Walt Disney strengthens profitability, creating the conditions for DIS stock to rise

Walt Disney stock has struggled to break convincingly above resistance around 122 USD for several years. However, the company's fundamentals are improving. Rising streaming profitability, stronger performance from its Experiences segment and expanding cruise business, and increased share repurchases are creating the conditions for a fresh upward move in DIS stock.

The Walt Disney Company (NYSE: DIS) delivered strong earnings for Q3 of fiscal 2026, despite revenue coming in slightly below analysts' expectations. The main growth drivers were improving profitability in the streaming business and strong performance from the Experiences segment, while Sports continued to face pressure from rising sports rights costs. Another positive development was the recovery in free cash flow.

The company maintained its positive outlook for fiscal 2026 and expects further earnings growth, a double-digit streaming operating margin, and continued strong performance from Experiences. Disney also expects double-digit growth in adjusted earnings per share in fiscal 2027 and increased its share repurchase programme to at least 9 billion USD.

This article examines The Walt Disney Company, explains its business model, provides a fundamental analysis of Walt Disney's financial results, presents a technical analysis of Walt Disney stock, and offers a forecast for DIS stock for 2026.

About The Walt Disney Company

The Walt Disney Company is one of the world’s largest media and entertainment corporations, founded on 16 October 1923 by brothers Walter and Roy Disney. The company is renowned for its live-action films and animated cartoons, including iconic creations such as ‘Snow White and the Seven Dwarfs’. Its portfolio includes Lucasfilm, Marvel Studios, Pixar, and 20th Century Studios. In addition to film production, Disney operates theme parks and resorts worldwide – Disney World and Disneyland – and broadcasts television through ABC, ESPN, and National Geographic. In 2019, the company launched the Disney+ streaming service. Another key business area is the production and licensing of merchandise related to its popular franchises. Disney went public on the New York Stock Exchange on 12 November 1957, trading under the ticker DIS.

The Walt Disney Company’s main revenue sources

Walt Disney’s revenue comes from several key sources across a wide range of entertainment and media operations. Disney’s key revenue-generating segments are outlined below:

• Media Networks: television channels and cable networks (ABC, Disney Channel, ESPN, FX, National Geographic, and others). Revenue streams include advertising, licence fees, paid subscriptions, and the sale of broadcasting rights.
• Subscriptions and International Operations: streaming services (Disney+, ESPN+, and Hulu) and international trade. The main sources of income are subscriptions to streaming platforms and the sale of content and licences in foreign markets.
• Parks, Experiences, and Consumer Products: theme parks, resorts, cruises, and hotels. Revenue comes from ticket sales, holiday packages, souvenirs, licensed toys, and other goods and services.
• Studio Entertainment: film production and distribution, home video sales, and music publishing. Revenue comes from cinema distribution, the sale of digital and physical content, and proceeds from music soundtracks and licensing.

In its financial reports, Disney categorises all revenue into three key segments:

1. Entertainment: film production, TV programming, cinema distribution, content sales and licensing, soundtrack releases, and Broadway productions.
2. Sports: operations related to the ESPN brand, including cable and digital sports broadcasts, broadcasting rights for sports events, the ESPN+ streaming platform, advertising, content licensing, and sports analytical programs and events.
3. Experiences: theme parks (Disneyland, Disney World, and international parks), cruises (Disney Cruise Line), resorts and hotels, attractions, as well as events and client engagement activities related to the Disney brand (interactive shows and VIP tours).
4. Eliminations: reflects fees paid by Hulu to ESPN and the Entertainment segment’s linear television business for the rights to broadcast their channels on the Hulu Live platform, as well as fees paid by ABC and Disney+ to ESPN for carrying certain sports content on the ABC channel and Disney+.

