Episode summary
Disney Says Film Studio’s Expenses Weigh on Current Quarter | Bloomberg Intelligence
Bloomberg Intelligence
· · Hosts: Paul Sweeney, Scarlet Fu · Guests: Geetha Ranganathan, Woo Jin Ho, Poonam Goyal
Summary
Disney’s fiscal fourth quarter looked mixed: parks and streaming were strong, but linear TV and the studio business continued to cloud the narrative. The media analyst said parks generate about 60% of profits and saw a 13% jump in operating profit, yet called the report “good, not great” because the company still has to offset weaker legacy television and an uneven film slate. Disney also said early traction on its ESPN streaming product and bundle strategy has been encouraging, with the analyst arguing bundling remains the main lever for subscriber growth, churn reduction and future pricing power.
Cisco’s results reinforced its AI story. The technology analyst said the company raised guidance, but still left second-half expectations below consensus, suggesting the outlook may be conservative. He highlighted strong networking demand, an ongoing upgrade cycle, and AI as an added growth layer rather than the core business.
In retail, the analyst argued athleisure remains a large and growing category, with Adidas positioned to lead a 2026 rebound. Nike still dominates the market, while Lululemon has struggled as product resonance weakens. Under Armour is trying to rebuild around product, tighter distribution and athlete marketing, but the analyst said execution must prove durable.
Key takeaways
- The media analyst said Disney’s parks business is healthy, but TV networks and studios are weighing on the company’s earnings narrative.
- Disney’s bundling strategy remains central, with the analyst saying 40% of new subscribers take the Disney bundle and that bundling should help reduce churn.
- The technology analyst said Cisco’s second-half outlook is below consensus, leaving room for upside if current momentum continues.
- Cisco’s AI business is still small relative to networking, but the analyst said it is growing quickly and supported by a strong balance sheet.
- The retail analyst said athleisure is still expanding globally and expects Adidas to lead category growth in 2026.
- Under Armour’s turnaround is early, and the analyst said product execution will determine whether the effort lasts.
Notable quotes
“everything if you look at the fundamental drivers of the company, which is really the parks business brings in about 60% of profits”
“they have the parks business, they have the streaming business which is doing really well from a profitability standpoint but to drag it down”
“the traction has been pretty good. They talked about the whole bundling strategy because that is where Disney really wins”
“when I look at the second half of uh um the year, um you know, they were $100 million below consensus expectations”
How the episode opens
Bloomberg Audio Studios podcasts, radio, news. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m.
Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Let's move on here um because we're talking about how the Dow industrials is outperforming the NASDAQ 100 for a third straight day.
So that uh move to go beyond MAG 7 is certainly taking place here at least recently. Although I look within the down industrials it is really Amgen and Cisco leading the way and the biggest drags on that measure are Caterpillar and Disney. So let's talk a little bit about Disney right now with our very own Gita Ranganathan.
She is our US media analyst for Bloomberg Intelligence. And Githa, you took a look at Disney's fiscal fourth quarter results. And your verdict is good, not great.
Yeah, that's exactly right. Uh Scarlet, it came off as a little bit of a lackluster report. I mean, everything if you look at the fundamental drivers of the company, which is really the parks business brings in about 60% of profits.
Things seem to be going pretty strong there. We saw a 13% jump in operating profit for the fiscal fourth quarter. Again the guidance for uh you know 2026 seems pretty good as well.
Uh but really you know Disney really has this very very tough balancing act. So on the one hand they have the parks business, they have the streaming business which is doing really well from a profitability standpoint but to drag it down you have the linear TV networks and then you have the hit and miss nature of you know uh the Bollywood I mean the Hollywood studio business.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- disney earnings
- media film studio expenses
- ai spending capex
- cisco forecast
- retail apparel margins
Companies and tickers mentioned
- DIS
- CSCO
- ADDYY
- NKE
- LULU
- META
- Walt Disney Co.
- Cisco Systems Inc.
- Adidas
- Nike
- Lululemon
- Puma
- Meta
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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