growth: in Q3 2024, Disney experienced strong growth, with total segment operating income rising 19% and adjusted EPS increasing 35%
• Entertainment segment: operating income tripled year-over-year (YoY), mainly due to significant improvements in direct-to-consumer and content sales/licensing
• Streaming profitability: profitable performance of direct-to-consumer services, particularly ESPN+, led to positive profitability for Disney's streaming businesses, achieving this a quarter earlier than expected
• Inside Out 2 success: the film became the highest-grossing of all time, boosting Disney+ sign-ups
• Sports segment: ESPN saw a 4% increase in operating income, but a decline in Star India led to a 6% decrease in the overall sports segment's operating income
• Experiences revenue: rose by 2%, though operating income decreased by 3% due to moderated consumer demand.

Walt Disney's experiences segment

Guidance and outlook for Q4

• EPS growth: due to strong Q3 performance, Disney has raised its full-year adjusted EPS growth target to 30%
• Cost savings: the company is committed to exceeding previously stated cost-saving targets while focusing on strategic priorities
• Streaming profitability: Disney expects its streaming services, including Entertainment DTC and ESPN+, to remain profitable in Q4, with a positive long-term outlook for margin improvement
• Subscriber growth: Disney+ core subscribers are expected to grow modestly in Q4
• Content profitability: profitability in content sales/licensing is anticipated to stay similar to Q3 levels throughout the fiscal year
• Experiences segment: due to demand moderation in domestic markets, Q4 operating income is expected to decline by mid-single digits. Influences include the Olympics' impact on Disneyland Paris and economic conditions in China
• Cruise line demand: strong demand continues for Disney Cruise Line, though Q4 results will reflect pre-launch expenses for new ships, Disney Adventure and Disney Treasure.

Walt Disney technical analysis

Walt Disney's share price has struggled to regain altitude since falling over 60% from its March 2021 high of $203.02 to the September 2023 low of $78.73, which is even lower than its Covid-19 crash low of $79.07.

In late March, a brave attempt to rally ran out of steam ahead of the 200-week moving average (which currently resides at $121.37) before falling back below $100, where it has spent the past four months trading.

Walt Disney weekly chart

As viewed on the daily chart below, after falling from a high of $123.74 in late March to a low of $83.91 in August, Walt Disney’s share price has since rallied to be eyeing resistance at $100 - $102 area, which includes the 200-day moving average. Above here resides downtrend resistance at $108.00, stemming from the $203.02 high.

If the Walt Disney share price can see a sustained break over the $100 - $102 area and then above $108, it opens the way for the rally to extend towards longer-term resistance at $120 - $126 area. Be aware that while Walt Disney's share price remains below the $100 - $102 area and below $108, downside risks remain, back into the low $80s.

Walt Disney daily chart

• _{Source: TradingView. The figures stated are as of 29 October 2024. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}