The Walt Disney Company Q4 2024 financial results

On 14 November 2024, The Walt Disney Company published its Q4 2024 financial results for the quarter ended 28 September. The key figures are presented below:

• Revenue: 22.57 billion USD (+6%)
• Net income: 0.95 billion USD (–6%)
• Earnings per share: 1.14 USD (+39%)
• Operating profit: 3.65 billion USD (+23%)

Revenue by segment:

• Entertainment: 10.83 billion USD (+14%)
• Sports: 3.91 billion USD (unchanged)
• Experiences: 8.24 billion USD (+1%)

Segment operating income:

• Entertainment: 1.07 billion USD (+353%)
• Sports: 0.92 billion USD (–5%)
• Experiences: 1.66 billion USD (+6%)

Walt Disney's quarterly results were mixed. Adjusted earnings per share exceeded analysts' expectations, while revenue came in slightly below the consensus forecast. Most key financial indicators recorded growth. However, net income declined due to higher spending on content production and marketing, as well as continued investment in the Disney+ and Hulu streaming services.

For 2026, the company forecast slower growth in the Sports segment, solid single-digit growth in Experiences, and strong double-digit growth in Entertainment. Overall, Walt Disney's outlook for 2025–2026 pointed to further improvement in the company's financial performance, creating conditions for higher dividend payments and increased share repurchases, which could in turn support its stock price.

The Walt Disney Company Q1 2025 financial results

On 5 February 2025, The Walt Disney Company published its Q1 2025 financial results for the quarter ended 28 December 2024. The key figures are presented below:

• Revenue: 24.69 billion USD (+6%)
• Net income: 3.66 billion USD (+27%)
• Earnings per share: 1.76 USD (+44%)
• Operating profit: 5.06 billion USD (+31%)

Revenue by segment:

• Entertainment: 10.87 billion USD (+9%)
• Sports: 4.85 billion USD (unchanged)
• Experiences: 9.41 billion USD (+3%)

Segment operating income:

• Entertainment: 1.70 billion USD (+95%)
• Sports: 247 million USD (vs an operating loss of 103 million USD)
• Experiences: 3.11 billion USD (+31%)

Walt Disney's quarterly results exceeded market expectations, with the company outperforming analysts' forecasts for both revenue and earnings. However, the stock fell following the results, as investors were concerned about a decline in Disney+ subscribers and management's warning that subscriber numbers could decline further in the following quarter.

For fiscal 2025, Disney forecast high single-digit growth in adjusted earnings per share and an increase of approximately 875 million USD in the operating profit of its streaming business. The company also reaffirmed its plan to allocate 3.00 billion USD to share repurchases, while maintaining a positive outlook for its streaming business and Experiences segment.

The Walt Disney Company Q2 2025 financial results

On 7 May 2025, The Walt Disney Company published its Q2 2025 financial results for the quarter ended 29 March 2025. The key figures are presented below:

• Revenue: 23.62 billion USD (+7%)
• Net income: 3.09 billion USD (+369%)
• Earnings per share: 1.45 USD (+20%)
• Operating profit: 4.43 billion USD (+15%)

Revenue by segment:

• Entertainment: 10.68 billion USD (+9%)
• Sports: 4.53 billion USD (+5%)
• Experiences: 8.89 billion USD (+6%)
• Eliminations: (484) million USD (compared with a loss of 418 million USD)

Segment operating income:

• Entertainment: 1.26 billion USD (+61%)
• Sports: 0.69 billion USD (–12%)
• Experiences: 2.49 billion USD (+9%)

Walt Disney's Q2 fiscal 2025 results exceeded market expectations and confirmed the company's improving financial performance. Positive drivers included growth in the streaming business despite earlier forecasts of declining subscriber numbers, strong box office performance, resilient cash flow, and lower debt. Another positive development was the announcement of a new Disney theme park in Abu Dhabi, which will be developed under a model requiring minimal capital investment from the company. Following the results, Walt Disney stock rose by 11%.

