Walt Disney Co
For the period ended Jun 29, 2024. Filed Aug 7, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 29, 2024 · Filed Aug 7, 2024
DIS$116.75-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-30; filed 2024-05-07.
0001744489-24-000152
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-29; filed 2024-08-07.
0001744489-24-000232
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 395 previous paragraphs and 411 current paragraphs.
197 unchanged; 109 reworded; 97 added; 79 removed; 10 previous and 8 current paragraphs rearranged.
Tables are not compared: 69 previous and 71 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (97)
Current report
Cost of services for the quarter increased 2%, or $0.3 billion, to $13.2 billion due to higher sports programming and production costs as well as increased volumes and the impact of inflation at our parks and experiences businesses, partially offset by lower non-sports programming and production costs.
Current report
In the prior-year quarter, the Company recorded charges of $2,650 million due to the Content Impairment and severance.
Current report
Other income (expense), net
Current report
Income from equity investees decreased $45 million, to $146 million from $191 million, due to lower income from A+E Television Networks.
Current report
The prior-year quarter loss before income taxes included the $2,440 million Content Impairment. In the prior-year quarter, income taxes included a benefit of approximately $568 million related to this charge. Due to the significance of this charge on pre-tax results, the effective tax rate for the prior-year quarter was negative 14.2%. In the current quarter, the Company recognized a $418 million tax benefit related to prior years’ tax matters (Income Tax Reserve Adjustments).
Current report
•Income Tax Reserve Adjustments of $418 million
Current report
•TFCF and Hulu Acquisition Amortization of $397 million
Current report
•Other expense of $65 million related to a legal ruling
Current report
•Restructuring and impairment charges of $2,650 million
Current report
•TFCF and Hulu Acquisition Amortization of $432 million
Current report
•Other expense, net of $11 million reflecting a charge of $101 million related to a legal ruling, partially offset by a DraftKings Gain of $90 million
Current report
Revenues for the current period increased $1.1 billion, to $68.8 billion; net income attributable to Disney increased $2.4 billion, to $4.5 billion; and EPS increased to $2.46 from $1.14 in the prior-year period. The EPS increase was due to higher operating income at Entertainment, a lower effective income tax rate, which included the benefit from the Income Tax Reserve Adjustments, and, to a lesser extent, growth at Experiences.
Current report
Depreciation and amortization decreased 6%, or $0.3 billion, to $3.7 billion due to lower TFCF and Hulu Acquisition Amortization and lower depreciation at our domestic theme parks and resorts.
Current report
Other income (expense), net
Current report
Income from equity investees decreased $87 million, to $468 million from $555 million, due to lower income from A+E Television Networks.
Current report
Income Taxes
Current report
Results for the nine months ended June 29, 2024 were impacted by the following:
Current report
•Income Tax Reserve Adjustments of $418 million
Current report
•TFCF and Hulu Acquisition Amortization of $1,282 million
Current report
•Other expense of $65 million related to a legal ruling
Current report
Results for the nine months ended July 1, 2023 were impacted by the following:
Current report
•Restructuring and impairment charges of $2,871 million
Current report
•TFCF and Hulu Acquisition Amortization of $1,569 million
Current report
Lower international advertising revenue was primarily due to a decrease of 7% from an unfavorable foreign exchange impact, partially offset by an increase of 5% from higher rates.
Current report
Selling, general, administrative and other costs decreased $73 million, to $604 million from $677 million due to lower marketing costs and a favorable foreign exchange impact.
Current report
Income from equity investees decreased $49 million, to $127 million from $176 million, due to lower income from A+E Television Networks attributable to a decrease in advertising revenue, higher marketing costs and lower affiliate revenue.
Current report
Operating income from Linear Networks decreased $59 million, to $966 million from $1,025 million, due to lower income from equity investees.
Current report
Higher advertising revenue reflected an increase of 29% from higher impressions at Disney+ and Hulu, partially offset by a decrease of 10% from lower rates. Higher impressions at Disney+ reflected an increase at Disney+ Core and the benefit of airing the International Cricket Council (ICC) T20 World Cup on Disney+ Hotstar in the current quarter. The previous ICC T20 World Cup occurred in the first quarter of fiscal 2023.
Current report
Domestic Disney+ average monthly revenue per paid subscriber decreased from $8.00 to $7.74 due to the impact of subscriber mix shifts.
