To The Moon

$Walt Disney(DIS)$ dips as it following a miss on top and bottom lines in its fiscal fourth-quarter earnings at after-hours on November 8.

Two main factors affect Disney's price, Streaming (mainly Disney +), and parks. The former is more important. Disney has several cable TV businesses, but this utility-like business has little impact on the stock price.

Interestingly, in August, the market was surprised by its Park business due to unexpected recovery.

This quarter seems to pay it back

• Revenue was 20.15 billion US dollars, a year-on-year increase, which was less than the expected 21.26 billion US dollars; The adjusted EPS was 0.3 US dollars, which was less than the expected 0.51 US dollars;
• In terms of classification, the revenue of entertainment and media was 12.73 billion US dollars,-4.36% year-on-year, lower than the expected 13.81 billion US dollars; Revenue from theme parks and consumer goods was US $7.43 billion, up 36% year-on-year, which fell short of the expected US $7.59 billion.
• The total number of streaming media users reached 235 million, up 31% year-on-year, higher than the market expectation of 233 million. Among them, Disney+164 million, up 39% year-on-year, higher than the market expectation of 162 million.

For Segment

• Cable TV revenue was 6.33 billion US dollars,-2.19% year-on-year, which was less than the expected 6.65 billion US dollars; Operating profit was $1.74 billion, beating expectations of $1.61 billion,
• DTC's business revenue was US $4.91 billion, up 7.6% year-on-year, less than the expected US $5.37 billion, and its operating profit was-1. 47 billion US dollars, less than the expected US $1.11 billion.
• The revenue of content authorization and distribution was USD 1.74 billion,-15.2% year-on-year, which was less than the expected USD 2.06 billion, and the operating profit was USD 180 million, which was less than the expected USD 160 million.
• The revenue of domestic parks was 5.01 billion US dollars, a year-on-year increase of 44.3%, which was less than the market expectation of 5.2 billion US dollars;
• The revenue of the International Park was 1.07 billion US dollars, a year-on-year increase of 55%, exceeding the market expectation of 1.03 billion US dollars;
• Consumer goods revenue was US $1.34 billion, up 4.44% year-on-year, exceeding the market expectation of US $1.31 billion.

Apparently, loss in streaming media is too large, and parks business does not meet market expectations.

The strong offline recovery made analysts confident about the Park business and raise expectations. Therefore, the 36% year-on-year growth rate of Disneyland business is not low, only the expectation is too high.

Inflation makes Disney hard, tickets are not easy to increase, but it is easier for consumer goods to rise in price.

The entertainment business also showed a decline trend, among which the performance of cable TV declined, which most investors can imagine was largely due to the slowdown of advertising and the fierce competition of streaming media.

Although streaming media users grew better than expected, the total number of users reached 235 million,But the single-quarter loss reached $1.47 billion, almost reaching the peak of DIS's financially acceptable single-quarter loss($1.5 billion). In other words, from next quarter, Disney will consider how to make a profit in streaming.

The company is still expected to be profitable by the end of 2024

To sum up, market expectation makes Disney's prices. As for fiscal year 2023, it is the performance-realized orented year.