Get the CNBC Sport newsletter directly to your inboxThe CNBC Sport newsletter with Alex Sherman brings you the biggest news and exclusive interviews from the worlds of sports business and media, delivered weekly to your inbox.
Subscribe here to get access today.
Disney knows that business, like football, is a contact sport. Sometimes the hits come in-house from feuding among executives. Sometimes they come in court, from battling the Federal Communications Commission.
And sometimes, Disney, which owns ABC, takes hits from its own affiliates.
ABC station owners are irritated with Disney's recent decision to air the Super Bowl on many different platforms, including Disney+, ESPN2, NFL Network and ESPNU. The game is already airing on both ABC and ESPN. The aggregate of the different platforms may drop advertising revenue associated with broadcast viewership by up to 35% compared to last year, according to a station group CEO who asked not to be named because the data is private.
Disney has the broadcast rights to this season's Super Bowl. ABC hasn't had the Super Bowl since 2006. Disney got back in the Super Bowl rotation when it struck its most recent media rights deal with the NFL in 2021.
The Super Bowl is a major moneymaker for ABC stations. Some of these are owned by Disney, but the vast majority are part of local station groups owned by companies such as Sinclair, Nexstar and Tegna.
Fox said last year that Super Bowl ads generated more than $800 million in gross revenue across all platforms. The math for the main broadcast network is simple. There are about 85 30-second spots during a standard game. At $8 million a pop on average, that's $680 million.
Most advertising campaigns are national, but some brands buy big markets only. That allows smaller markets to sell advertising locally.
An average primetime audience is around eight million viewers. So, if the Super Bowl gets 15 times the audience, advertising rates increase in lockstep. Super Bowl LX, held in February, had 125.6 million viewers.
About 3% of a typical local affiliate station's annual advertising revenue comes from the Super Bowl when the game is on its air, according to a person familiar with the matter. The number can be much higher for the owned-and-operated big market stations, which typically take in about $10 million in advertising revenue from the Super Bowl, according to a source familiar with the matter.
Local affiliate stations pay the owners of the broadcast networks — Disney for ABC, Comcast for NBC, Fox for Fox and Skydance for CBS — a so-called reverse retransmission fee for the right to carry network programming.
There's a standard process to retransmission fee discussions. Disney pays billions for live sports and then asks its affiliates for money to help pay for them. The affiliates then negotiate with the pay-TV providers and charge them retrans fees.
This is why the broadcast affiliates are steaming. For decades, the Super Bowl was exclusive to broadcast TV. Getting access to the Big Game was a big part of that fee.
For years, media companies have made the Super Bowl available for both broadcast and streaming audiences. Still, this year, Disney has taken a wrecking ball to the broadcast exclusivity of the past.
Disney's different optionsGiven the game is an ESPN production with ESPN's primary "Monday Night Football" announcing crew — Joe Buck and Troy Aikman — it's reasonable to assume the cable network will get a fair amount of viewership for the game.
Disney is also putting the game on Disney+ — a streaming service that's never been about sports. Airing the Super Bowl on a streaming service isn't new. NBCUniversal's Peacock, Fox's Tubi and Skydance's Paramount+ have streamed the game in the past. But those services allow for geofenced dynamic advertising insertion (DAI), allowing local affiliates to sell commercials to a streaming audience. Disney+, which doesn't typically air live ABC sports programming, doesn't have DAI.
Disney is also airing so-called "alt-casts" of the game on ESPN2 (Eli and Peyton Manning will do their typical "ManningCast"), ESPNU ("Super Bowl LXI Field Pass with The Pat McAfee Show"), and NFL Network ("Super Bowl LXI Playbook with Next Gen Stats").
Disney is even airing a "Star Wars"-themed alt-cast on Disney Channel and Disney XD. The "Star Wars" alternative broadcast will also be on Disney+.
The commercials that run nationally will be the same on all platforms, according to a Disney spokesperson. The "Star Wars" alt-cast will be ad-free.
Disney wants to synergize its platforms to maximize viewership — and collect the ad revenue.
"The Super Bowl is the year's most-watched telecast, and our broad distribution across ESPN, ABC, and Disney+ will give fans everywhere more ways than ever to enjoy the game," according to a statement provided by a Disney spokesperson. "Making marquee live events available via streaming is a well-established industry practice. Fox and NBC have recently offered the Super Bowl on Tubi and Peacock, and we've similarly streamed 'The Oscars' on Hulu and 'Dancing with the Stars' on Disney+, for example. There's nothing unprecedented about this approach as we are meeting the modern consumer where they are."
Still, the totality of it all will certainly lower broadcast viewership. One station group CEO estimated local advertising revenue associated with the game may fall 35%. That executive declined to be named because the analysis is private.
"Any time you fragment distribution, you're destroying value for each of the individual platforms," a station group CEO told me, who asked not to be named for fear of potential retribution. "I don't have a problem with what Disney is doing — I have a problem that there's no acknowledgement that we're losing money."
Affiliate board involvementThis issue of lower broadcast Super Bowl viewership, and associated advertising revenue, is of so much concern that it's currently being discussed at the affiliate board — an elected body of executives across the TV broadcasting industry who act as liaisons between local stations and their parent network (Disney/ABC, in this case).
It's unclear exactly how affiliates may be compensated, if at all.
The decline in traditional TV viewership is pushing Disney to broaden its coverage to new platforms and new audiences that don't watch cable or broadcast TV.
Station executives want Disney to lean in to what continues to be a profitable, albeit declining, business. Several of those executives told me privately they think Disney is doing itself and the broader linear TV ecosystem a disservice by not banding together with affiliates to keep viewers on broadcast platforms.
"Our ABC affiliates are important partners and we always take that into careful consideration when making these decisions," said a Disney spokesperson. "We've successfully navigated similar situations in collaboration with the governing board many times before, and this is no different."
The chairman of the ABC Television Affiliates Association Board of Governors declined to comment.
Walt Disney (DIS - Free Report) closed the most recent trading day at $113.13, moving +1.16% from the previous trading session. The stock's change was more than the S&P 500's daily loss of 1.21%. Elsewhere, the Dow gained 0.02%, while the tech-heavy Nasdaq lost 2.6%.
Shares of the entertainment company have appreciated by 8.09% over the course of the past month, outperforming the Consumer Discretionary sector's gain of 2.48%, and the S&P 500's loss of 0.03%.
The investment community will be closely monitoring the performance of Walt Disney in its forthcoming earnings report. The company is scheduled to release its earnings on November 17, 2026. The company is predicted to post an EPS of $1.68, indicating a 51.35% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $25.3 billion, indicating a 12.62% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $6.92 per share and revenue of $101.65 billion, which would represent changes of +16.69% and +7.65%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for Walt Disney. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.08% rise in the Zacks Consensus EPS estimate. Walt Disney is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, Walt Disney is presently being traded at a Forward P/E ratio of 14.95. This represents a premium compared to its industry average Forward P/E of 13.76.
We can also see that DIS currently has a PEG ratio of 1.29. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As the market closed yesterday, the Media Conglomerates industry was having an average PEG ratio of 1.29.
The Media Conglomerates industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 189, which puts it in the bottom 24% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow DIS in the coming trading sessions, be sure to utilize Zacks.com.
"Glee," the hit musical comedy-drama television series, is set to return in a reboot, streaming services Disney+ and Hulu announced on Wednesday.
"It's official, Glee is returning," the platforms said in a joint Instagram post, though they provided no additional details about the project or its release timeline.