Current report
International Disney+ (excluding Disney+ Hotstar) average monthly revenue per paid subscriber increased from $6.66 to $6.78 due to increases in retail pricing, partially offset by an unfavorable foreign exchange impact.
Current report
Disney+ Hotstar average monthly revenue per paid subscriber increased from $0.70 to $1.05 due to higher advertising revenue.
Current report
Hulu Live TV + SVOD average monthly revenue per paid subscriber increased from $95.01 to $96.11 due to higher advertising revenue.
Current report
Average Monthly Revenue Per Paid Subscriber - Third Quarter of Fiscal 2024 Comparison to Third Quarter of Fiscal 2023
Current report
Domestic Disney+ average monthly revenue per paid subscriber increased from $7.31 to $7.74 due to increases in retail pricing and, to a lesser extent, higher advertising revenue, partially offset by a higher mix of subscribers to multi-product, wholesale and ad-supported offerings.
Current report
International Disney+ (excluding Disney+ Hotstar) average monthly revenue per paid subscriber increased from $6.01 to $6.78 due to increases in retail pricing.
Current report
Hulu SVOD Only average monthly revenue per paid subscriber increased from $12.39 to $12.73 due to increases in retail pricing, partially offset by a higher mix of subscribers to multi-product offerings.
Current report
Hulu Live TV + SVOD average monthly revenue per paid subscriber increased from $91.80 to $96.11 due to increases in retail pricing, partially offset by a decrease in advertising revenue.
Current report
Selling, general, administrative and other costs increased $206 million, to $1,197 million from $991 million, driven by higher marketing costs.
Current report
The decrease in theatrical distribution revenue reflected fewer significant releases in the current quarter compared to the prior-year quarter. The current quarter included Inside Out 2 and Kingdom of The Planet of the Apes. The prior-year quarter included Guardians of the Galaxy Vol. 3, The Little Mermaid, Elemental and Indiana Jones And The Dial Of Destiny, which was released in most territories in the last few days of June 2023.
Current report
Revenues - Home entertainment distribution
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Removed paragraphs (79)
Previous report
Product revenues for the quarter increased 4%, or $0.1 billion, to $2.3 billion due to higher sales volumes of merchandise, food and beverage at our theme parks and resorts.
Previous report
Cost of services for the quarter decreased 4%, or $0.5 billion, to $12.7 billion due to lower programming and production costs and, to a lesser extent, lower distribution costs at Entertainment, partially offset by the impact of inflation and increased volumes at our theme parks and resorts.
Previous report
Cost of products for the quarter increased 4%, or $0.1 billion, to $1.5 billion due to inflation and higher sales volumes of merchandise, food and beverage at our theme parks and resorts.
Previous report
Selling, general, administrative and other costs increased 5%, or $0.2 billion, to $3.8 billion, primarily due to higher marketing costs.
Previous report
In the current quarter, the Company recorded charges of $2,052 million due to goodwill impairments related to the Star India Transaction and entertainment linear networks. In the prior-year quarter, the Company recognized charges of $152 million primarily for severance.
Previous report
Other income, net
Previous report
Income from equity investees decreased $32 million, to $141 million from $173 million, due to lower income from A+E Television Networks.
Previous report
The increase in the effective income tax rate was due to an unfavorable impact from the goodwill impairments recognized in the current quarter, which are not tax deductible, partially offset by a benefit from adjustments related to prior years, which were favorable in the current quarter and unfavorable in the prior-year quarter.
Previous report
•TFCF and Hulu acquisition amortization of $434 million
Previous report
•TFCF and Hulu acquisition amortization of $558 million
Previous report
•Restructuring and impairment charges of $152 million
Previous report
•Other income of $149 million due to the DraftKings gain
Previous report
Revenues for the current period increased $0.3 billion, to $45.6 billion; net income attributable to Disney decreased $0.7 billion, to $1.9 billion; and EPS decreased to $1.03 from $1.39 in the prior-year period. The EPS decrease was due to goodwill impairments in the current period, partially offset by higher operating income at Entertainment and Experiences.
Previous report
Product revenues for the current period increased 3%, or $0.2 billion, to $4.9 billion, due to higher sales volumes of merchandise, food and beverage at our theme parks and resorts.