Following the strong results, Disney raised its fiscal 2025 adjusted earnings per share guidance to 5.75 USD, representing 16% year-on-year growth. The company also forecast double-digit growth in Entertainment operating profit, 18% growth in Sports, and 6–8% growth in Experiences. In addition, management expected subscriber numbers across its streaming services to continue increasing in the following quarter.

The Walt Disney Company’s Q3 2025 financial results

On 7 August 2025, The Walt Disney Company published its Q3 2025 financial results for the quarter ended 28 June 2025. The key figures are presented below:

• Revenue: 23.65 billion USD (+2%)
• Net income: 3.21 billion USD (+4%)
• Earnings per share: 1.61 USD (+16%)
• Operating profit: 4.57 billion USD (+8%)

Revenue by segment:

• Entertainment: 10.70 billion USD (+1%)
• Sports: 4.30 billion USD (–5%)
• Experiences: 9.08 billion USD (+8%)
• Eliminations: (448) million USD (compared with a loss of 369 million USD)

Segment operating income:

• Entertainment: 1.02 billion USD (–15%)
• Sports: 1.03 billion USD (+29%)
• Experiences: 2.51 billion USD (+13%)

Walt Disney's Q3 fiscal 2025 results were broadly stronger than market expectations. Adjusted earnings per share exceeded analysts' forecasts, while revenue recorded modest growth. The main positive drivers were the streaming business returning to profitability, growth in Sports operating profit, and strong performance from Experiences. Entertainment remained under pressure from traditional television and weaker box office performance.

For fiscal 2025, Disney expected adjusted earnings per share of approximately 5.85 USD, representing 18% year-on-year growth. The company also forecast double-digit growth in Entertainment operating profit, 18% growth in Sports, and approximately 8% growth in Experiences. At the same time, management expected continued growth in Disney+ and Hulu subscriber numbers, alongside further expansion of its theme parks, cruise business, and ESPN's digital platform.

The Walt Disney Company Q4 2025 financial results

On 13 November 2025, The Walt Disney Company published its Q4 2025 financial results for the quarter ended 27 September 2025. The key figures are presented below:

• Revenue: 22.46 billion USD (+0%)
• Net income: 2.04 billion USD (+115%)
• Earnings per share (non-GAAP): 1.11 USD (–3%)
• Operating profit (non-GAAP): 3.48 billion USD (–5%)

Revenue by segment:

• Entertainment: 10.21 billion USD (+1%)
• Sports: 3.98 billion USD (+2%)
• Experiences: 8.77 billion USD (+6%)
• Eliminations: (490) million USD (compared with a loss of 409 million USD)

Segment operating income:

• Entertainment: 0.69 billion USD (–15%)
• Sports: 0.91 billion USD (–2%)
• Experiences: 1.88 billion USD (+13%)

Walt Disney's Q4 fiscal 2025 results were mixed. Adjusted earnings per share exceeded analysts' expectations, while revenue came in slightly below the consensus forecast. Results were weighed down by lower operating profit in the Entertainment segment, while Experiences maintained solid growth and the streaming business continued to improve its profitability.

For fiscal 2026, Disney forecast double-digit growth in adjusted earnings per share, further improvements in streaming profitability, and strong cash flow generation. The company also planned to increase its share repurchase program to 7 billion USD and raise its annual dividend to 1.50 USD per share, while continuing to invest heavily in its theme parks and cruise business.

The Walt Disney Company Q1 2026 financial results

On 2 February 2026, The Walt Disney Company published its Q1 2026 financial results for the quarter ended 27 December 2025. The key figures are presented below:

• Revenue: 25.98 billion USD (+5%)
• Net income: 2.40 billion USD (–6%)
• Earnings per share (non-GAAP): 1.63 USD (–7%)
• Operating profit (non-GAAP): 4.60 billion USD (–9%)

Revenue by segment:

• Entertainment: 11.61 billion USD (+7%)
• Sports: 4.91 billion USD (+1%)
• Experiences: 10.01 billion USD (+6%)
• Eliminations: (543) million USD (compared with a loss of 447 million USD)

