Walt Disney's stock climbs as company cites 'Toy Story 5' for earnings growth

By Steve Goldstein

Disney credited "Toy Story 5" for helping drive earnings growth.

Walt Disney stock, which has been struggling all year, rallied on Wednesday as the entertainment giant reported surprisingly strong earnings.

Disney said its adjusted earnings in the fiscal third quarter rose 28%, to $2.06 a share, as revenue rose 7%, to $25.25 billion, and the company reiterated its guidance for both the current and next fiscal year.

Analysts polled by FactSet expected earnings of $1.86 a share on revenue of $25.39 billion.

Disney's shares (DIS), down 14% this year, rose 4% in premarket trade.

Disney pointed to growth in visitors to its theme parks; the theatrical and consumer-products success of "Toy Story 5"; and strong ESPN viewership. It did see a big 17% operating-profit drop in its sports segment, due to early-round sweeps in the NBA playoffs and a network-carriage dispute.

The earnings numbers exclude an impairment taken ahead of its deal, announced Tuesday, to sell its 50% stake in A+E Global Media to co-owner Hearst Corporation for $1.2 billion in cash.

Disney said it is targeting $9 billion in stock buybacks this year, which is the second time it has increased its target this fiscal year.

Disney said it would shift much of its consumer-products business to its entertainment segment from its experiences segment, beginning in the next fiscal year, to more closely align consumer products with the studios that create the intellectual property.

Disney also flagged that it is "mid-stream" through work to cut costs, including in labor and selling, general and administrative expenses.

-Steve Goldstein

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08-05-26 0743ET