01—Abstract
Summary
Summary of the 10-Q filed May 6, 2026. Cited figures are marked; the original filing is the authoritative source.
Walt Disney Company's Q2 2026 filing shows a 7% increase in total revenues to $25.2 billiona, driven by strong performance in its Services segment, which grew 7% to $22.7 billion.
Despite revenue growth, net income attributable to Disney declined significantly by 31% to $2.2 billionb, and diluted EPS fell 30% to $1.27. This decline was primarily attributed to a substantial tax benefit recognized in the prior-year quarter from the resolution of a tax matter, which is not present in the current period. The current quarter also saw increased restructuring and impairment charges, including an impairment of an equity investment.
Operationally, the Experiences segment continued its positive trajectory, with revenues up 7%c year-over-year, driven by theme park admissions and resort/vacation offerings. The Entertainment segment also saw revenue growth of 10%, supported by subscription and affiliate fees, and content sales.
However, the Sports segment experienced a slight revenue dip of 2%. The company actively managed its capital structure, repurchasing $3.5 billiond in stock during the quarter and maintaining a strong liquidity position with $5.8 billion in cash, cash equivalents, and restricted cash.
02—Key points
Key Highlights
- Total revenues increased by 7% to $25.2 billion, primarily driven by the Services segment.
- Net income attributable to Disney decreased by 31% to $2.2 billion, largely due to a one-time tax benefit in the prior year.
- Diluted EPS declined by 30% to $1.27, also impacted by the prior-year tax benefit.
- The Experiences segment showed robust revenue growth of 7%, fueled by theme parks and resorts.
- Entertainment segment revenue grew by 10%, aided by subscription fees and content sales.
- The company repurchased $3.5 billion of its common stock in the quarter, indicating a continued focus on returning capital to shareholders.
- Restructuring and impairment charges increased, including an impairment of an equity investment in A+E Global Media.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed May 6, 2026Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $25.17B$23.62B | +6.5% |
| SG&A Expenses | $4.07B$3.98B | +2.3% |
| Operating Expenses | $21.38B$20.11B | +6.3% |
| Operating Income | $4.60B$4.44B | +3.8% |
| Interest Expense | $473.00M$471.00M | +0.4% |
| Net Income | $2.25B$3.27B | −31.4% |
| EPS (Basic) | $1.27$1.81 | −29.8% |
| EPS (Diluted) | $1.27$1.81 | −29.8% |
| Shares Outstanding (Basic) | 1.77B1.81B | −2.3% |
| Shares Outstanding (Diluted) | 1.77B1.81B | −2.3% |
05—Questions
Frequently Asked Questions
Why did net income and EPS decrease despite revenue growth?
The decrease in net income and diluted EPS was primarily due to a significant tax benefit recognized in the prior-year quarter related to the resolution of a tax matter, which did not recur in the current quarter. This created a strong comparable period, making the current quarter's results appear lower on a year-over-year basis.
What is driving the revenue growth in the Experiences segment?
Revenue growth in the Experiences segment is driven by increased theme park admissions, higher revenue from resorts and vacations (including contributions from new cruise ships), and growth in parks and experiences merchandise, food, and beverage sales.
What is the impact of the Fubo and NFL transactions on the financial results?
The Fubo and NFL transactions have contributed to revenue growth in the Services segment, particularly in Entertainment and Sports. They have also resulted in increased cost of services and have had a non-cash tax impact in the current period, as noted in the Management's Discussion and Analysis.
What is the company's approach to capital allocation, specifically share repurchases and dividends?
The company repurchased $3.5 billion of its common stock during the quarter and has remaining authorization for approximately 288 million additional shares. The company also declared dividends totaling $1.3 billion for the fiscal year. Management has indicated that share repurchases and dividends are part of its capital allocation strategy.
06—Continue