Disney F3Q26 Ahead on SOI and Adj. EPS with Solid KPIs; Full Year Outlook Maintained

Research evidence excerpt

J P M O R G A N

North America Equity Research

05 August 2026

Disney

F3Q26 Ahead on SOI and Adj. EPS with Solid KPIs;

Full Year Outlook Maintained

Disney’s F3Q results were ahead on SOI and adj. EPS, with good performance on

KPIs while the full year outlook was maintained. Segment Operating Income of

$5.555b compared to guidance of $5.3b with the beat mainly on Experiences

(revenue and margin) and Entertainment (margin). The SOI drove better adj. EPS

of $2.06 (JPMe/CON $1.85/$1.86), and we estimate below-the-line items, mainly

a lower tax rate, helped by around $0.10. Looking more closely at Experiences,

domestic attendance improved to +3% y/y, with the release calling out healthy

‘core’ increases from tourists and passholders, and effective promotions and new

attractions. Admissions drove the revenue beat relative to our model, while

segment OI also benefitted from a ~$100m tariff refund. At Entertainment, SVOD

revenue growth of 11% was in line to our expectation; margin of 13% was ahead

(JPMe 10.5%), though the print called out some benefit from timing of marketing

and content spend. Sports OI declined 17%, missing the guide which was attributed

to a carriage dispute (i.e. Comcast / NFL Network) and some shorter playoff series

in the early rounds. Full year EPS growth including and excluding the 53rd week

was maintained at +12%/16%. Comparisons to consensus are difficult given the

extra week dynamic, though the implied adj. EPS of ~$1.39 for F4Q (52-week)

compares to JPMe $1.59; in the release, Disney noted an impact from Moana and

a softer-than-expected ad environment, particularly in domestic SVOD.

DIS reiterates FY26 guidance, increases buyback on A+E sale. DIS

reiterated FY26 adj. EPS growth at ~12% y/y ex-53rd week (~16% including

53rd week). Q4 total segment OI is now guided to ~$4.9b including ~$600m

from the 53rd week, with the underlying ~$4.3b expected below our $4.67b.

By segment, the company nudged the Experiences OI to the high end of the

prior guidance for HSD% ex-53rd week and reiterated the outlook for Sports

and Entertainment OI. Buyback was raised to at least $9b, up from $8b prior,

reflecting $1.2b proceeds from the A+E sale.…