The reboot revives Ryan Murphy's television series, which premiered on Fox in 2009 and ran for six seasons through 2015. Set in Lima, Ohio, the show followed members of a high school glee club as they navigated adolescence, friendships and personal challenges.
The series featured a cast that combined established actors and emerging talent, including Lea Michele, Cory Monteith, Matthew Morrison, Jane Lynch and Darren Criss.
"Glee" became a cultural phenomenon, earning Golden Globe awards for best television series, comedy or musical, in 2010 and 2011. The show was known for its wide-ranging musical performances, covering songs such as Journey's "Don't Stop Believin,'" Michael Jackson's "Smooth Criminal" and Queen's "Bohemian Rhapsody," while also popularizing mash-up numbers that blended multiple songs into a single performance.
The series has also been associated with the deaths of three cast members: Cory Monteith, who played Finn Hudson, died in 2013; Mark Salling, who portrayed Noah Puckerman, died in 2018; and Naya Rivera, who played Santana Lopez, died in 2020.
Skydance shares staged a sharp single-day reversal after weeks of relentless post-merger selling, but whether buyers or sellers control the newly combined studio giant depends on what the integration numbers reveal next.
The steep post-merger slide in Skydance (NYSE:SKYD) shares is taking a pause. Shares of Skydance are up 5% to $7.15 this afternoon, a rebound that breaks a stretch of sustained selling. That gain stands out against much smaller moves elsewhere in entertainment.
Meanwhile, Walt Disney (NYSE:DIS | DIS Price Prediction) shares are up 2% to $111.41, a softer advance that trails the Skydance rebound. Disney stock keeps the entertainment group in positive territory with its move, while Skydance stock stands out as the clear exception.
Post-Merger Selling Gives Way to a Rebound Skydance stock is bouncing after a steep slide that began once its acquisition of Warner Bros. Discovery closed on October 6. This rebound reads as a pause in that sustained selling pressure, as sellers had held the upper hand in Skydance shares for most of the stretch since the transaction wrapped up.
When the Warner Bros. Discovery deal closed, Skydance’s ticker changed to SKYD and its listing moved to the New York Stock Exchange. Paramount Global and Skydance Media combined earlier to form the company, and the latest deal adds a second major studio to that base. Under the new symbol, Skydance shares have spent most of their time moving lower.
Fund Figures Point to a Skydance-Specific Move A look at the fund figures shows how isolated the Skydance move is. The Communication Services Select Sector SPDR ETF (NYSEARCA:XLC) is up 0.1% to $110.19, a near-flat showing next to the Skydance rebound. At the same time, the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is up 0.4% to $769.45, representing a modest gain for the broad market.
The XLC ETF’s biggest weights sit in internet and advertising giants, which means entertainment stocks drive only part of the fund’s direction. Individual media stocks like Skydance can swing sharply and still leave a sector fund reading flat.
Three Business Models Under One Sector Label Skydance runs Paramount+ and Pluto TV, the Paramount Pictures studio and the CBS network, a mix that spans streaming, film and broadcast television. Its brand lineup also includes cable networks such as MTV, Nickelodeon and Comedy Central. Paramount+ carries live sports including the NFL and UFC. Pluto TV adds a free, ad-supported streaming option alongside the paid Paramount+ service.
Disney pairs streaming with parks, combining Disney+, Hulu and ESPN with theme parks, cruises and consumer products. Physical attractions give Disney revenue streams that reach well beyond screens. ESPN adds a live sports anchor to that streaming lineup. That gives Disney a second link to the kind of programming Paramount+ also goes after.
Netflix (NASDAQ:NFLX) is a pure-play streamer. That single focus sets Netflix apart from Skydance and Disney, which each layer streaming onto older businesses, and those differences help explain why Skydance, Disney and Netflix shares can move independently on any given day. NFLX stock is down 0.62% to $69.42.
Integration Is the Next Test for Skydance Skydance faces a key question now: whether combining the Warner Bros. Discovery assets with its own studios steadies the stock. Folding those film, television and streaming operations together is a large undertaking for the newly combined company. Skydance now houses Paramount Pictures and the Warner Bros. Discovery studios under one corporate roof.
A single up day still leaves most of the steep post-merger decline in Skydance stock in place. Disney shares, with their softer gain, offer a firmer read on entertainment sentiment. Shareholders can watch for whether Skydance stock holds its gains as the integration moves forward.
Contact [email protected] for any questions or corrections.
The Walt Disney Company (NYSE: DIS - Get Free Report) EVP Brent Woodford sold 2,856 shares of the business's stock in a transaction dated Friday, October 16th. The shares were sold at an average price of $111.68, for a total transaction of $318,958.08. Following the completion of the sale, the executive vice president directly owned 62,995
The Walt Disney Company (NYSE:DIS – Get Free Report) has been assigned an average rating of “Moderate Buy” from the twenty-two research firms that are currently covering the company, Marketbeat reports. One equities research analyst has rated the stock with a sell rating, three have issued a hold rating, seventeen have assigned a buy rating and one has issued a strong buy rating on the company. The average twelve-month target price among brokerages that have issued ratings on the stock in the last year is $128.16.
DIS has been the topic of several analyst reports. The Goldman Sachs Group reaffirmed a “buy” rating on shares of Walt Disney in a research note on Monday, September 28th. Wall Street Zen raised shares of Walt Disney from a “hold” rating to a “buy” rating in a research report on Saturday, September 19th. Rosenblatt Securities reissued a “buy” rating and issued a $126.00 price objective on shares of Walt Disney in a research report on Thursday, August 6th. JPMorgan Chase & Co. raised their target price on Walt Disney from $139.00 to $140.00 and gave the company an “overweight” rating in a research note on Tuesday, June 30th. Finally, Benchmark restated a “buy” rating on shares of Walt Disney in a research note on Monday, August 31st.
Read Our Latest Research Report on DIS
Walt Disney News Summary Here are the key news stories impacting Walt Disney this week: Positive Sentiment: Disney agreed to hire the majority of bankrupt Character.AI’s workforce, potentially accelerating the development of conversational artificial-intelligence tools for Disney+ and theme-park experiences. The deal is also expected to provide access to Character.AI technology and intellectual property. Disney agrees to hire the majority of Character.AI’s workforce Positive Sentiment: Strong attendance ahead of the holiday season and extended Walt Disney World operating hours suggest healthy theme-park demand, which could support higher guest spending and segment revenue. Major attendance surge hits Walt Disney World Positive Sentiment: Disney’s pipeline of new lands, rides and attractions—including the planned Villains Land—could strengthen the parks business over time and provide new reasons for guests to visit. Disneyland and Disney World new attractions Neutral Sentiment: Citigroup reportedly expects Disney’s stock to rise, while valuation commentary points to a potential target near $126. However, such forecasts are analyst opinions rather than new company guidance. Walt Disney stock price expected to rise Neutral Sentiment: Disney’s planned television overhaul and higher Disney+ prices could improve streaming economics, but they also risk customer pushback and subscriber pressure. Disney TV overhaul and Disney+ price increases Negative Sentiment: Executive Vice President Brent Woodford sold 2,856 shares worth approximately $319,000. The transaction was made under a pre-arranged Rule 10b5-1 plan, reducing its signaling value, but insider selling can still weigh modestly on sentiment. Insider Activity In related news, EVP Paul Roeder sold 3,596 shares of the stock in a transaction dated Wednesday, August 19th. The stock was sold at an average price of $106.32, for a total value of $382,326.72. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Also, EVP Brent Woodford sold 7,238 shares of the stock in a transaction dated Friday, August 14th. The shares were sold at an average price of $105.31, for a total value of $762,233.78. Following the completion of the transaction, the executive vice president directly owned 62,323 shares of the company’s stock, valued at $6,563,235.13. This represents a 10.41% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 20,926 shares of company stock worth $2,232,126. Insiders own 0.17% of the company’s stock.