Previous report
Cost of products for the current period increased 4%, or $0.1 billion, to $3.2 billion, due to inflation and higher sales volumes of merchandise, food and beverage at our theme parks and resorts.
Previous report
Depreciation and amortization decreased 5%, or $0.1 billion, to $2.5 billion due to lower TFCF & Hulu intangible amortization.
Previous report
Other income, net
Previous report
Income from equity investees decreased $42 million, to $322 million from $364 million, due to lower income from A+E Television Networks.
Previous report
Effective Income Tax Rate
Previous report
Results for the six months ended March 30, 2024 were impacted by the following:
Previous report
•TFCF and Hulu acquisition amortization of $885 million
Previous report
Results for the six months ended April 1, 2023 were impacted by the following:
Previous report
•TFCF and Hulu acquisition amortization of $1,137 million
Previous report
•Restructuring and impairment charges of $221 million
Previous report
Higher international advertising revenue was attributable to an increase of 10% from higher rates, partially offset by a decrease of 3% from an unfavorable foreign exchange impact.
Previous report
Higher advertising revenue in the current quarter compared to the prior-year quarter reflected an increase of 25% from higher impressions, partially offset by a decrease of 17% from lower rates.
Previous report
Average Monthly Revenue Per Paid Subscriber - Second Quarter of Fiscal 2024 Comparison to First Quarter of Fiscal 2024
Previous report
Domestic Disney+ average monthly revenue per paid subscriber decreased from $8.15 to $8.00 due to a higher mix of wholesale subscribers, partially offset by increases in retail pricing.
Previous report
International Disney+ (excluding Disney+ Hotstar) average monthly revenue per paid subscriber increased from $5.91 to $6.66 due to increases in retail pricing and a lower mix of subscribers to promotional offerings.
Previous report
Disney+ Hotstar average monthly revenue per paid subscriber decreased from $1.28 to $0.70 due to lower advertising revenue.
Previous report
Hulu Live TV + SVOD average monthly revenue per paid subscriber increased from $93.61 to $95.01 due to increases in retail pricing and a lower mix of subscribers to promotional offerings, partially offset by lower advertising revenue.
Previous report
Domestic Disney+ average monthly revenue per paid subscriber increased from $7.14 to $8.00 due to increases in retail pricing, partially offset by a higher mix of wholesale subscribers and of subscribers to multi-product offerings.
Previous report
International Disney+ (excluding Disney+ Hotstar) average monthly revenue per paid subscriber increased from $5.93 to $6.66 due to increases in retail pricing, partially offset by the addition of subscribers to ad-supported offerings.
Previous report
Hulu Live TV + SVOD average monthly revenue per paid subscriber increased from $92.32 to $95.01 due to increases in retail pricing, partially offset by lower advertising and premium add-on revenue.
Previous report
Selling, general, administrative and other costs increased $151 million, to $1,106 million from $955 million, due to higher marketing costs.
Previous report
Operating results from Direct-to-Consumer increased $634 million, to income of $47 million from a loss of $587 million, due to improved results at Disney+.
Previous report
Theatrical distribution revenue was lower as there were no significant titles released in the current quarter compared to Ant-Man And The Wasp: Quantumania in the prior-year quarter. The prior-year quarter also included the benefit of the ongoing performance of Avatar: The Way of Water, which was released in December 2022.
Previous report
Operating results from Content Sales/Licensing and Other decreased $101 million, to a loss of $18 million from income of $83 million due to lower theatrical distribution results and higher film cost impairments.
Previous report
The decrease in international ESPN affiliate revenue was due to decreases of 47% from an unfavorable foreign exchange impact and 7% from fewer subscribers, partially offset by an increase of 46% from higher contractual rates.
Previous report
Revenues - Other
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Reworded paragraphs (109)
Previous wording
•Current Six-Month Period Results Compared to Prior-Year Six-Month Period
Current wording
•Current Nine-Month Period Results Compared to Prior-Year Nine-Month Period
Previous wording
Revenues for the quarter increased 1%, or $0.3 billion, to $22.1 billion; net income attributable to Disney decreased to a loss of $20 million in the current quarter compared to income of $1.3 billion in the prior-year quarter; and diluted earnings per share (EPS) attributable to Disney decreased to a loss of $0.01 compared to income of $0.69 in the prior-year quarter. The EPS decrease was due to goodwill impairments in the current quarter, partially offset by higher operating income at Entertainment and Experiences.
