Disney earnings beat lifts shares despite revenue miss

Investing.com -- Walt Disney Co (NYSE: DIS) shares rose 4.9% premarket after the entertainment giant reported third-quarter adjusted earnings that exceeded Wall Street expectations, though revenue came in slightly below estimates.

The company posted adjusted earnings per share of $2.06 for the third quarter, beating the analyst consensus of $1.86 by $0.20. Revenue reached $25.25 billion, up 7% YoY from $23.7 billion, but fell short of the $25.43 billion analyst estimate. Total segment operating income surged 21% to $5.6 billion from $4.6 billion in the prior-year quarter.

The stock gained ground following the earnings release, with investors focusing on the strong profit performance and raised share buyback target. Disney increased its fiscal 2026 share repurchase target to at least $9 billion, up from previous expectations, partly funded by approximately $1.2 billion in proceeds from selling its 50% stake in A+E Global Media to Hearst Corporation.

"Our strong fiscal third-quarter results and reiterated full-year outlook reinforce our confidence that we are uniquely well positioned," said CEO Josh D'Amaro and CFO Hugh Johnston in a shareholder letter.

The Experiences segment drove growth with operating income up 20% to $3.0 billion, benefiting from a $100 million tariff refund. Global guests grew 4%, with domestic park attendance up 3% and per capita spending rising 4%. Entertainment segment operating income jumped 64% to $1.7 billion, while Sports segment operating income declined 17% to $858 million.

Disney maintained its fiscal 2026 adjusted EPS growth guidance of approximately 12% excluding the 53rd week impact, or 16% including it. The company expects fourth-quarter total segment operating income of approximately $4.9 billion. For fiscal 2027, Disney continues to expect double-digit adjusted EPS growth, excluding the 53rd week impact.

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