Segment operating income:

• Entertainment: 1.10 billion USD (–35%)
• Sports: 0.19 billion USD (–23%)
• Experiences: 3.31 billion USD (+6%)

Walt Disney's quarterly results exceeded analysts' expectations for both revenue and adjusted earnings per share. However, the company's stock fell by 8% following the results. Investors were concerned by the decline in total segment operating profit, a sharp deterioration in cash flow, weaker international tourism at the company's US theme parks, and lower operating profit in the Entertainment segment. At the same time, Experiences remained resilient, while the streaming business continued to improve its profitability.

For Q2 of fiscal 2026, Disney expected Entertainment operating profit to remain stable, streaming profitability to improve further, Sports profit to decline modestly, and Experiences to grow moderately. For fiscal 2026 as a whole, the company reaffirmed its guidance for double-digit growth in adjusted earnings per share, operating cash flow of around 19 billion USD, and share repurchases totalling 7 billion USD.

The Walt Disney Company Q3 2026 financial results

On 5 August 2026, The Walt Disney Company published its Q3 2026 financial results for the quarter ended 27 June 2026. The key figures are presented below:

• Revenue: 25.25 billion USD (+7%)
• Net income: 2.64 billion USD (–50%)
• Earnings per share (non-GAAP): 2.06 USD (+28%)
• Operating profit (non-GAAP): 5.56 billion USD (+21%)

Revenue by segment:

• Entertainment: 11.35 billion USD (+6%)
• Sports: 4.50 billion USD (+4%)
• Experiences: 9.97 billion USD (+10%)
• Eliminations: (565) million USD (compared with a loss of 448 million USD)

Segment operating income:

• Entertainment: 1.68 billion USD (+64%)
• Sports: 0.86 billion USD (–17%)
• Experiences: 3.02 billion USD (+20%)

Walt Disney's Q3 fiscal 2026 results can be viewed positively. Revenue came in slightly below analysts' expectations, while adjusted earnings were significantly ahead of forecasts. Total segment operating profit grew considerably faster than revenue, indicating improving business efficiency. Net income declined, although the comparison was distorted by one-off factors in the prior-year period and impairment charges recorded in the current quarter.

Entertainment delivered a marked improvement in performance, driven by the streaming business. Disney+ and Hulu continued to increase both revenue and profitability, while subscriber losses continued to moderate. This represents an important shift for Disney, with streaming gradually evolving from a loss-making business into a driver of earnings growth. Successful box office releases also provided additional support, although the performance of individual films remained uneven.

Experiences remains Disney's financial backbone. The company's US theme parks continue to benefit from resilient demand, while the cruise business is growing as the fleet expands. International theme parks, particularly those in Asia, remain weaker, meaning growth across the segment may continue to be uneven.

Sports remains Disney's weakest business. Revenue continues to grow, but profitability is declining due to rising sports rights costs. The key question for investors is whether Disney can increase ESPN revenue faster than the cost of sports rights continues to rise.

Another positive development was the improvement in cash flow. Operating cash flow increased by 33% to 4.87 billion USD, while free cash flow rose by 63% to 3.07 billion USD.

For the first nine months of the fiscal year, results remain below the previous year's levels due to higher tax expenses and substantial investment in theme parks and the cruise business. However, the Q3 results demonstrate that Disney is capable of investing for future growth while continuing to generate significant cash flow.

This is important for shareholders because strong free cash flow enables the company to continue paying dividends and repurchase its own shares.

Disney maintained its guidance for 16% growth in adjusted earnings per share in fiscal 2026, including the benefit of an additional 53rd week. Excluding this effect, adjusted earnings per share are expected to grow by approximately 12%.

The company expects double-digit growth in Entertainment profit, continued strong performance from Experiences, and more moderate growth in Sports. At the same time, Entertainment could come under pressure in Q4 due to weaker performance from Moana and a softer advertising market for streaming services.