Current wording
Revenues for the quarter increased 4%, or $0.8 billion, to $23.2 billion; net income attributable to Disney increased to income of $2.6 billion in the current quarter compared to a loss of $0.5 billion in the prior-year quarter; and diluted earnings per share (EPS) attributable to Disney increased to income of $1.43 compared to a loss of $0.25 in the prior-year quarter. The EPS increase was due to the comparison to the Content Impairment in the prior-year quarter and higher operating income at Entertainment in the current quarter.
Previous wording
Service revenues for the quarter increased 1%, or $0.2 billion, to $19.8 billion resulting from higher DTC subscription revenue and increased revenue at our theme parks and resorts. These increases were partially offset by lower theatrical distribution revenue and, to a lesser extent, lower TV/VOD distribution revenue.
Current wording
Service revenues for the quarter increased 4%, or $0.8 billion, to $20.8 billion resulting from higher DTC subscription revenue and, to a lesser extent, higher advertising revenue.
Previous wording
Depreciation and amortization decreased 5%, or $0.1 billion, to $1.2 billion driven by lower TFCF and Hulu acquisition amortization.
Current wording
Depreciation and amortization decreased 9%, or $0.1 billion, to $1.2 billion due to lower depreciation at our domestic theme parks and resorts and lower TFCF and Hulu Acquisition Amortization.
Previous wording
Other income, net in the prior-year quarter included a DraftKings gain of $149 million.
Current wording
Other expense in the current quarter reflected a charge of $65 million related to a legal ruling. Other expense, net in the prior-year quarter included a charge of $101 million related to a legal ruling, largely offset by the DraftKings Gain of $90 million.
Previous wording
The increase in interest expense was due to higher average rates, partially offset by higher capitalized interest.
Current wording
The increase in interest expense was due to higher average rates, partially offset by lower average debt balances.
Previous wording
The increase in interest income, investment income and other resulted from from higher interest income on cash balances and a favorable comparison of pension and postretirement benefit costs, other than service cost.
Current wording
The decrease in interest income, investment income and other reflected the impact of lower cash and cash equivalent balances, partially offset by a favorable comparison of pension and postretirement benefit costs, other than service cost.
Previous wording
The increase in net income attributable to noncontrolling interests was primarily due to improved results at Hong Kong Disneyland Resort, partially offset by the comparison to the accretion of NBCU’s interest in Hulu in the prior-year quarter with no accretion in the current quarter as we had fully accreted to the amount paid in December 2023 (see Note 1 to the Condensed Consolidated Financial Statements).
Current wording
The decrease in net income attributable to noncontrolling interests was primarily due to the comparison to the accretion of NBC Universal’s interest in Hulu in the prior-year quarter as we had accreted to the full guaranteed redemption value by December 2023.
Previous wording
CURRENT SIX-MONTH PERIOD RESULTS COMPARED TO PRIOR-YEAR SIX-MONTH PERIOD
Current wording
CURRENT NINE-MONTH PERIOD RESULTS COMPARED TO PRIOR-YEAR NINE-MONTH PERIOD
Previous wording
Service revenues for the current period increased $0.1 billion to $40.7 billion, resulting from higher DTC subscription revenue and increased revenue at our theme parks and resorts. These increases were largely offset by lower theatrical distribution revenue and, to a lesser extent, lower TV/VOD distribution revenue.
Current wording
Service revenues for the current period increased 2%, or $1.0 billion to $61.6 billion, resulting from higher DTC subscription revenue and increased revenues at our parks and experiences businesses. These increases were partially offset by lower theatrical distribution revenue and, to a lesser extent, lower TV/VOD distribution revenue.
Previous wording
Cost of services for the current period decreased 5%, or $1.4 billion, to $26.6 billion, primarily due to lower programming and production costs and, to a lesser extent, lower distribution costs at Entertainment, partially offset by the impact of inflation and increased volumes at our theme parks and resorts.
Current wording
Cost of services for the current period decreased 3%, or $1.1 billion, to $39.8 billion, primarily due to lower non-sports programming and production costs, and, to a lesser extent, lower technical support costs, partially offset by higher sports programming and production costs and the impact of inflation and increased volumes at our parks and experiences businesses.
