Disney Stock Dives After Earnings. Here's Why
Walt Disney stock is down Tuesday after the company came up short of revenue expectations for its fiscal second quarter. Here's what you need to know.


Walt Disney (DIS) stock is down nearly 10% midday Tuesday after the media and entertainment giant's revenue came up short of Wall Street's expectations for its fiscal second quarter.
In the three months ended March 30, Disney's revenue increased 1.2% year-over-year to $22.08 billion. Earnings per share (EPS) were up 30.1% to $1.21 from the year-ago period.
Disney's results were given a boost by strong numbers from Disney+ and Hulu, which each posted a profit for the first time ever in the March quarter. Additionally, Disney+ Core subscribers were up 6% compared to the end of 2023 to 117.6 million. ESPN, on the other hand, saw a 9% decline in operating income and a 2% drop in paid subscribers.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The top- and bottom-line results were mixed compared with analysts' expectations. According to CNBC, Wall Street was anticipating revenue of $22.11 billion and EPS of $1.10.
As a result of its impressive earnings results in the first six months of its fiscal year, Disney raised its full-year EPS outlook, now calling for 25% year-over-year growth vs its previous guidance of 20% growth.
"Our strong performance in Q2, with adjusted EPS up 30% compared to the prior year, demonstrates we are delivering on our strategic priorities and building for the future," Disney CEO Bob Iger said in a statement. "Our results were driven in large part by our Experiences segment as well as our streaming business. Importantly, entertainment streaming was profitable for the quarter, and we remain on track to achieve profitability in our combined streaming businesses in Q4."
Is Disney stock a buy, sell or hold?
Despite Disney's mixed results, analysts are still overwhelmingly bullish on the blue chip stock. According to S&P Global Market Intelligence, analysts' average target price for DIS stock is $126.48, representing implied upside of more than 20% to current levels. Additionally, the consensus recommendation is Buy.
BofA Securities is one of the firms with a Buy rating on Disney stock. It also has a $145 price target, representing implied upside of nearly 40% to current levels.
"DIS reported a solid fiscal second quarter with revenue essentially inline and operating income modestly ahead of our expectations," BofA analyst Jessica Reif Ehrlich said in a May 7 note. She adds that near-term catalysts for the Dow Jones stock include an inflection in profitability for its direct-to-consumer division and additional updates on the company's strategic priorities.
Today's pullback makes for an attractive buy-the-dip setup, says Don Montanaro, president of Firstrade. "Smart investors might want to buy Disney when it dips like it has today, and then patiently hold as the future dynamism of streaming revenues emerges over time," Montanaro says. "Imagine ESPN as a personalized streaming service including integrated social media interactions with star athletes plus easy gambling at viewers" fingertips. That's a differentiated, modern experience."
The executive adds that investors who share this long-term outlook and have plenty of patience should adopt a buy-and-hold strategy with Disney stock.
Related Content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
Is Your Social Security Earnings Record Wrong? Here's How to Fix It
Your Social Security benefits are based on your Social Security earnings record. It's important to review your records to avoid having your benefits reduced.
-
Stock Market Today: Markets Discount Another U.S. Downgrade
After Friday's closing bell, Moody's followed Standard & Poor's and Fitch and cut its rating on U.S. government debt.
-
Stock Market Today: Markets Discount Another U.S. Downgrade
After Friday's closing bell, Moody's followed Standard & Poor's and Fitch and cut its rating on U.S. government debt.
-
Donating Complex Assets Doesn't Have to Be Complicated
If you're looking to donate less-conventional assets but don't know where to start, this charity executive has answers, such as considering a donor-advised fund (DAF) for its tax benefits and ease of use.
-
What's Next for Stocks After a Chaotic Spring
A chaotic tariff policy buffets investors looking for clarity on the economy and inflation.
-
Think a Repeal of the Estate Tax Wouldn't Affect You? Wrong
The wording of any law that repeals or otherwise changes the federal estate tax could have an impact on all of us. Here's what you need to know, courtesy of an estate planning and tax attorney.
-
In Your 50s? We Need to Talk About Long-Term Care
Many people don't like thinking about long-term care, but most people will need it. This financial professional recommends planning for these costs as early as possible to avoid stress later.
-
Where to Invest in an Uncertain Market
In an uncertain market, you can still pocket juicy payouts ranging from 4% to 14%, depending on risk.
-
My First $1 Million: Events Industry CEO, 65, Northern New Jersey
Ever wonder how someone who's made a million dollars or more did it? Kiplinger's My First $1 Million series uncovers the answers.
-
Social Security Pop Quiz: Are You Among the 89% of Americans Who'd Fail?
Shockingly few people have any clue what their Social Security benefits could be. This financial adviser notes it's essential to understand that info and when it might be best to access your benefits.