The Walt Disney Company Reports Fourth Quarter and Full Year Earnings for Fiscal 2025
By:
The Walt Disney Company via
Business Wire
November 13, 2025 at 06:40 AM EST
The Walt Disney Company (NYSE: DIS) today reported earnings for its fourth quarter and full year ended September 27, 2025. Financial Results for the Quarter and Full Year:
Key Points:
Guidance and Outlook(1):
Message From Our CEO: “This was another year of great progress as we strengthened the company by leveraging the value of our creative and brand assets and continued to make meaningful progress in our direct-to-consumer businesses,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “Our strategy, coupled with our portfolio of complementary businesses and a strong balance sheet, enables us to continue investing in high-quality offerings for our consumers and increasing our returns to shareholders, and I’m pleased with our many achievements this fiscal year to position Disney for the future.”
SUMMARIZED FINANCIAL RESULTS The following table summarizes fourth quarter and full year results for fiscal 2025 and 2024:
SUMMARIZED SEGMENT FINANCIAL RESULTS The following table summarizes fourth quarter and full year segment revenue and operating income for fiscal 2025 and 2024:
DISCUSSION OF FOURTH QUARTER SEGMENT RESULTS Star India On November 14, 2024, the Company and Reliance Industries Limited (RIL) formed a joint venture (India joint venture) that combined the Company’s Star-branded and other general entertainment and sports television channels and Disney+ Hotstar direct-to-consumer service in India (Star India) with certain media and entertainment businesses controlled by RIL (the Star India Transaction). RIL has an effective 56% controlling interest in the joint venture with 37% held by the Company and 7% held by a third party investment company. The Company recognizes its 37% share of the India joint venture’s results in “Equity in the income of investees.” Star India results through November 14, 2024 were consolidated in the Company’s financial results. Entertainment Revenue and operating income for the Entertainment segment were as follows:
The decrease in Entertainment operating income in the current quarter compared to the prior-year quarter was due to lower results at Content Sales/Licensing and Other and Linear Networks, partially offset by an increase at Direct-to-Consumer. Linear Networks Linear Networks revenues and operating income were as follows:
Domestic Domestic operating income in the current quarter decreased compared to the prior-year quarter due to:
International The decrease in international operating income was due to the Star India Transaction. Direct-to-Consumer Direct-to-Consumer revenues and operating income were as follows:
The increase in operating income was due to:
The following tables and related discussion are on a sequential quarter basis. Paid subscribers at:
Average Monthly Revenue Per Paid Subscriber for the quarter ended:
Domestic Disney+ average monthly revenue per paid subscriber was comparable to the prior sequential quarter as higher advertising revenue was offset by the impact of subscriber mix shifts. International Disney+ average monthly revenue per paid subscriber increased from $7.67 to $8.00 due to favorable impacts from foreign exchange and subscriber mix shifts. Hulu SVOD Only average monthly revenue per paid subscriber decreased from $12.40 to $12.20 due to the impact of subscriber mix shifts. Hulu Live TV + SVOD average monthly revenue per paid subscriber decreased from $100.27 to $100.02 due to lower advertising revenue. Content Sales/Licensing and Other Content Sales/Licensing and Other revenues and operating income (loss) were as follows:
The decrease in operating results was due to lower theatrical distribution results, partially offset by a decrease in film cost impairments. The current quarter reflected the release of The Fantastic Four: First Steps, The Roses and Freakier Friday and the carry-over performance of Lilo & Stitch, while the prior-year quarter included the release of Deadpool & Wolverine and the carry-over performance of Inside Out 2. Sports Sports revenues and operating income (loss) were as follows:
Domestic ESPN The decrease in domestic ESPN operating income in the current quarter compared to the prior-year quarter reflected:
ESPN International The improvement in ESPN international operating results in the current quarter compared to the prior-year quarter was attributable to higher affiliate revenue due to an increase in effective rates, partially offset by fewer subscribers. Experiences Experiences revenues and operating income were as follows:
Domestic Parks and Experiences Operating income at our domestic parks and experiences increased compared to the prior-year quarter due to growth at Disney Cruise Line attributable to an increase in passenger cruise days, partially offset by higher fleet expansion costs, both reflecting the launch of the Disney Treasure in the first quarter of the current year. International Parks and Experiences International parks and experiences’ operating results increased compared to the prior-year quarter, primarily due to growth at Disneyland Paris. The increase at international parks and experiences was attributable to:
Consumer Products The increase in operating income at consumer products was due to higher licensing revenue. OTHER FINANCIAL INFORMATION Corporate and Unallocated Shared Expenses Corporate and unallocated shared expenses decreased $27 million for the quarter, from $408 million to $381 million, due to the timing of allocations to the segments. Restructuring and Impairment Charges Restructuring and impairment charges (benefits) were as follows:
Interest Expense, net Interest expense, net was as follows:
The decrease in interest expense was due to lower average debt balances and rates. The decrease in interest income, investment income and other was due to an unfavorable comparison related to pension and postretirement benefit costs, other than service cost. Equity in the Income of Investees Equity in the income of investees was as follows:
Income Taxes The effective income tax rate was as follows:
The effective income tax rate in the current and prior-year quarters reflected an unfavorable impact of approximately 5 percentage points and 18 percentage points, respectively from impairments that are not tax deductible. Noncontrolling Interests Net income attributable to noncontrolling interests was as follows:
