Disney’s stock soared by 8% in after-hours trading following a robust earnings report, indicating significant progress in cost-cutting measures and an optimistic outlook for the future.
Disney anticipates earnings per share of approximately $4.60 for fiscal year 2024, signaling a substantial 20% increase from the previous year. The company reported a notable reduction in costs, trimming $500 million in the first quarter alone, putting it on track to meet or exceed its $7.5 billion cost-cutting goal by the end of the fiscal year. Revenue from theme parks contributed positively to Disney’s performance, with its experiences division achieving record revenue and operating income. Despite a slight increase in revenue to nearly $23.6 billion compared to the same period last year, Disney’s strategic cost-cutting measures have bolstered investor confidence.
Disney announced a significant partnership with Epic Games, the developer of “Fortnite,” investing $1.5 billion in the company and unveiling plans for collaboration on new gaming ventures. The company’s board approved a $3 billion stock buyback, the first since 2018, and declared a cash dividend of 45 cents per share, marking a positive step forward after the suspension of dividend programs during the COVID-19 pandemic.
Disney CEO Bob Iger expressed confidence in the company’s trajectory, emphasizing a commitment to sustained growth and shareholder value creation. Iger assured investors of Disney’s ability to identify a successor before his contract expires in 2026 and reaffirmed the company’s determination to achieve its $7.5 billion annualized savings target by the end of fiscal 2024.
Disney’s strong financial performance, coupled with strategic initiatives and prudent cost management, position the company for continued success in navigating evolving market dynamics and delivering value to shareholders.