Previous wording
In the current period, the Company recorded charges of $2,052 million due to goodwill impairments related to the Star India Transaction and entertainment linear networks.
Current wording
In the current period, the Company recorded $2,052 million of charges for goodwill impairments related to the Star India Transaction and entertainment linear networks.
Previous wording
In the prior-year period, the Company recorded charges of $221 million primarily for severance and costs related to exiting our businesses in Russia.
Current wording
In the prior-year period, the Company recorded $2,871 million of charges including the Content Impairment, severance and costs related to exiting our businesses in Russia.
Previous wording
Other income, net in the prior-year period included a DraftKings gain of $79 million and a $28 million gain on the sale of a business.
Current wording
Other expense in the current period reflected a charge of $65 million related to a legal ruling. Other income, net in the prior-year period included a DraftKings Gain of $169 million and a $28 million gain on the sale of a business, partially offset by a charge of $101 million related to a legal ruling.
Previous wording
The increase in the effective income tax rate was due to an unfavorable impact from the goodwill impairments recognized in the current period, which are not tax deductible, partially offset by a lower effective tax rate on foreign earnings in the current period.
Current wording
The effective income tax rate in the current period was comparable to the U.S. statutory rate as an unfavorable impact from the current period goodwill impairments, which are not tax deductible, was largely offset by a benefit from the Income Tax Reserve Adjustments. The effective income tax rate in the prior-year period was higher than the U.S. statutory rate primarily due to a higher effective tax rate on foreign earnings.
Previous wording
The increase in net income from continuing operations attributable to noncontrolling interests was due to improved results at our Asia Theme Parks, the accretion of Hulu’s noncontrolling interest to the amount paid in December 2023 (see Note 1 to the Condensed Consolidated Financial Statements) and improved results at ESPN, partially offset by the impact of the purchase of Major League Baseball’s 15% interest in BAMtech LLC in the prior-year period.
Current wording
The increase in net income attributable to noncontrolling interests was due to improved results at our Asia Theme Parks and ESPN, partially offset by the comparison to the accretion for Major League Baseball’s interest in BAMTech LLC and NBCU’s interest in Hulu. We had accreted to the redemption value for BAMTech LLC by November 2022 and to the guaranteed redemption value for Hulu by December 2023.
Previous wording
Certain Items Impacting Results in the Six Month Period
Current wording
Certain Items Impacting Results in the Nine Month Period
Previous wording
•Other income of $107 million due to the DraftKings gain of $79 million and a gain on the sale of a business of $28 million
Current wording
•Other income, net of $96 million reflecting a DraftKings Gain of $169 million and a gain on the sale of a business of $28 million, partially offset by a charge of $101 million related to a legal ruling
Previous wording
The Company’s businesses are subject to the effects of seasonality. Consequently, the operating results for the six months ended March 30, 2024 for each business segment, and for the Company as a whole, are not necessarily indicative of results to be expected for the full year.
Current wording
The Company’s businesses are subject to the effects of seasonality. Consequently, the operating results for the nine months ended June 29, 2024 for each business segment, and for the Company as a whole, are not necessarily indicative of results to be expected for the full year.
Previous wording
(1)Reflects fees paid by Direct-to-Consumer to Sports and other Entertainment businesses for the right to air their linear networks on Hulu Live and fees paid by Entertainment to Sports to program sports on the ABC Network and Star+.
Current wording
(1)Reflects fees paid by Direct-to-Consumer to Sports and other Entertainment businesses for the right to air their linear networks on Hulu Live and fees paid by Entertainment to Sports to program sports on the ABC Network and Disney+.
Previous wording
The following table presents income from our operating segments and other components of income before income taxes:
Current wording
The following table presents income from our operating segments and other components of income (loss) before income taxes:
Previous wording
The increase in operating income in the current quarter compared to the prior-year quarter was due to improved results at Direct-to-Consumer, partially offset by declines at Linear Networks and Content Sales/Licensing and Other.
Current wording
The increase in Entertainment operating income in the current quarter compared to the prior-year quarter was due to improved results at Direct-to-Consumer and Content Sales/Licensing and Other.
