Disney Earnings Call Live Blog: Bob Iger Talks ESPN/NFL Deal, Disney Parks, And More
The hold music for Disney earnings calls is always interesting. We're getting instrumental Disney music, including "Immortals" from Big Hero 6 and the Winnie the Pooh theme. How's your morning going?
Dropping the NFL/ESPN deal news at the end of business yesterday with the earnings call this morning was an interesting move. I wonder if the plan was to hold it until this morning, but something leaked, or Disney was afraid it would leak, and had to pull the trigger early. I'm assuming Iger's opening remarks will start there, and the first Q&A questions will be devoted to it.
Good morning, the earnings call is getting officially underway with the standard introduction and the cautionary statements.
Bob Iger opens the meeting. Iger touts Disney's "position of strength." Mentions the August 21 launch of standalone ESPN streaming app, alongside the NFL deal.
On the film studio, Iger mentions the live-action Lilo & Stitch success. Says Stitch will be the second highest-grossing merchandise brand for Disney this year, behind the juggernaut that is Mickey Mouse.
Streaming: Hulu is being merged "fully" into Disney+, replacing Star. ESPN standalone app launching August 21. ESPN will sell NFL+ premium subscriptions in the 2025 season. ESPN is getting rights to WWE Premium Live Events
Disney Parks: Iger mentions all the major expansion plans already announced. Disney Cruise Line will launch two ships, Destiny and Adventure this year.
That's it for the opening statement. The streaming info is significant for Disney. Will be a lot to go over in the Q&A.
First question is about ESPN/NFL deal. Asking about giving up 10% of ESPN. Do the changes impact Disney's guidance on sports growth? ESPN will go from 22 to 28 NFL games in a season as part of the deal.
Disney's CFO says he doesn't think the deal will have a material impact on current projections.
Next question asks about the integration of Hulu and wonders about the future of Hulu as a standalone app. Iger talks about the benefit to the consumer, but avoids responding to the future of the Hulu app.
Question on Experiences: Looking for perspective on growth in 2026. Also asks about the ESPN standalone app and how it may be a benefit to those who already have cable.
CFO avoids talking about 2026 yet, but mentions the cost of DCL launches having an impact. Johnstone says the goal is to engage [viewers] where they are." The feeling is that by giving viewers multiple ways to watch ESPN, as long as they use one, they don't care how.
Next question mentions Disney Experiences' growth, asking what is driving domestic park growth. Also asking about spending on content in the next 12 months.
Walt Disney World had a record Q3 revenue number. Disneyland Paris is also doing well. China is a challenge on per capita spending. Cruise Lines are doing well, with high occupancy and bookings. This was the first quarter that Epic Universe was open, and the fact that Walt Disney World had a strong quarter is great news for Disney.
Disney's ship docking in Asia will be its biggest ship in the fleet. Iger says the region has strong "brand affinity."
Question on launching new IP theatrically versus franchise success.
Disney assures that creating new IP is important, but knows familiar IP is popular. Bob Iger says there's no priority one way or the other beyond putting our "great movies." Iger says he considers Fantastic Four an "original property" because a lot of people didn't know those characters.
Next question asks about growth of Disney Cruise Line. Iger says a lot of the new ship guests are repeat visitors who have sailed with Disney before. Iger also mentions that there are many regions where DCL still doesn't sail, and the expansion gives them the ability to do that.
Johnstone says DCL is about half booked out for next year already.
On DTC, Iger says he expects engagement will increase with the ESPN app, NFL deal. Iger touts live streams like news and The Simpsons, which also increase engagement. Iger says Disney shouldn't need to increase spending on domestic series, but will likely invest more in international markets where growth is possible.
Another question on domestic theme park trends. Asks about international visitations and makes a side reference to the Epic Universe opening, wondering how they think it impacted the numbers.
Johnstone says "nothing material" is going on with international attendance changes. Per capita spending is where domestic parks had most of their growth, but says attendance numbers were still good and they were happy.
Final question. Iger thinks opportunity to bundle "other companies" sports offerings is possible. Hints that conversations have happened in that regard, but nothing to report.
That ends the earnings call.
A big day for streaming news with the confirmation of the launch of the ESPN standalone app, as well as the full integration of Hulu. The landscape of streaming, and by extension TV itself, continues to change in a big way.
Disney Parks were strong in the face of Epic Universe, confirming that theme park competition is good for all involved.
We'll see how the markets react to all this news this morning. Disney is stock is well above the $100 mark per share, which is a number it had trouble hitting not that long ago.
