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Disney shares rise 12% after earnings reports and partnership with Epic Games

David Boulder
8. 2. 2024
2 min read

Shares of the Walt Disney Company are up 12%, after posting surprisingly strong first quarter results that beat analysts' expectations and announcing major business moves, including a partnership with Epic Games.

The first key point is beating expectations in the results for the first quarter, with earnings per share of $1.22 versus the forecast of 99 cents. This result was positively received by the market and raised hopes for further growth for the company. At the same time, Disney announced a dividend of 45 cents per share, representing an increase of 50% from the previous payout.

DIS

Disney

DIS
$111.93 $0.35 +0.31%
1 Day
+0%
5 Days
-3.91%
1 Month
+14.79%
6 Months
+25.41%
YTD
+18.66%
1 Year
+5.81%
5 Years
-5.24%
Max.
+115,756.55%

The second key point is partnership with Epic Games, known for the popular game Fortnite. The partnership is valued at $1.5 billionand aims to create new games using well-known Disney brands, including Disney, Pixar, Marvel, Star Wars and Avatar. This initiative is aimed at reaching new segments and strengthening the company's position in the gaming industry.

While Disney has lost customers on its streaming platform Disney+, but also saw increased revenue due to increased subscription costs. The company also announced a plan to to cut costs by the end of fiscal year 2024 and forecasts earnings per share of around USD 4.60.

Technology analyst Ben Barringer noted that the results Disney show steady revenue and successful cost management. However, new business moves, particularly the partnership with Epic Games, may require patience before they bear full fruit.

"Disney anticipates modest revenue growth while focusing on cost-saving measures to ensure profitability for its shareholders. This strategy is gaining support from investors, despite ongoing difficulties in theme park operations and the continued decline of linear television."
Ben Barringer, technology analyst
DIS

Disney

DIS
$111.93 $0.35 +0.31%
Target Price
149.47 (+33.54% Upside)

Disney and Bob Iger are looking to showcase their ability to to innovate and grow at a time when the company is struggling to adapt dynamic changes in the entertainment and gaming industries.

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Source.


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