Walt Disney Earnings Expected to Show Monster Growth

Our preview of the upcoming week's earnings reports include Walt Disney (DIS), Coinbase Global (COIN) and Bumble (BMBL).

Someone holding a phone showing the Disney+ app
(Image credit: Getty Images)

Although the busiest stretch of the second-quarter earnings season is mercifully behind us, it's far from over. Among the notable names on this week's earnings calendar is entertainment giant Walt Disney (DIS (opens in new tab), $105.71).

DIS is slated to report its fiscal third-quarter results after Wednesday's close. Analysts, on average, estimate earnings of $1.00 per share for the three-month period ended June 30, up 44.9% on a year-over-year (YoY) basis. The Street forecasts revenue to jump 20.6% to $20.5 billion.

While Disney's theme parks likely benefited from an easing of COVID-related lockdowns, investors and traders will be interested to see what impact high inflation had on consumers' purchasing power, says Charlie Williams, equity research assistant at U.K.-based financial firm Hargreaves Lansdown.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%
https://cdn.mos.cms.futurecdn.net/flexiimages/xrd7fjmf8g1657008683.png

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of Kiplinger’s expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of Kiplinger’s expert advice - straight to your e-mail.

Sign up

But as important as parks are to the entertainment conglomerate's bottom line, Disney's direct-to-consumer segment will likely draw the bulk of the market's attention. After all, competitor Netflix (NFLX (opens in new tab)) last month said it lost nearly 1 million subscribers in the April-to-June period, Williams adds. In its fiscal second quarter, Disney's Disney Plus streaming service added a greater-than-expected 7.9 million subscribers.

Furthermore, the fact that Disney suspended its dividend in 2020 and has not repurchased stock since 2018 "puts added pressure on successful execution of Disney Plus, which requires significant capital," says CFRA Research analyst Kenneth Leon (Hold). For the company's fiscal Q3, Leon expects earnings per share (EPS) in line with the consensus, but anticipates slightly higher revenue of $21 billion.

Coinbase Global Revenue Dropped Sharply in Q2

Coinbase Global (COIN (opens in new tab), $91.60) made headlines last week when it unveiled a partnership with BlackRock (BLK (opens in new tab)), the world's largest asset management firm. The deal will allow BlackRock's institutional investors to buy bitcoin via the cryptocurrency platform.

The news gave a much-needed boost to COIN stock, which is down more than 64% for the year-to-date. Can the company's second-quarter earnings report (due after the Aug. 9 close) keep the wind at its back?

Sign up for Kiplinger's FREE Investing Weekly e-letter for stock, ETF and mutual fund recommendations, and other investing advice.

Mizuho Securities analyst Dan Dolev isn't so sure. While volume on the trading platform remains depressed, "consensus continues to overestimate COIN's revenue generation power." Dolev adds that he remains "cautious and Neutral" on COIN stock.

As for those consensus estimates, analysts, on average, expect Coinbase to report a per-share loss of $2.68 for its second quarter – compared to the per-share profit of $6.42 it earned in the year-ago period. Revenue is projected to arrive at $830.5 million (-53.2% YoY).

Bumble Stock Shines Ahead of Q2 Earnings

Bumble (BMBL (opens in new tab), $36.38) has been a bright light in 2022, with shares up 7.4% for the year-to-date – easily outperforming the broader market's roughly 13% loss.

"Bumble has been the best-performing stock in our digital media coverage as the online dating landscape has seen tailwinds from continued re-opening momentum with little macro impact to date," says Raymond James analyst Andrew Marok (Outperform).

The analyst believes BMBL's second-quarter results – slated for release after the Aug. 10 close – will be roughly in-line with company guidance, as data from Google Trends and Sensor Tower points to a solid environment for user growth. Although most other major apps in the sector saw quarter-over-quarter declines, Google Trends search volume for "bumble" was up 9% over Q1. As such, Marok believes Bumble added 50,000 paying users in Q2.

Consensus estimates for Bumble's second quarter are upbeat too. The company is expected to post a per-share loss of 1 cent, narrower than the 5 cents per share it lost in Q2 2021. Revenue is forecast to land at $219.4 million (+17.8% YoY).

Karee Venema
Contributing Editor, Kiplinger.com