The increase in net income attributable to noncontrolling interests was due to improved results at National Geographic. Net income attributable to noncontrolling interests is determined on income after royalties and management fees, financing costs and income taxes, as applicable. FULL YEAR CASH FLOW Cash from Operations Cash provided by operations and free cash flow were as follows:
Cash provided by operations increased $4.1 billion to $18.1 billion in the current year from $14.0 billion in the prior year driven by:
Capital Expenditures Investments in parks, resorts and other property were as follows:
Capital expenditures increased to $8.0 billion from $5.4 billion due to higher spending on cruise ship fleet expansion and, to a lesser extent, on new theme park attractions at the Experiences segment. Depreciation Expense Depreciation expense was as follows:
ENTERTAINMENT DTC PRODUCT DESCRIPTIONS AND KEY DEFINITIONS Entertainment DTC Product offerings In the U.S., Disney+ and Hulu SVOD Only are each offered as a standalone service or as part of various bundled offerings, which may include one of the ESPN DTC plans. Hulu Live TV + SVOD includes Disney+ and ESPN Select. Disney+ is available in more than 150 countries and territories outside the U.S. Depending on the market, our services can be purchased on our websites or through third-party platforms/apps or are available via wholesale arrangements. Paid subscribers for Entertainment DTC services Paid subscribers for Entertainment DTC services reflect subscribers for which we recognized subscription revenue. Certain product offerings provide the option for an extra member to be added to an account (extra member add-on). These extra members are not counted as paid subscribers. Subscribers cease to be a paid subscriber as of their effective cancellation date or as a result of a failed payment method. Subscribers to bundled offerings in the U.S. are counted as a paid subscriber for each of the Company's services included in the bundled offering and subscribers to Hulu Live TV + SVOD are counted as one paid subscriber for each of the Hulu Live TV + SVOD and Disney+ services. Subscribers include those who receive an entitlement to a service through wholesale arrangements, including those for which the service is available to each subscriber of an existing content distribution tier. When we aggregate the total number of paid subscribers across our Entertainment DTC streaming services, we refer to them as paid subscriptions. International Disney+ International Disney+ includes the Disney+ service outside the U.S. and Canada. Average Monthly Revenue Per Paid Subscriber for Entertainment DTC services Hulu average monthly revenue per paid subscriber is calculated based on the average of the monthly average paid subscribers for each month in the period. The monthly average paid subscribers is calculated as the sum of the beginning of the month and end of the month paid subscriber count, divided by two. Disney+ average monthly revenue per paid subscriber is calculated using a daily average of paid subscribers for the period. Revenue includes subscription fees, advertising (excluding revenue earned from selling advertising spots to other Company businesses), premium and feature add-on revenue and extra member add-on revenue. Advertising revenue generated by content on one DTC streaming service that is accessed through another DTC streaming service by subscribers to both streaming services is allocated between both streaming services. The average revenue per paid subscriber is net of discounts on offerings that carry more than one service. Revenue is allocated to each service based on the relative retail or wholesale price of each service on a standalone basis. Hulu Live TV + SVOD revenue is allocated to the SVOD services based on the wholesale price of the Hulu SVOD Only, Disney+ and ESPN Select bundled offering. In general, wholesale arrangements have a lower average monthly revenue per paid subscriber than subscribers that we acquire directly or through third-party platforms. NON-GAAP FINANCIAL MEASURES This earnings release presents diluted EPS excluding certain items (also referred to as adjusted EPS), total segment operating income and free cash flow. This earnings release also presents forward-looking Entertainment DTC SVOD operating income and operating margin (operating income divided by revenue). Diluted EPS excluding certain items, total segment operating income, free cash flow and Entertainment DTC SVOD operating income are important financial measures for the Company but are not financial measures defined by GAAP. These measures should be reviewed in conjunction with the most comparable GAAP financial measures and are not presented as alternative measures of diluted EPS, income before income taxes, cash provided by operations or Entertainment segment operating income as determined in accordance with GAAP. Diluted EPS excluding certain items, total segment operating income, free cash flow and Entertainment DTC SVOD operating income as we have calculated them may not be comparable to similarly titled measures reported by other companies. Our definitions and calculations of diluted EPS excluding certain items, total segment operating income and free cash flow, as well as quantitative reconciliations of each of these measures to the most directly comparable GAAP financial measure, are provided below. In addition, our definition of Entertainment DTC SVOD operating income is provided below. The Company is not providing the forward-looking measure for diluted EPS or Entertainment segment operating income (and related margin), which are the most directly comparable GAAP measures to diluted EPS excluding certain items and Entertainment DTC SVOD operating income (and related margin), respectively, or quantitative reconciliations of forward-looking diluted EPS excluding certain items and Entertainment DTC SVOD operating income (and related margin) to those most directly comparable GAAP measures. The Company is unable to predict or estimate with reasonable certainty the ultimate outcome of certain significant items required for such GAAP measures without unreasonable effort. Information about other adjusting items that is currently not available to the Company could have a potentially unpredictable and significant impact on future GAAP financial results. Diluted EPS excluding certain items The Company uses diluted EPS excluding (1) certain items affecting comparability of results from period