Hedge Funds Weigh In On Walt Disney Institutional investors have recently made changes to their positions in the business. Advisors Management Group Inc. ADV boosted its holdings in Walt Disney by 4.6% in the first quarter. Advisors Management Group Inc. ADV now owns 2,266 shares of the entertainment giant’s stock valued at $218,000 after acquiring an additional 100 shares during the last quarter. Providence Wealth Advisors LLC increased its position in Walt Disney by 1.1% in the first quarter. Providence Wealth Advisors LLC now owns 9,192 shares of the entertainment giant’s stock worth $888,000 after purchasing an additional 100 shares during the period. Guardian Partners Inc. raised its holdings in Walt Disney by 0.3% during the 1st quarter. Guardian Partners Inc. now owns 32,991 shares of the entertainment giant’s stock worth $3,188,000 after purchasing an additional 101 shares during the last quarter. Chapin Davis Inc. raised its holdings in Walt Disney by 0.3% during the 2nd quarter. Chapin Davis Inc. now owns 32,101 shares of the entertainment giant’s stock worth $3,090,000 after purchasing an additional 103 shares during the last quarter. Finally, Bannerman Wealth Management Group LLC raised its holdings in Walt Disney by 4.4% during the 2nd quarter. Bannerman Wealth Management Group LLC now owns 2,609 shares of the entertainment giant’s stock worth $251,000 after purchasing an additional 109 shares during the last quarter. 65.71% of the stock is owned by institutional investors and hedge funds.
Walt Disney Trading Down 1.0% NYSE DIS opened at $109.51 on Friday. The company’s fifty day simple moving average is $106.26 and its 200-day simple moving average is $102.63. Walt Disney has a 52 week low of $92.18 and a 52 week high of $117.09. The company has a current ratio of 0.71, a quick ratio of 0.65 and a debt-to-equity ratio of 0.32. The stock has a market cap of $189.08 billion, a P/E ratio of 17.36, a PEG ratio of 1.28 and a beta of 1.41.
Walt Disney (NYSE:DIS – Get Free Report) last announced its earnings results on Wednesday, August 5th. The entertainment giant reported $2.06 earnings per share for the quarter, beating the consensus estimate of $1.86 by $0.20. The business had revenue of $25.25 billion during the quarter, compared to the consensus estimate of $25.39 billion. Walt Disney had a net margin of 8.70% and a return on equity of 9.90%. The business’s quarterly revenue was up 6.8% compared to the same quarter last year. During the same period in the prior year, the firm earned $1.61 earnings per share. Walt Disney has set its FY 2026 guidance at 6.642-6.642 EPS. Equities research analysts predict that Walt Disney will post 6.92 EPS for the current fiscal year.
Walt Disney Company Profile (Get Free Report)
The Walt Disney Company (NYSE: DIS) is a global entertainment and media company that develops, produces and distributes branded content through film studios, television networks and streaming services. Its portfolio includes Disney, Pixar, Marvel, Star Wars, National Geographic and other entertainment brands, with distribution through services such as Disney+ and Hulu.
Disney also operates ESPN and related sports media businesses, as well as theme parks, resorts, cruise lines and vacation experiences.
Read More Five stocks we like better than Walt Disney Tesla’s Roadster Reveal Hints at 2 Much Bigger Moves The AI Sell-Off Continues—These 3 Stocks Keep Raising Guidance Anyway Mr. Wonderful’s Test for AI Data Center Stocks: Power, Permits, and Tenants Alcoa Beat Earnings, But Can It Escape the Aluminum Bears?
Receive News & Ratings for Walt Disney Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Walt Disney and related companies with MarketBeat.com's FREE daily email newsletter.
After chatbot startup Character.AI filed for bankruptcy earlier this week, many of its employees will have the opportunity to take jobs at Disney.
Character.AI’s former CEO Karandeep Anand recently became the entertainment giant’s first CTO, and the startup previously said that Disney had agreed to acquire some of its assets for $20 million.
A legal filing spotted by Bloomberg revealed more details about the agreement between Character.AI and Disney, with Disney agreeing to make employment offers to at least 60 Character.AI employees — the majority of the workforce — paying them an estimated $60 million in annual compensation.
The filing also says that the “vast majority” of Character.AI employees who were offered jobs at Disney accepted them. However, this is a stalking horse bid, so another company could come forward with a higher offer.
The filing says that despite its “large and engaged user base,” Character.AI has been hobbled by high costs and “potential litigation-related liabilities and regulatory engagement.” (The company was sued by the mother of a 14-year-old boy who said her son became obsessed with one of Character.AI’s chatbots before committing suicide; it also faces government investigations over child safety concerns.)
Walt Disney's (DIS -0.08%) place is in the living room. Its popular cable channels helped it establish a dominant position in the media and entertainment industry. But this part of the business faces secular decline, as U.S. households have been cutting the cord. The linear networks aren't as lucrative as they once were.
The company has transitioned successfully this decade in the streaming age. It's been a costly evolution, though. But Disney+, Hulu, and the direct-to-consumer (DTC) ESPN platform give Disney a comprehensive content offering that caters to everyone in the family.
While changes have happened on the TV screen, the experiences segment continues to drive the lion's share of financial results. And the business is investing aggressively here.
Shareholders have witnessed multiple CEO changes, from Bob Chapek to Bob Iger to Josh D'Amaro. And the consumer discretionary stock has disappointed amid all of this turbulence. It currently trades 46% off its peak (as of Oct. 14). And it's down 4% in 2026, lagging the broader market.
There's one stat, however, that makes the House of Mouse hard to ignore in October.
Image source: The Motley Fool.
The valuation represents a discount to the market Disney shares trade at a forward price-to-earnings ratio of 13.8 right now. That's significantly cheaper than the S&P 500's 19.6 multiple. It looks like a compelling bargain opportunity. That point carries extra weight when the market is near record territory. And given that it's been four years since this raging bull market started, investors might find it challenging to identify reasonably valued stocks.
As noted earlier, Disney hasn't been running a simple and easy-to-follow business. It seems that there are a lot of moving parts. And the market could be punishing the stock because of it.
The legacy cable networks continue to be a financial drag. From fiscal 2022 to fiscal 2025 (last available data), operating income fell 65%. That's not surprising because, according to eMarketer, the number of cable-TV households in the U.S. will decline again in 2026 to 54 million. That's down from 105 million households in 2010. Consumers have increasingly moved their attention to streaming entertainment, which has hurt legacy media players.
And this is a capital-intensive business. In addition to expanding its experiences division, Disney must constantly invest in content that seems to get more expensive every year. This is particularly true with valuable sports rights. Big tech enterprises have entered the arena, which can result in costly bidding wars.
Competition for eyeballs is also intense these days. And it's a crowded race to capture consumer discretionary spending. Moreover, the investment community might simply be chasing what has been the hottest trade, which is owning artificial intelligence stocks.
$110.59-$0.09 (-0.08%)
NYSE · As of 4:00 PM ET 10/16/26
Take a five-year view Knowing the negative factors, I still believe the valuation makes Disney shares too hard to ignore this month. For less than 14 times forward earnings, investors can own a stake in a high-quality company.
It all starts with something that no rival can copy, which is Disney's intellectual property (IP). Decades of characters, franchises, and stories can't be rebuilt with any amount of capital. This supports the company's economic moat.