Another positive development was Disney's decision to increase its share repurchase program to at least 9 billion USD, up from the previous target of 7 billion USD. The company also plans to sell its 50% stake in A+E Global Media for approximately 1.2 billion USD and use part of the proceeds for additional share repurchases.

Overall, the results show that Disney is gradually improving the quality of its earnings. Streaming has become profitable, the theme parks continue to grow, cash flow has recovered, and the company is increasing its share repurchases. The main area of weakness remains Sports, where rising sports rights costs continue to weigh on profitability.

Key growth drivers for The Walt Disney Company stock

When analysing The Walt Disney Company stock in 2026, investors should focus on several key indicators. A fundamental analysis of DIS shows that the most important factors are the profitability of the company's theme parks and streaming business, its ability to reduce its dependence on traditional television, and its capacity to generate free cash flow despite substantial investment. Together, these indicators help determine whether Disney can move from recovery to sustained earnings growth and create the conditions for the stock to break out of its long-standing trading range of 80–120 USD.

Experiences operating income. The Experiences segment, which includes theme parks, resorts, and the cruise business, remains one of Disney's primary profit drivers. Growth in its operating income is therefore an important indicator of the company's overall financial health. Higher park attendance, increased guest spending, and expanding cruise capacity enable Disney to grow earnings even when overall revenue growth remains moderate.

For Disney stock, the most favourable scenario would be continued steady growth in Experiences operating income. If the segment's operating profit begins to slow or decline, the market will find it more difficult to expect an acceleration in the company's overall financial performance. For now, this growth driver remains resilient and continues to support Disney's investment case.

Streaming operating margin (SVOD operating margin). Disney's streaming business has progressed from generating substantial losses to delivering sustainable profitability. As a result, investors should now focus on its SVOD operating margin. An improving margin indicates that Disney+ and Hulu are becoming meaningful profit contributors and that growth in streaming revenue is being translated more efficiently into the company's financial results.

For Disney stock to continue rising, it is important that the company maintains a double-digit SVOD operating margin and gradually improves it further. This would allow the streaming business to move from a period of recovery to one of sustained earnings growth, making it one of the company's principal growth drivers.

Streaming operating income and Linear Networks operating income. One of the main factors weighing on Disney stock in recent years has been the decline in profitability of its traditional television business. For a long time, growth in the streaming business merely offset this deterioration, meaning the company's overall operating profit increased much more slowly than the operating profit generated by Disney+ and Hulu. Disney itself separately reports Entertainment SVOD operating income separately from the performance of its traditional Linear Networks business, making this comparison particularly relevant.

The key signal for a potential re-rating of the stock will be the point at which growth in streaming operating income consistently outpaces the decline in Linear Networks operating income. At that stage, Disney's digital business will no longer simply offset the structural decline in traditional television but will begin generating additional earnings growth for the company. Such a shift could become a key condition for the stock to break above its long-standing resistance around 120 USD.

Free cash flow and capital expenditure. Disney continues to invest heavily in expanding its theme parks, cruise business, technology infrastructure, and the development of new products. As a result, free cash flow is especially important, as it shows how effectively the company funds these substantial investments through its core business.

The strongest positive signal for Disney stock would be rising free cash flow combined with a controlled increase in capital expenditure. If investment continues to grow while driving higher Experiences earnings, stronger streaming profitability, and increasing cash flow, the market will gain further confidence in the effectiveness of Disney's strategy. Conversely, a decline in free cash flow while capital expenditure remains elevated could once again limit the stock's upside potential.

The DIS fundamental analysis based on the indicators discussed above points to a gradual improvement in the company's financial position. Experiences continues to increase operating profit, while the streaming business has progressed from substantial losses to an operating margin of around 13%. In Q3 of fiscal 2026, Streaming operating profit exceeded that of Linear Networks for the first time, marking an important turning point as the digital business begins to fully offset the decline in traditional television. At the same time, following a sharp increase at the start of fiscal 2026, capital expenditure declined to roughly the previous year's level, while free cash flow recovered significantly during Q2 and Q3.

