Concerns over theme park earnings caused Disney’s stock to drop nearly 10%|Anthony Quintano|CC BY 2.0
Despite news that streaming platform Disney+ brought in its first-ever quarterly profit, Disney shares dropped more than 9%.
What happened?
The House of Mouse’s streaming divisions, Disney+ and Hulu, showed profit for the first time ever, reporting operating income of $47 million, but Disney’s combined streaming business, which also includes ESPN+, reported a loss of $18 million.
Mainly, it mentioned that profit in its parks department will stay flat in Q2. The Experiences segment is Disney’s most profitable wing, which contributes over 52% of the total operating profit.
The forecasted flat operating income for the June quarter disappointed analysts who expected a 12% increase.
Concerns about theme park earnings have historically impacted investor sentiment, leading to significant stock drops. Previous disappointing earnings in this segment in November 2022 led to CEO Bob Chapek’s replacement by Bob Iger.