Gabrielle Russon
The Walt Disney Co. surprised Wall Street by disclosing that Disney+ made a $47 million profit — the streaming service’s first profitable quarter ever.
“We are delivering on our strategic priorities while building for the future,” Disney CEO Bob Iger said during the company’s earnings call. “We also remain on track to reach profitability in our combined streaming businesses in Q4. We’ve said all along our path to profitability will not be linear.”
Disney+, home of “The Mandalorian” and Disney films, had hemorrhaged billions for the company since it launched in 2019. Tuesday’s update was “a testament to the turnaround we set in motion last year,” Iger said after Disney+ hit “peak losses” 18 months ago. A year ago, Disney+ posted a $587 million shortfall.
The company also warned that Disney will crack down on password sharing on Disney+ starting next month in select markets and then around the world by September.
The streaming service’s milestone wasn’t enough to eclipse the Disney’s TV and Hollywood movies business, and the company’s stock dipped early Tuesday morning.
Meanwhile, theme parks and the Disney Cruise Line keep powering the company’s finances.
Revenue jumped 10% and operating income rose 14% in Disney’s experiences division.
“We’ve got the best in the business in terms of product, and people still have a strong desire to … go on vacation,” said Chief Financial Officer Hugh Johnston, although he warned that the post-pandemic travel boom is leveling out.
On the earnings call, Iger was also asked about the search for his replacement.
Iger stepped down as CEO right before the pandemic as his successor Bob Chapek took control. What followed next was a disaster. High-profile feuds, including a fight with Gov. Ron DeSantis, led to the state taking control of Disney World’s governmental board. Iger later returned to Disney in 2022 and questions about the company’s succession plan have persisted ever since.
Going forward to pick Iger’s next heir, Iger said the company’s Board is meeting regularly to discuss and “manage the process.”
“I’m confident that they will choose the right person at the right time,” Iger said on the earnings call. “To the extent that I can, I will participate in the smooth transition.”
For fans hoping Iger would announce when Disney World’s new ride will open, they will have to keep waiting.
Disney hasn’t given an official opening date for Tiana’s Bayou Adventure, Splash Mountain’s reimagined attraction, that is opening sometime this Summer.