Previous wording
The decrease in domestic affiliate revenue was primarily due to a decrease of 12% from fewer subscribers, including the impact of the non-renewal of carriage of certain networks by an affiliate, partially offset by an increase of 7% from higher contractual rates.
Current wording
The decrease in domestic affiliate revenue was due to a decline of 13% from fewer subscribers, including the impact of the non-renewal of carriage of certain networks by an affiliate, partially offset by an increase of 7% from higher effective rates.
Previous wording
Lower international affiliate revenue was primarily attributable to decreases of 11% from fewer subscribers and 4% from lower contractual rates.
Current wording
Lower international affiliate revenue was attributable to decreases of 8% from fewer subscribers and 4% from an unfavorable foreign exchange impact.
Previous wording
The decline in domestic advertising revenue was due to a decrease of 12% from fewer impressions, partially offset by an increase of 3% from higher rates primarily due to increased political advertising at the owned television stations. The decrease in impressions was due to lower average viewership.
Current wording
The decline in domestic advertising revenue was due to a decrease of 15% from lower impressions attributable to a decline in average viewership, partially offset by an increase of 1% from higher rates.
Previous wording
The decrease in domestic programming and production costs was due to a lower average cost mix of programming at ABC Network, partially offset by an increase in the average cost of programming at FX Channels.
Current wording
The decrease in domestic programming and production costs was attributable to a lower average cost mix of programming and a decrease in program write-downs.
Previous wording
Growth in subscription fees in the current quarter compared to the prior-year quarter reflected increases of 9% from higher rates attributable to increases in retail pricing at Disney+ Core and Hulu, and 6% from more subscribers due to growth at Disney+ Core.
Current wording
Growth in subscription fees reflected increases of 10% from higher rates attributable to increases in retail pricing at Disney+ Core and Hulu, and 7% from more subscribers due to growth at Disney+ Core and, to a lesser extent, Hulu, partially offset by a decrease of 3% from an unfavorable foreign exchange impact.
Previous wording
In addition to revenue, costs and operating income, management uses the following key metrics to analyze trends and evaluate the overall performance of Disney+(1) and Hulu(1), and we believe these metrics are useful to investors in analyzing the business:
Current wording
In addition to revenue, costs and operating income, management uses the following key metrics(1) to analyze trends and evaluate the overall performance of Disney+ and Hulu, and we believe these metrics are useful to investors in analyzing the business:
Previous wording
(1)See discussion on pages 71-72 —DTC Product Descriptions, Key Definitions and Supplemental Information.
Current wording
(1)See discussion on pages 72-73 — DTC Product Descriptions, Key Definitions and Supplemental Information.
Previous wording
Average Monthly Revenue Per Paid Subscriber - Second Quarter of Fiscal 2024 Comparison to Second Quarter of Fiscal 2023
Current wording
Average Monthly Revenue Per Paid Subscriber - Third Quarter of Fiscal 2024 Comparison to Second Quarter of Fiscal 2024
Previous wording
Hulu SVOD Only average monthly revenue per paid subscriber decreased from $12.29 to $11.84 due to lower advertising revenue, partially offset by increases in retail pricing.
Current wording
Hulu SVOD Only average monthly revenue per paid subscriber increased from $11.84 to $12.73 due to higher advertising revenue.
Previous wording
Disney+ Hotstar average monthly revenue per paid subscriber increased from $0.59 to $0.70 due to increases in retail pricing, partially offset by a higher mix of subscribers from lower-priced markets and lower advertising revenue.
Current wording
Disney+ Hotstar average monthly revenue per paid subscriber increased from $0.59 to $1.05 due to increases in retail pricing and higher advertising revenue, partially offset by a higher mix of subscribers from lower-priced markets.
Previous wording
Higher programming and production costs at Hulu in the current quarter compared to the prior-year quarter were primarily due to higher subscriber-based fees for programming the Hulu Live TV service and more programming provided on the service, partially offset by lower average costs per hour of content available on the service. The increase in Hulu Live TV subscriber-based fees was attributable to rate increases and more subscribers.
Current wording
Higher programming and production costs at Hulu in the current quarter compared to the prior-year quarter were due to higher subscriber-based fees for programming the Hulu Live TV service primarily attributable to rate increases.
Previous wording
Programming and production costs at Disney+ and other in the current quarter were comparable to the prior-year quarter as lower average costs per hour of content available was offset by more content provided on the service.