to period and (2) amortization of TFCF and Hulu intangible assets, including purchase accounting step-up adjustments for released content, to facilitate the evaluation of the performance of the Company’s operations exclusive of these items, and these adjustments reflect how senior management is evaluating segment performance. The Company believes that providing diluted EPS exclusive of certain items impacting comparability is useful to investors, particularly where the impact of the excluded items is significant in relation to reported earnings and because the measure allows for comparability between periods of the operating performance of the Company’s business and allows investors to evaluate the impact of these items separately. The Company further believes that providing diluted EPS exclusive of amortization of TFCF and Hulu intangible assets associated with the acquisition in 2019 is useful to investors because the TFCF and Hulu acquisition was considerably larger than the Company’s historic acquisitions with a significantly greater acquisition accounting impact. The following table reconciles reported diluted EPS to diluted EPS excluding certain items for the fourth quarter:
The following table reconciles reported diluted EPS to diluted EPS excluding certain items for the year:
Total segment operating income The Company evaluates the performance of its operating segments based on segment operating income, and management uses total segment operating income (the sum of segment operating income from all of the Company’s segments) as a measure of the performance of operating businesses separate from non-operating factors. The Company believes that information about total segment operating income assists investors by allowing them to evaluate changes in the operating results of the Company’s portfolio of businesses separate from non-operational factors that affect net income, thus providing separate insight into both operations and other factors that affect reported results. The following table reconciles income before income taxes to total segment operating income:
Free cash flow The Company uses free cash flow (cash provided by operations less investments in parks, resorts and other property), among other measures, to evaluate the ability of its operations to generate cash that is available for purposes other than capital expenditures. Management believes that information about free cash flow provides investors with an important perspective on the cash available to service debt obligations, make strategic acquisitions and investments and pay dividends or repurchase shares. The following table presents a summary of the Company’s consolidated cash flows:
The following table reconciles the Company’s consolidated cash provided by operations to free cash flow:
Entertainment DTC SVOD operating income Entertainment DTC SVOD operating income consists of operating income for the Direct-to-Consumer line of business at the Entertainment segment excluding virtual multichannel video programming distributor services reported in the Direct-to-Consumer line of business. Operating margin for Entertainment DTC SVOD is calculated as operating income divided by revenue. The Company uses Entertainment DTC SVOD operating income (and related margin) as a measure of the performance of our Entertainment DTC SVOD services and we believe Entertainment DTC SVOD operating income (and related margin) assists investors by allowing them to evaluate the performance of these DTC SVOD services. FORWARD-LOOKING STATEMENTS Certain statements and information in this earnings release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our expectations, beliefs, plans, financial prospects, trends or outlook and guidance; financial or performance estimates and expectations (including estimated or expected earnings, operating income, margins, costs, expenses, impact of certain items and timing) and expected drivers; direct-to-consumer prospects, returns to shareholders, including share repurchases, strategic priorities and initiatives and future investments; and other statements that are not historical in nature. Any information that is not historical in nature included in this earnings release is subject to change. These statements are made on the basis of management’s views and assumptions regarding future events and business performance as of the time the statements are made. Management does not undertake any obligation to update these statements. Actual results may differ materially from those expressed or implied. Such differences may result from actions taken by the Company, including restructuring or strategic initiatives (including capital investments, asset acquisitions or dispositions, new or expanded business lines or cessation of certain operations), our execution of our business plans (including the content we create and IP we invest in, our pricing decisions, our cost structure and our management and other personnel decisions), our ability to quickly execute on cost rationalization while preserving revenue, the discovery of additional information or other business decisions, as well as from developments beyond the Company’s control, including:
Such developments may further affect entertainment, travel and leisure businesses generally and may, among other things, affect (or further affect, as applicable):
Additional factors are set forth in the Company’s most recent Annual Report on Form 10-K, including under the captions “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Business,” subsequent quarterly reports on Form 10-Q, including under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and subsequent filings with the Securities and Exchange Commission. The terms “Company,” “we,” and “our” are used in this report to refer collectively to the parent company and the subsidiaries through which our various businesses are actually conducted. PREPARED EARNINGS REMARKS AND CONFERENCE CALL INFORMATION In conjunction with this release, The Walt Disney Company will post prepared management remarks (Executive Commentary) at www.disney.com/investors and will host a conference call today, November 13, 2025, at 8:30 AM EST/5:30 AM PST via a live Webcast. To access the Webcast go to www.disney.com/investors. The Webcast replay will also be available on the site. View source version on businesswire.com: https://www.businesswire.com/news/home/20251113927970/en/ Contacts
David Jefferson
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