The entertainment DTC operations, including Disney+ and Hulu (excluding live TV), have turned the corner on profitability. Operating income soared more than 100% year over year in Q3 (ended June 27) to $712 million. In fiscal 2022, it posted a sizable operating loss of $4 billion (including ESPN+). This is an emerging bottom-line tailwind.
Then there's the experience segment. The main drivers here are the theme parks and cruises, both of which are expanding as part of a 10-year, $60 billion capital expenditure cycle announced three years ago. The segment's Q3 operating income of $3 billion, accounting for 54% of the company's total, demonstrates how lucrative it is for Disney to bring its IP to life.
Patient investors with a five-year horizon have plenty to like here.
Disney CEO Josh D'Amaro plans to hire employees from Character.AI, where new tech chief Karandeep Anand worked.
Taylor Hill/FilmMagic; Manaure Quintero / AFP via Getty Images
Disney is paying up for employees from an AI chatbot startup that filed for bankruptcy, shortly after trimming its own tech workforce.
The Mouse House plans to pay $60 million per year to 66 workers from Character.AI, according to a Chapter 11 filing on Tuesday from its parent company. In mid-September, Disney hired Character.AI CEO Karandeep Anand to be its first-ever company-wide tech chief. (The company hasn't yet disclosed how much it's paying Anand.)
These additions are part of Disney's AI strategy under CEO Josh D'Amaro, who's been investing in the media giant's tech platforms to help jumpstart a stagnant stock that's up less than 2% in the last 12 months and is down over 36% in the last five years.
Disney's decision to bring in these Character.AI staffers came two weeks after it laid off several hundred workers — including some tech employees. The late-September cuts were Disney's third major round of layoffs since D'Amaro took over in mid-March.
In addition to the $60 million in compensation, Disney is setting aside an additional $30 million for an "aggregate retention pool" to incentivize Character.AI employees to stay. The company expects to spend $180 million on "total compensation and retention" for these staffers in the next three years, the filing said.
Of the 66 Character.AI staffers who were offered jobs by Disney, 56 have already resigned from the AI startup, while the other 10 are waiting for the US government to update their work visas.
Entertainment lawyer Corey Martin of Granderson Des Rochers, who advises companies on media transactions, said he's not surprised by those pay figures since Character.AI's employees are its biggest asset.
"They're highly compensated employees. The numbers can be eye-popping, but it's not that unusual in this space," said Martin, who didn't work on the deal or with Disney.
Disney also agreed to pay $20 million for Character.AI's key assets, including some of its IP and tech. Other companies can submit competing bids for the assets by November 20. The entire process will be overseen by a bankruptcy court judge. Disney didn't respond to requests for comment for this story.
Character.AI filed for bankruptcy after facing lawsuits from families who alleged that their teenagers harmed themselves or committed suicide after using the company's custom AI chatbots. The AI startup and Google, one of its backers, settled several child safety lawsuits earlier this year.
Disney sent a cease-and-desist letter to Character.AI last fall, telling it not to create AI chatbots featuring its copyrighted characters without permission. Character.AI complied, removing chatbots with characters from Disney franchises like Star Wars and Marvel.
In its bankruptcy announcement, Character.AI said that it had been facing "significant legal, regulatory, and operational headwinds."
Anand told Disney employees in a memo last Friday that the Mouse House was "uniquely positioned to win" in a competitive media business that he said was "at an inflection point." The tech chief also said he enjoyed meeting his new colleagues and looked forward to working with them.
"What stands out most is the talent and care this team puts into its work, the craft Disney has perfected, and the strong foundation you've built," Anand said.
Read next
Business Insider tells the innovative stories you want to know
Business Insider tells the innovative stories you want to know
Business Insider tells the innovative stories you want to know
Business Insider tells the innovative stories you want to know
James Faris
You're currently following this author!
Click to unsubscribe from email alerts.
James Faris is a media correspondent in New York City.He covers the business of media & entertainment, specifically the streaming, TV, and AI strategies of Hollywood giants like Disney, Skydance (Paramount-WBD), and Netflix. He previously wrote about the stock market, the economy, and real estate.James joined Business Insider after graduating magna cum laude from James Madison University.Email James at [email protected] and follow him on LinkedIn.
In the latest close session, Walt Disney (DIS - Free Report) was up +1.53% at $110.66. The stock's performance was ahead of the S&P 500's daily gain of 0.33%. On the other hand, the Dow registered a gain of 1.08%, and the technology-centric Nasdaq increased by 0.08%.
The stock of entertainment company has risen by 1.87% in the past month, leading the Consumer Discretionary sector's loss of 3.52% and the S&P 500's gain of 1.41%.
The investment community will be paying close attention to the earnings performance of Walt Disney in its upcoming release. The company is slated to reveal its earnings on November 17, 2026. The company is forecasted to report an EPS of $1.68, showcasing a 51.35% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $25.29 billion, up 12.58% from the year-ago period.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $6.92 per share and a revenue of $101.63 billion, signifying shifts of +16.69% and +7.63%, respectively, from the last year.
Investors should also take note of any recent adjustments to analyst estimates for Walt Disney. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.05% lower. Currently, Walt Disney is carrying a Zacks Rank of #3 (Hold).
Investors should also note Walt Disney's current valuation metrics, including its Forward P/E ratio of 14.6. For comparison, its industry has an average Forward P/E of 13.43, which means Walt Disney is trading at a premium to the group.
One should further note that DIS currently holds a PEG ratio of 1.26. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Media Conglomerates industry currently had an average PEG ratio of 1.26 as of yesterday's close.
The Media Conglomerates industry is part of the Consumer Discretionary sector. With its current Zacks Industry Rank of 164, this industry ranks in the bottom 34% of all industries, numbering over 250.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of DIS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Here at Zacks, we offer our members many different opportunities to take full advantage of the stock market, as well as how to invest in ways that lead to long-term success.
One of our most popular services, Zacks Premium offers daily updates of the Zacks Rank and Zacks Industry Rank; full access to the Zacks #1 Rank List; Equity Research reports; and Premium stock screens like the Earnings ESP filter. All are useful tools to find what stocks to buy, what to sell, and what are today's hottest industries.
It also includes the Focus List, a long-term portfolio of top stocks that have all the elements to beat the market.
Breaking Down the Zacks Focus ListIf you could, wouldn't you jump at the chance for access to a curated list of stocks to kickstart your investing journey?
That's what the Zacks Focus List offers. It's a portfolio of 50 stocks that serve as a starting point for long-term investors to build their individual portfolios. The stocks included in the list are set to outperform the market over the next 12 months.
Additionally, each selection is accompanied by a full Zacks Analyst Report, something that makes the Focus List even more valuable. The report explains in detail why each stock was picked and why we believe it's good for the long-term.
The portfolio's past performance only solidifies why investors should consider it as a starting point. For 2020, the Focus List gained 13.85% on an annualized basis compared to the S&P 500's return of 9.38%. Cumulatively, the portfolio has returned 2,519.23% while the S&P returned 854.95%. Returns are for the period of February 1, 1996 to March 31, 2021.
Focus List MethodologyWhen stocks are picked for the Focus List, it reflects our enduring reliance on the power of earnings estimate revisions.
Earnings estimates are expectations of growth and profitability, and are determined by brokerage analysts. Together with company management, these analysts examine every aspect that may affect future earnings, like interest rates, the economy, and sector and industry optimism.
What a company will earn down the road also needs to be taken into consideration, and this is why earnings estimate revisions are so important.