Current wording
The increase in programming and production costs at Disney+ and other in the current quarter compared to the prior-year quarter was driven by the timing of the ICC T20 World Cup, partially offset by lower costs for non-sports content available on Disney+ Core.
Previous wording
The decrease in other operating expense was due to lower distribution costs.
Current wording
The decrease in other operating expense was primarily due to lower distribution costs.
Previous wording
The operating loss from Direct-to-Consumer decreased $1,480 million, to $91 million from $1,571 million, due to a lower loss at Disney+ and, to a lesser extent, higher operating income at Hulu.
Current wording
The operating loss from Direct-to-Consumer decreased $486 million, to $19 million from $505 million, due to improved results at Disney+.
Previous wording
The decrease in TV/VOD distribution revenue was attributable to lower sales of episodic content.
Current wording
The increase in TV/VOD distribution revenue was due to higher sales of episodic content.
Previous wording
The decrease in programming and production costs was due to lower production cost amortization attributable to the decreases in theatrical and TV/VOD distribution revenues, partially offset by higher film cost impairments in the current quarter.
Current wording
The decrease in programming and production costs was due to lower production cost amortization attributable to the decreases in theatrical and home entertainment distribution revenues.
Previous wording
The decrease in distribution costs and cost of goods sold was attributable to lower theatrical distribution costs.
Current wording
The decrease in distribution costs and cost of goods sold was primarily due to lower home entertainment unit sales.
Previous wording
Selling, general, administrative and other costs decreased $168 million, to $382 million from $550 million, driven by lower theatrical marketing costs reflecting the absence of significant releases in the current quarter.
Current wording
Selling, general, administrative and other costs decreased $190 million, to $562 million from $752 million, primarily attributable to lower theatrical marketing costs reflecting fewer significant releases in the current quarter.
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Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
The increase in interest expense was due to higher average rates, partially offset by lower average debt balances.
Current report — wording carried from elsewhere
The increase in interest income, investment income and other was driven by a favorable comparison of pension and postretirement benefit costs, other than service cost, and larger investment gains in the current period compared to the prior-year period.
Current report — wording carried from elsewhere
The increase in Entertainment revenues was due to subscription revenue growth.
Current report — wording carried from elsewhere
Operating Loss from Direct-to-Consumer
Current report — wording carried from elsewhere
Operating Income (Loss) from Content Sales/Licensing and Other
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The following table presents supplemental revenue and operating income detail for the Experiences segment:
Current report — wording carried from elsewhere
(1)Charges for the prior-year period were due to severance.
Current report — wording carried from elsewhere
(2)Total may not equal the sum of the column due to rounding.
Rearranged previous paragraphs (10)
Previous report — wording carried elsewhere
•Restructuring and impairment charges of $2,052 million
Previous report — wording carried elsewhere
The decrease in Entertainment revenues was primarily due to lower theatrical distribution revenue and, to a lesser extent, a decrease in TV/VOD distribution revenue, partially offset by subscription revenue growth.
Previous report — wording carried elsewhere
Operating Income (Loss) from Direct-to-Consumer
Previous report — wording carried elsewhere
Average Monthly Revenue Per Paid Subscriber - Second Quarter of Fiscal 2024 Comparison to Second Quarter of Fiscal 2023
Previous report — wording carried elsewhere
Higher international advertising revenue was due to an increase of 6% from higher rates, partially offset by a decrease of 3% from an unfavorable foreign exchange impact.
Previous report — wording carried elsewhere
The decrease in other operating expenses was driven by lower technology and distribution costs.
Previous report — wording carried elsewhere
Operating income from Linear Networks decreased $301 million, to $1,988 million from $2,289 million, due to decreases at our domestic and international businesses.
Previous report — wording carried elsewhere
Operating Loss from Content Sales/Licensing and Other
Previous report — wording carried elsewhere
The following table presents supplemental revenue and operating income (loss) detail for the Experiences segment:
Previous report — wording carried elsewhere
Significant judgments and assumptions in the discounted cash flow model used to determine fair value relate to future revenues and certain operating expenses, terminal growth rates and discount rates. Changes to these assumptions, shifts in market trends, or the impact of macroeconomic events could produce test results in the future that differ, and we could be required to record additional impairment charges.