Summary
The Walt Disney Company reported a net loss attributable to Disney of $460 million, or $(0.25) per diluted share, for the third quarter of fiscal year 2023. This loss was largely driven by a significant restructuring and impairment charge of $2.65 billion, primarily related to content impairment. Excluding this charge, the company would have reported a profit. Total revenues increased by 4% year-over-year to $22.3 billion, bolstered by strong performance in Parks, Experiences, and Products, which saw an 13% revenue increase, and growth in Direct-to-Consumer (DTC) subscription fees. Despite the headline loss, underlying business trends show resilience. The Parks, Experiences, and Products segment continues to be a strong performer, with revenues up 13% driven by increased attendance and guest spending. The Direct-to-Consumer segment narrowed its operating loss to $512 million from $1.06 billion in the prior year, indicating progress towards profitability. However, the Media and Entertainment Distribution segment saw an 18% decline in operating income, primarily due to softer performance in Linear Networks.
Key Highlights
- 1Net loss attributable to Disney of $460 million ($0.25 per diluted share) for the quarter, significantly impacted by a $2.65 billion content impairment charge.
- 2Total revenues increased 4% to $22.3 billion, driven by the Parks, Experiences and Products segment.
- 3Parks, Experiences and Products segment revenue grew 13% to $8.3 billion, with strong performance in theme park admissions and merchandise/food/beverage sales.
- 4Direct-to-Consumer (DTC) segment revenue increased 9% to $5.5 billion, with subscription fees up 17%, while operating loss narrowed to $512 million.
- 5Media and Entertainment Distribution segment operating income decreased 18% to $1.1 billion, primarily due to declines in Linear Networks.
- 6The company expects fiscal year 2023 content spend to be approximately $27 billion, down from $30 billion in fiscal year 2022.