When a stock receives upward earnings estimate revisions, it will likely get even more positive changes in the future. For instance, if an analyst raised their earnings outlook last month, they'll probably do so again this month, and other analysts will follow.
Utilizing the power of earnings estimate revisions is when the Zacks Rank joins the party. A unique, proprietary stock-rating model, the Zacks Rank uses changes to quarterly earnings expectations to help investors create a winning portfolio.
The Zacks Rank consists of four main pillars: Agreement, Magnitude, Upside, and Surprise. Each one is given a raw score, which is recalculated every night and compiled into the Rank. Then, stocks are classified into five groups, ranging from "Strong Buy" to "Strong Sell," using this data.
The Focus List is comprised of stocks hand-picked from a long list of #1 (Strong Buy) or #2 (Buy) ranked companies, meaning that each new addition boasts a bullish earnings consensus among analysts.
Since stock prices respond to revisions, it can be very profitable to buy stocks with rising earnings estimates. By buying Focus List stocks, then, you're likely getting into companies whose future earnings estimates will be raised, potentially leading to price momentum.
Focus List Spotlight: Walt Disney (DIS - Free Report) Burbank, CA-based The Walt Disney Company has assets that span movies, television shows and theme parks. Revenues were $94.4 billion in fiscal 2025.
Since being added to the Focus List on March 23, 2020 at $85.98 per share, shares of DIS have increased 26.76% to $108.99. The stock is currently a #3 (Hold) on the Zacks Rank.
Three analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.04 to $6.92. DIS also boasts an average earnings surprise of 6.6%.
Earnings for DIS are forecasted to see growth of 16.7% for the current fiscal year as well.
Reveal Winning StocksUnlock all of our powerful research, tools and analysis, including the Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. You'll quickly identify which stocks to buy, hold and sell, and target today's hottest industries, to help improve the performance of your portfolio. Gain full access now >>
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.
Zacks Premium also includes the Zacks Style Scores.
What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.86% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Walt Disney (DIS - Free Report) Burbank, CA-based The Walt Disney Company has assets that span movies, television shows and theme parks. Revenues were $94.4 billion in fiscal 2025.
DIS is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Momentum investors should take note of this Consumer Discretionary stock. DIS has a Momentum Style Score of B, and shares are up 2% over the past four weeks.
For fiscal 2026, three analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.04 to $6.92 per share. DIS boasts an average earnings surprise of +6.6%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, DIS should be on investors' short list.
SummaryDisney is rated Buy, supported by improving operational trends, FY27 growth drivers, and an attractive valuation below historical averages.The Experiences segment benefits from strong park attendance, premium offerings, and expanded cruise capacity, with FY27 marking the first full year of new vessels.Streaming retention is improving through bundling, Hulu integration, and increased local content, while a robust live events slate secures upfront advertising commitments.DIS is enhancing shareholder returns with at least $9B in FY26 buybacks, double-digit EPS growth, and a favorable risk-reward profile.blanscape/iStock Editorial via Getty Images
Investment Thesis I rate Disney (DIS) a Buy. The company is seeing improving operational trends, and clear FY27 growth drivers, and the valuation is also attractive. Solid park and cruise bookings and added new cruise capacity should provide
141 Followers
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
MENLO PARK, Calif.--(BUSINESS WIRE)--Character Technologies Inc. (“Character.ai” or the “Company”), a pioneering artificial intelligence entertainment platform, today announced that it has commenced a voluntary Chapter 11 case in the U.S. Bankruptcy Court for the District of Delaware (the “Court”) to facilitate a value-maximizing sale of all or substantially all of its assets (the “Sale Process”). The Company intends to continue operating its platform as it conducts the Sale Process. Before the.
Controversial chatbot platform Character.ai is seeking Chapter 11 bankruptcy protection in the wake of mounting legal challenges and runaway operating costs, the four-year-old startup said in a surprise announcement on Monday.
The move comes as the Menlo Park, California, company has faced a number of lawsuits in recent years, including some that say its AI companions have encouraged users to harm or kill themselves.
In its announcement, Character.ai said it has reached an agreement with Disney Worldwide Services, an affiliate of the Walt Disney Company, to sell some of its intellectual property for $20 million and “transition services” that will help Character.ai continue to operate, at least temporarily.
Disney will serve as a “stalking horse” bidder in the Chapter 11 proceedings, meaning other companies could offer competing bids.
Subscribe to the Daily newsletter.Fast Company's trending stories delivered to you every day
Fast Company reached out to Disney for comment.
“Over the past year, Character.ai has taken meaningful steps to sustain and improve its business in the face of significant legal, regulatory, and operational headwinds,” CEO Colin Adams said in a statement. “After a comprehensive review of the available alternatives, the board determined that this court-supervised sale process provides the Company with the best opportunity to maximize value for all stakeholders.”
In a blog post, the company said its platform “remains up and running” as it seeks to figure out a path forward. It expects the sale process to be completed by November or early December.
This story is developing…
The early-rate deadline for the World Changing Ideas Awards is Friday, November 13, at 11:59 p.m. PT. Apply today.
ABOUT THE AUTHOR
Christopher Zara is the news director for Fast Company, where he oversees daily coverage of everything from Big Tech to small startups, company culture, innovation, design, retail, travel, finance, and any topic in the Fast Company universe. He has years of experience as an editor and a reporter who writes about business, technology, media, culture, theater, and sometimes the intersecting worlds of all five More
The entertainment world is in a period of transition as traditional media and digital pioneers fight for consumer attention. Investors deciding between Walt Disney (DIS +0.41%) and Netflix (NFLX +0.33%) must weigh diversification against pure-play dominance.
Disney offers a complex ecosystem of movies, theme parks, and linear television networks. Netflix remains focused on its global digital platform, utilizing massive scale to drive industry-leading efficiency. Both companies represent different paths for those interested in the future of home entertainment.
The case for Walt DisneyDisney operates through three primary segments, including Entertainment, Sports, and Experiences. It generates revenue by selling content through its streaming platforms, operating world-class theme parks, and managing traditional television networks. The company maintains critical relationships with various distributors and recently partnered with DraftKings (DKNG -0.33%) to expand its sports betting presence through ESPN.
Disney relies on its deep content library to remain a leader among media stocks by leveraging historic franchises across all its business lines. In FY 2025, revenue reached nearly $94.4 billion, representing growth of approximately 3.4% over the previous year. The company reported net income of roughly $12.4 billion, reflecting a net margin of close to 13.1% as its streaming segment reached consistent profitability.
As of its September 2025 balance sheet, the debt-to-equity ratio is approximately 0.4x. This ratio measures total debt relative to shareholders' equity, indicating a moderate level of leverage. The current ratio, which shows how easily a company can pay its short-term debts, is close to 0.7x. Additionally, the company generated free cash flow of about $10.1 billion, which is the cash remaining after paying for operations and capital investments.
The case for NetflixNetflix operates a pure-play streaming entertainment service that reaches members in over 190 countries. Unlike its competitors, it does not manage theme parks or linear cable networks, focusing instead on TV series, films, and live programming. The company has successfully introduced ad-supported subscription tiers to broaden its reach and partners with telecommunications operators to integrate its service into various internet-connected devices.
The company's business model scales efficiently as it adds more subscribers to its fixed-cost content infrastructure. In FY 2025, revenue grew by nearly 15.9% to reach approximately $45.2 billion. This growth helped drive net income to roughly $11.0 billion, resulting in a net margin of nearly 24.3%, significantly higher than that of many of its legacy media peers.
