Date: February 2, 2026
Ticker: NYSE: DIS
Topic: Q1 Fiscal 2026 Earnings Summary
Earnings Summary
- Revenue: Disney reported revenues of $25.98 billion, beating analyst expectations of ~$25.54 billion by approximately 1.7%. This represents a 5% increase year-over-year compared to $24.69 billion in Q1 FY2025.
- EPS: Adjusted diluted EPS came in at $1.63, surpassing the consensus estimate of $1.57 by roughly 4%. However, this reflects a 7% decline from the $1.76 reported in the same quarter last year, largely due to difficult comparisons in the Entertainment segment.
- Net Income: Net income attributable to Disney was $2.40 billion, a 6% decrease from $2.55 billion in the prior-year quarter.
- Streaming Profitability: Entertainment SVOD operating income surged 72% to $450 million, with margins improving to 8.4%.
- Experiences Strength: The Experiences segment (Parks) delivered record revenue of $10.0 billion (+6% YoY) and operating income of $3.3 billion (+6% YoY), defying fears of a sharper slowdown.
Financials: The Walt Disney Company (Q1 FY2026)
Market Context
Disney’s results arrive in a complex environment where legacy media assets are under pressure, but digital pivots are beginning to bear fruit. The company’s ability to grow streaming profits while maintaining pricing power in its theme parks has been a key thesis for bulls. The “bifurcated” nature of the results—strong streaming and parks performance offset by linear TV declines and theatrical volatility—reflects the broader industry transition.
| (Figures in millions of dollars unless otherwise indicated) | Q1 FY2026 | Q1 FY2025 | % Change (YoY) |
| Revenue | $25,981 | $24,690 | +5% |
| Net Income | $2,402 | $2,554 | -6% |
| Adjusted EPS | $1.63 | $1.76 | -7% |
| Segment Op. Income | $4,600 | $5,060 | -9% |
| Cash from Ops | $735 | $3,205 | -77% |
| Free Cash Flow | –$2,278 | $739 |
Theatrical Headwinds: Entertainment segment operating income fell 35% to $1.1 billion. This was driven by higher marketing costs for major releases like Zootopia 2 and Avatar: Fire and Ash, and difficult comparisons to the prior year’s slate.
Cash Flow Timing: The sharp drop in operating cash flow (down 77%) was largely due to the timing of tax payments related to California wildfire relief, which shifted liabilities into this quarter.
Sports Stability: Sports revenue was flat (+1%), but operating income fell 23% due to higher rights costs (NBA) and the impact of a temporary YouTube TV carriage dispute.
Outlook: Q2 FY2026 & Full Year
Management provided detailed guidance for the upcoming quarter and fiscal year, reinforcing confidence in long-term growth targets.
- Q2 FY2026:
- Entertainment: Operating income expected to be comparable to Q2 FY2025.
- Streaming: SVOD operating income projected to reach ~$500 million (up $200M YoY).
- Sports: Operating income expected to decline by ~$100 million due to higher rights expenses.
- Full Year FY2026:
- EPS Growth: Reaffirmed target for double-digit adjusted EPS growth compared to FY2025.
- Cash Flow: Targeting $19 billion in cash provided by operations.
- Share Buybacks: On track to repurchase $7 billion of stock, doubling the FY2025 pace.
Market & Price Trends
Despite the earnings beat, Disney shares dipped approximately 2.8% in pre-market trading immediately following the release. Investors appeared to weigh the strong quarterly beat against the soft Q2 guidance for the Sports segment and the temporary drag on free cash flow. However, the stock remains in a tight trading range ($100-$120), looking for a catalyst to break out.
This content is for informational purposes only and does not constitute financial advice; always conduct your own research before making investment decisions.