The Walt Disney Company stock had its best day in over three years on Thursday after its Wednesday earnings call was full of announcements and also beat earnings estimates. Thursday saw Disney stock go up by 11%. This was the best day for the stock since December 2020.
Some of the news the apparently excited shareholders was the announcement that Disney was investing $1.6 billion Epic Games, the company behind Fortnite. Disney said this new partnership will lead to more games using its intellectual properties including Disney, Pixar, Marvel, Star Wars and Avatar.
In streaming news, Disney announced a new stand-alone ESPN service will be launching in 2025. A new exclusive version of Taylor Swift’s Eras Tour will also be streaming on Disney+. This comes as the company is beginning the process of cracking down on password sharing on its streaming services.
The company also made several movie announcements, including one about Moana 2 that caught most fans by surprise. General timelines were also released for Toy Story 5 and Frozen 3. Aliens: Romulus was also announced as the official name of the next film in the franchise.
Earnings per share for Disney’s first quarter was $1.22 adjusted. It was forecasted to be 99 cents. This came despite revenue missing estimates and earnings being flat year over year. Disney also announced a dividend of 45 cents a share, payable in July. This is 50% higher than its January payout. While Disney did lose subscribers on Disney+, a price hike offset those losses financially. An update was shared on Disney’s $7.5 billion cost cutting measures efforts for the end of 2024. Disney also forecast earnings per share for the year to be around $4.60.
The positive news for Disney comes as it fends off activist shareholders. Nelson Peltz and his Trian Partners are seeking to put Nelson Peltz and former Disney CFO Jay Rasulo on Disney’s Board of Directors. Blackwells Capital has its own plan of adding three members to the board to diversify it and then expand the board by three seats so as to retain the board members that would otherwise be replaced. Both of these efforts now see a steeper uphill climb after this week’s news.
What do you think of Disney’s news and then performance of its shares this week? Are you excited about where Disney is going? Share your thoughts and opinions in the comments below!