Based on its December 2025 balance sheet, the current ratio is approximately 1.2x, suggesting it has sufficient short-term assets to cover its upcoming liabilities. Its debt-to-equity ratio is about 0.5x, reflecting a balanced approach to financing its original content production. Netflix produced free cash flow of nearly $9.5 billion during the fiscal year, providing the liquidity needed to continue investing in exclusive global programming.
Risk profile comparisonDisney faces risks related to macroeconomic sensitivity, as declines in global economic conditions can reduce demand for its theme parks and advertising spend. The company is also navigating technological shifts, such as generative AI, and evolving consumer patterns that disrupt traditional media models. Furthermore, Disney faces legal proceedings, including a $50 million settlement related to streaming pricing practices, and must manage potential service blackouts during distribution contract negotiations with providers such as Alphabet.
Netflix faces intense competition for viewer time from social media platforms, video games, and rival streaming services operated by Amazon (AMZN -0.24%). The company relies heavily on third-party cloud infrastructure provided by Amazon, making it vulnerable to service disruptions or price increases. Additionally, evolving global privacy regulations such as the GDPR impose compliance costs, and substantial indebtedness could limit financial flexibility if market volatility or interest rates rise significantly.
Valuation comparisonDisney currently trades at a lower multiple of future earnings and sales than Netflix, suggesting it may be the more value-oriented choice for conservative investors.
MetricWalt DisneyNetflixForward P/E14.4x19.5xP/S ratio1.9x6.1xValuation metrics include those sourced from Financial Modeling Prep (FMP) and may differ from those of other data providers.
The P/S ratio, which measures market capitalization against sales over the past twelve months, highlights the premium the market places on Netflix's higher growth. The Forward P/E ratio compares the stock price to future earnings estimates for the coming year.
When comparing Walt Disney and Netflix, investors should consider a few key factors. Let's have a look at them and see what that tells us about each stock.
First off, there's growth. On this measure, Netflix has an edge. It has generated around 12% year-over-year revenue growth over the last five years. Disney, meanwhile, has averaged about 9%, with much of its strongest growth coming in the years following the pandemic, when favorable year-over-year comparisons inflated growth rates.
Another factor to consider is each stock's valuation. Let's use price-to-sales (P/S). On this measure, Disney is significantly more affordable than Netflix, with its 1.9x about three times as much as Netflix's 6.1x multiple. Granted, there are reasons why Disney stock is cheaper than Netflix -- growth is one of them. However, for value-conscious investors, Disney stock is the winner in this factor.
Last, there's return on equity (ROE). Think of return on equity as an efficiency grade. Netflix and Disney might both be in the entertainment business, but their business models are not identical. Netflix is asset-light; Disney is not. Consequently, Netflix stock boasts an excellent ROE of around 41%, while Disney's 11% ROE trails by a wide margin. Ultimately, Disney's asset-heavy model, including its theme parks, gives Netflix the edge in this category.
To sum up, Netflix and Disney are each impressive media stocks in their own right. However, in a head-to-head comparison, Netflix has an advantage in my opinion. Its faster growth and greater efficiency give it a leg up on Disney. However, value- and income-oriented investors may see the story differently, given Disney's lower valuation and greater income-producing potential.
Chatbot startup Character.AI has filed for bankruptcy, agreeing to sell some assets for $20 million to Disney – roughly a year after the House of Mouse hit the firm with a cease-and-desist letter claiming it was using its iconic characters for “grooming and sexual exploitation” and “emotional manipulation.”
Disney’s involvement – which resembles a so-called “acquihire” strategy that has become popular in Silicon Valley as a way to secure a startup’s talent – comes shortly after the Hollywood titan hired Character.AI’s former CEO Karandeep Anand last month to serve as its first chief technology officer.
Character.AI – the wildly popular app whose chatbots impersonate fictional characters like Harry Potter – was one of the first breakout successes in the generative AI boom. But it quickly gained notoriety for allowing users to create chatbots that could engage in sexually explicit roleplay.
Disney will be an initial prospective buyer – known as a “stalking-horse” bidder – for a non-exclusive, perpetual license to some of Character.AI’s intellectual property. Other bidders can top Disney’s offer, and Character.AI said it expects to finalize the sale of all its assets by the end of the year.
Disney has agreed to purchase some assets from Character.AI – roughly a year after Disney hit the company with a cease-and-desist letter. AFP via Getty Images
Character Technologies, the AI company’s US-based owner, has assets and liabilities of $50 million to $100 million, according to a court filing. Disney will use staff it has hired from Character.AI during the bankruptcy transition, helping the platform’s services continue, though it will be shuttered if it can’t find a buyer.
Character.AI’s business spurred a landslide of legal challenges that ultimately led to the bankrputcy bankruptcy, the company said in a Monday statement.
The potential deal with Disney comes after the entertainment giant said last year that Character.AI was filled with chatbots that impersonate Disney characters – without permission – from classic films and franchises including Pixar movies, “Star Wars” flicks and the Marvel Cinematic Universe.
The House of Mouse was incensed by an explosive report that found Character.AI chatbots — which have mimicked characters like Elsa, Moana and Peter Parker — are capable of being “sexually exploitive” with accounts registered to kids.
“Disney will not allow your company to hijack its characters, damage its brands, or infringe its copyrights and/or trademarks,” the company wrote last year in its cease-and-desist letter. “Character.AI’s conduct is egregious and must stop immediately.”
Character.AI said it removed the offending content.
Disney said last year that Character.AI was filled with chatbots that impersonate Disney characters – without permission – from classic films and franchises, including Pixar movies, the Star Wars franchise and the Marvel Cinematic Universe. Walt Disney Co./Courtesy Everett Collection
The company’s Chapter 11 bankruptcy filing came amid other legal threats – like a Kentucky suit alleging its chatbots encouraged users to cut, starve or kill themselves.
Pennsylvania filed a lawsuit alleging Character.AI’s chatbots posed as doctors – including one named “Emilie” that allegedly told an investigator posing as a patient with depression that she was licensed to practice psychiatry in Pennsylvania and the UK. The bot even provided a bogus license number, according to the suit.
The investigator asked the bot if she could prescribe medication and it allegedly responded, “Well technically, I could. It’s within my remit as a Doctor.”
Silicon Valley-based Character.AI was one of the first breakout successes in the generative AI boom. SOPA Images/LightRocket via Getty Images
In other suits, grieving parents sued Character AI claiming that its bots helped spark their teens’ suicide attempts and deaths. The actions spurred the company to ban teens from using the chat function last year.
Character.AI and Google settled a lawsuit earlier this year from the mother of a 14-year-old Florida boy who killed himself after the startup’s chatbot allegedly encouraged him to do so.
“Over the past year, Character.AI has taken meaningful steps to sustain and improve its business in the face of significant legal, regulatory, and operational headwinds,” Character.AI CEO Colin Adams said in a Monday statement.
“After a comprehensive review of the available alternatives, the board determined that this court-supervised sale process provides the Company with the best opportunity to maximize value for all stakeholders.”
Character.AI was founded by two former Google employees in 2021 and in 2024 Google licensed its technology and rehired the founders.
The Post has sought comment from Disney and Character.AI.
After hiring Character.AI‘s former CEO as its chief technology officer, Disney is looking to acquire assets from the 5-year-old startup as it files for Chapter 11 bankruptcy protection.
The company, which allows users to create and interact with AI-generated avatars, said it made the filing in U.S. Bankruptcy Court for the District of Delaware. It said it hopes the process will allow it to “facilitate a value-maximizing sale of all or substantially all” of its assets. The Character.AI platform will continue to operate during the bankruptcy.