The key question now is whether Disney can translate these improvements into sustained growth in overall earnings and free cash flow. Further growth in Experiences, a continued double-digit streaming operating margin, a widening lead over Linear Networks, and stabilising capital expenditure would all be positive signals. If these trends continue, Disney stock will have a stronger fundamental basis for breaking out of its long-standing trading range of 80–120 USD. The improvement is already evident, but the market is likely to require further confirmation over the coming quarters before a sustained break above the 120 USD resistance level.

Expert forecasts for The Walt Disney Company stock for 2026

• Barchart: 23 of 32 analysts rate Walt Disney stock as Strong Buy, 4 as Moderate Buy, 4 as Hold, and 1 as Strong Sell. The highest price target is 160 USD, while the lowest is 88 USD.
• MarketBeat: 17 of 21 analysts rate the stock as Buy, 3 as Hold, and 1 as Sell. The highest price target is 151 USD, while the lowest is 111 USD.
• TipRanks: 19 of 20 analysts rate Walt Disney stock as Buy, while 1 rates it as Hold. The highest price target is 144 USD, while the lowest is 111 USD.
• Stock Analysis: 24 of 33 analysts rate Walt Disney stock as Strong Buy, 6 as Buy, 2 as Hold, and 1 as Strong Sell. The highest price target is 160 USD, while the lowest is 88 USD.

Analysts' outlook for The Walt Disney Company remains broadly positive. Across all four platforms, the majority recommend buying the stock, with the strongest consensus on TipRanks, where 19 of 20 analysts assign a Buy rating. The highest price targets range from 144 USD to 160 USD, suggesting further upside potential if the company's financial performance continues to improve.

At the same time, the range of price targets remains wide, with the most conservative forecasts from Barchart and Stock Analysis as low as 88 USD. This suggests that some analysts continue to factor in the risks associated with the structural decline of the traditional media business, rising sports rights costs, and the capital-intensive expansion of Disney's theme parks and cruise business.

The Walt Disney Company stock price forecast for 2026

At the time of writing, DIS stock is trading at around 109 USD.

As of August 2026, Walt Disney stock continues to trade within a broad range between 80 USD and 122 USD. In June 2025, the stock attempted to break above the upper boundary of this range, but demand proved insufficient to secure a convincing breakout above resistance. After failing to break above 122 USD, the stock did not return to the lower boundary of the range. Instead, a fresh upward move began from around 92 USD.

In addition, DIS remains above its 200-period Moving Average, suggesting an uptrend may be forming. The Stochastic indicator has emerged from oversold territory and turned higher, signalling that the current upward momentum may continue. Based on the current performance of Walt Disney Company stock, the following scenario outlines its potential movement in the second half of 2026.

The outlook for Walt Disney Company stock remains positive, provided the price holds above the key support level around 92 USD.

The trading strategy for DIS stock is to buy at the current market price of around 109 USD. The first upside target is the resistance level at 122 USD. If the stock breaks above this level, the next target is 160 USD, just below the stronger resistance level around 168 USD. Accordingly, the strategy uses two Take Profit levels: the first at 122 USD and the second at 160 USD.

A Stop Loss is recommended at 91 USD, just below the support level around 92 USD.

The risk-to-reward ratio is 1:0.7 for the first target and 1:2.8 for the second. As the stock is already in an upward phase, the distance to the first target is shorter than the distance to the Stop Loss, making the risk-to-reward ratio for the first Take Profit relatively unattractive. A more favourable entry point may emerge if the stock undergoes a correction. However, waiting for a pullback risks missing further upside.

Position management: Once the stock has moved 10% in the projected direction, move the Stop Loss to the entry level. The protective stop should then be trailed 10% behind the price. Continue trailing the stop until the position is closed, either at the Take Profit or the Stop Loss, depending on which level is reached first.

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