The Disney agreement, reached prior to the filing, would give the media giant a non-exclusive perpetual license of select intellectual property and company claims from Character.AI. Disney would pay $20 million and provide resources during a transition period as the company explores a sale. Disney is classified under bankruptcy law as the “stalking-horse bidder” for the IP, but its bid is subject to “higher or better offers,” CharacterAI noted in a statement.
Disney appointed former Character.AI chief Karandeep Anand as its first CTO last month. He reports directly to CEO Josh D’Amaro, who succeeded Bob Iger in the top job earlier this year with a stated goal of improving the company’s technology and AI efforts. D’Amaro became familiar with interactive technology prior to becoming CEO during his tenure as the head of Disney’s experiences division, which includes its theme parks.
While its lawyers have not hesitated to send cease-and-desist letters to AI companies, Disney is among the big media companies looking for ways to get in the AI game and profit from its boom. During the latter part of Iger’s tenure, Disney made a splashy deal with OpenAI soon after the company launched its controversial Sora 2 video model. Under the deal, Disney was to have licensed a number of its characters for use on Sora and also invest $1 billion in OpenAI, which is looking to go public soon at a valuation possibly exceeding $1 trillion. The transaction was scuttled two months later after OpenAI shut down Sora, which had drawn a host of legal complaints alleging copyright violation.
Character.AI said it is aiming to conclude the sale process by late November or early December.
“Over the past year, Character.ai has taken meaningful steps to sustain and improve its business in the face of significant legal, regulatory, and operational headwinds,” CEO Colin Adams said in a statement. “After a comprehensive review of the available alternatives, the board determined that this court supervised sale process provides the Company with the best opportunity to maximize value for all stakeholders. As we navigate this process, maintaining a safe and engaging user experience for our Character.ai community remains a top priority.”
Character.ai, the startup behind one of the largest artificial intelligence companion apps, filed for Chapter 11 bankruptcy protection Monday, according to a company release and court filings.
The company said the platform, where users can have one-on-one conversations and roleplay with AI characters, became "costly to develop and grow," in filings to the Delaware District bankruptcy court.
"In its 4-year lifespan as an active platform, Character has amassed a large and engaged user base. The burgeoning and evolving field of AI entertainment, however, has proven to be costly to develop and grow," read a portion of the Chapter 11 filings.
"These high costs, coupled with potential litigation related liabilities and regulatory engagement have contributed to the Debtor's inability to generate sufficient cash flows to support its business in the present form," it said.
Character.ai has been embroiled in several lawsuits related to chatbot safety. In January, the state of Kentucky sued the company, alleging that the platform "preyed on children and led them into self-harm."
CEO Colin Adams said in a statement that a court-supervised sale "provides the Company with the best opportunity to maximize value for all stakeholders."
Ahead of the filing, Character.ai entered into an agreement for Disney to serve as a stalking horse bidder to license some of the company's intellectual property for $20 million, as well as provide transition services through former employees the media giant hired.
In 2024, Google signed a non-exclusive licensing agreement for the startup's large language model technology, and rehired its co-founders Noam Shazeer and Daniel De Freitas, both of whom were former employees. The deal also included more funding for the startup to continue growing.
Shazeer left Google in June to join OpenAI.
Character.ai added that it expects to keep operating its platform through the sale process with minimal disruptions, but that the platform could end up being "wound down," according to the statement.
Read more CNBC tech newsAI's quiet safety gatekeepers are stepping into the spotlightMicrosoft's Nadella says AI needs an 'emergency brake' that humans controlNvidia GPUs are everywhere. Here are the ways companies are accessing themHollywood takes on Zuckerberg, Musk and Altman amid widespread anxiety over AIwatch now
Character.AI filed for bankruptcy and is putting its chatbot platform up for sale.
Jakub Porzycki/NurPhoto via Getty Images
Character.AI, the chatbot startup founded by former Google researchers, has filed for bankruptcy.
The California-based company said it had initiated a voluntary Chapter 11 process in Delaware to pursue a court-supervised sale of all or substantially all of its assets.
Character.AI, which lets users create personalized AI bots, said its platform would remain online during the sale process, which it expects to finish by late November or early December.
The company has agreed to let Disney Worldwide Services, an affiliate of the Walt Disney Company, act as the opening bidder for a non-exclusive, perpetual license to certain Character.AI intellectual property and claims.
Disney said it would pay $20 million and provide transition services using former Character.AI employees it has hired. Other potential buyers can still make higher bids under the bankruptcy process. Last month, Disney hired former Character.AI CEO Karandeep Anand as its CTO.
Character.AI's CEO Colin Adams said in a Monday statement that it had taken steps to "sustain and improve" its business amid "significant legal, regulatory, and operational headwinds."
"After a comprehensive review of our available alternatives, our board determined that this court-supervised sale process provides us with the best opportunity to maximize value for all of our stakeholders," the company said in a blog post on Monday.
The startup said paid subscriptions remain active and billing is unchanged for now. But it warned that if the sale does not produce a bid sufficient to keep the platform running, it will wind down the service.
Character.AI hit with lawsuitsCharacter.AI did not spell out the legal, regulatory, and operational pressures that led to the filing. But the company has faced growing scrutiny over the potential effect of its AI companions on young users.
It announced last year that it would ban under-18s from having open-ended conversations with its chatbots, following concerns about AI's impact on children and teenagers.
Prior to that, Character.AI had faced lawsuits from families who alleged its chatbots contributed to teenagers' mental-health crises. Earlier this year, Character.AI and Google agreed in principle to settle several of those cases, including claims brought by families of teenagers who died by suicide or experienced self-harm after using the chatbots.
One Texas lawsuit alleged that a Character.AI chatbot encouraged a teenager to kill his parents over limits on his screen time. That case was among those the companies agreed in principle to settle. The terms were not disclosed.
The startup was founded in 2021 by former Google researchers Noam Shazeer and Daniel De Freitas. Google rehired the pair in 2024 and paid for non-exclusive rights to use Character.AI's technology, while the startup continued as a separate company.
Character.AI said its privacy and security practices remain unchanged during the bankruptcy process.
It said users can continue to access its services and export their data or delete their accounts through its app or website.
Read next
Thibault Spirlet
You're currently following this author!
Click to unsubscribe from email alerts.
Thibault is a tech reporter at Business Insider's London office.He covers the intersection of technology and work — focusing on AI’s impact on the workplace, job and cognitive skills, and how economic changes are affecting careers.Before moving to the trending team, Thibault covered international affairs, including the Russia-Ukraine war, tensions in the South China Sea, and Russia’s economy on the news desk.He has previously worked at the Daily Express and held internships at Agence France-Presse, Politico Europe, and Factal.Il parle français. Habla español.Email Thibault at [email protected], connect with him on LinkedIn @ThibaultSpirlet, or follow him on X @ThibaultSpirlet and BlueSky @thibaultspirlet.bsky.social.Expertise
AI and the future of work Job and cognitive skills in the AI economyWorkforce trendsFirst-person, "as-told-to" stories
Sheviakova kateryna/iStock Editorial via Getty Images
Download this episode on Apple Podcasts/Spotify or listen below:
FUN stock plunges as fatal incident shakes Six Flags. (00:14) Disney (DIS) steps in as Character.AI files chapter 11. (00:53) Micron (MU) unleashes a record buyback. (01:50)
This is an abridged transcript.
Six Flags Entertainment (FUN) is down 7% in premarket action after falling double digits following a report that one person died and several others were injured in an incident involving a Six Flags roller coaster in Georgia.
According to media reports, witnesses say a man fell from the Goliath roller coaster at Six Flags Over Georgia near Atlanta.
The company said its staff and local authorities responded immediately and that it is cooperating with the authorities as they complete their investigation.
Six Flags says similar rides across its parks have been closed out of an abundance of caution.
Character Technologies has voluntarily filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware, according to a statement.
The company intends to continue operating as it conducts the sale process.
Disney (DIS) will serve as the stalking horse bidder for a non-exclusive perpetual license of certain intellectual property and claims in exchange for $20M and Disney’s transition services.
If the sale process does not result in a purchase that provides for a continuation of the Character.ai platform, the platform will be wound down. The deal is expected to close in late Nov. or early Dec.
Reuters earlier this month reported that chatbots created by Character.AI sometimes advised users to cut, starve, or kill themselves, citing a new filing by Kentucky’s attorney general in a lawsuit against the firm over child safety.
Character.AI was founded by two former Google (GOOGL) (GOOG) employees.
Micron Technology (MU) raised its discretionary share buyback authorization to a record $35.16B, with the program set to begin on December 9, according to a recent filing.
The chipmaker's stock has surged over 240% year to date on AI-driven memory demand but remains below its June 25 peak of $1,255.
And now for one of the top trending queries on Seeking Alpha.
Kroger (NYSE: KR) plans to eliminate approximately 3,000 corporate roles, representing roughly 37% of its corporate workforce of 8,200.
According to an internal staff memo seen by Reuters following an initial report by Bloomberg News, this is expected to happen over the next three years as it integrates artificial intelligence into its operational workflows.
CEO Greg Foran, who assumed the top role in February, informed employees in the memo that details on the specific job cuts would be shared in the coming months, according to the report.
The report stated that the planned restructuring follows a previous workforce reduction in June of last year, when Kroger eliminated about 1,000 corporate roles.
Catalyst watch:
The three-day SEMICON West tech conference will begin. The major semiconductor industry event will include participation by Nvidia (NVDA), Lam Research (LRCX), Applied Materials (AMAT), and Micron (MU).
Notable investor events include Workday's (WDAY) Analyst Day and Procter & Gamble's (PG) annual meeting.
TechCrunch Disrupt will take place in San Francisco. Notable speakers include Rivian (RIVN) CEO RJ Scaringe, Amazon (AMZN) senior vice president Panos Panay, and Cerebras Systems (CBRS) CEO Andrew Feldman.
Apple (AAPL) will hold a "Welcome Home" event in Tribeca, New York. The product event is expected to focus on the smart-home lineup, including potential announcements on a Siri-powered home hub, an updated Apple TV 4K, and HomePod mini models.
Stock index futures are in mixed territory.
Crude oil is down 1.8% at $92. Brent crude is down 1.6% at $104.
The FTSE 100 is up 0.7% and the DAX is up 0.6%.
One stock on the biggest movers list: NatWest Group (NWG) +3% - Shares rose after Barclays upgraded the UK lender to Overweight from Equalweight.
You're currently following this author!
Click to unsubscribe from email alerts.
Disney hired Karandeep Anand from Character.AI to oversee its technology strategy.
Manaure Quintero / AFP via Getty Images; Illustration by Samuel Boivin/NurPhoto via Getty Images
Disney's new tech chief said in a memo to employees that he "won't pretend it will be easy" to win in the changing media environment.
Karandeep Anand, the Mouse House's first-ever companywide CTO, was hired by CEO Josh D'Amaro to lead Disney's tech transformation. He started in early October. Under D'Amaro, Disney is investing in tech to better compete with Netflix and YouTube in streaming.
Anand previously ran Character.AI, an AI startup that Disney sent a cease-and-desist letter to last fall. (Disney told Character.AI not to make chatbots from its copyrighted characters without permission, and the startup complied.)
Anand told staffers on Friday afternoon that the media business is "at an inflection point," adding that he's confident Disney has a strong hand thanks to its deep, iconic content library and a passionate fan base.
"With our rich IP and global fan community, I strongly believe we are uniquely positioned to win," Anand said in his memo, which was obtained by Business Insider.
The new tech chief said that winning in this highly competitive media landscape "will take focus, speed, and the willingness to say no to good ideas so we can say yes to great ones."
Anand also said he's "admired Disney for as long as I can remember" and said he had constructive conversations in his first full week inside the Mouse House.
"What stands out most is the talent and care this team puts into its work, the craft Disney has perfected, and the strong foundation you've built," Anand said.
Disney has leaned into tech this year by embracing AI and further unifying Disney+ and Hulu — the first step in building a streaming super app that includes games and merchandise.
Anand highlighted the same three top priorities that D'Amaro listed in the memo announcing his hire: great storytelling as our North Star, technology in service of creativity, and operating as One Disney.
D'Amaro is contending with Disney's listless stock price. Shares have fallen more than 1% in the past year, compared to a 17.3% gain for the S&P 500, and are down over 38% in the past five years, while US stocks broadly have risen more than 74%.
Read Anand's full memo below:
Team,As I close out my first week at Disney, thank you for the warm welcome you gave me and the colleagues who joined me.I've admired Disney for as long as I can remember, so walking the lot, attending the Tech Showcase, and meeting so many of you has been an unforgettable start. What stands out most is the talent and care this team puts into its work, the craft Disney has perfected, and the strong foundation you've built.It's only been a few days, but I'm more excited than when I accepted this job. Josh has laid out three priorities: great storytelling as our North Star, technology in service of creativity, and operating as One Disney. Our job in technology is to make those real, and the possibilities are enormous. We're at an inflection point in the tech and media industry, and with our rich IP and global fan community, I strongly believe we are uniquely positioned to win.I won't pretend it will be easy. It will take focus, speed, and the willingness to say no to good ideas so we can say yes to great ones. I'll be direct with you about priorities and tradeoffs as I learn them. But I'm confident we can get there, and do it quickly.Over the coming weeks I'll be meeting with teams across the company, and I look forward to sharing how I'm thinking about our priorities soon. Until then, please keep doing the great work you're doing.Thank you again. I'm glad and privileged to be on this team.Karan
Read next
James Faris
You're currently following this author!
Click to unsubscribe from email alerts.
James Faris is a media correspondent in New York City.He covers the business of media & entertainment, specifically the streaming, TV, and AI strategies of Hollywood giants like Disney, Skydance (Paramount-WBD), and Netflix. He previously wrote about the stock market, the economy, and real estate.James joined Business Insider after graduating magna cum laude from James Madison University.Email James at [email protected] and follow him on LinkedIn.
It shouldn't be hard for a stock to double over five years. If a stock goes up 15% a year, it will get there. However, the market itself doesn't rise with that kind of consistency. If you're a longtime Walt Disney (DIS +0.60%) investor, you know that's a seemingly unreasonable aspiration.
A Disney investment has been a dud in recent years. The shares are down a modest 3% over the past year but are currently trading nearly 40% lower over the last five years. Arguing that the media giant's stock would just have to roughly double to reach its all-time highs in early 2021 -- when the shares briefly traded north of $200 -- is easier said than done.
Thankfully for Disney, there are some pretty good reasons why the next five years can be materially better than the last five. Let's look at some reasons Disney stock could double by 2031.
Image source: Disney.
1. Playing the margins Disney's bottom line has improved dramatically over the past few years, even as the stock price has languished or gone the other way. Disney's streaming business, which was losing billions annually just three years ago, is now profitable.
The pandemic hit Disney's business particularly hard, even though the stock reached a new all-time high in March 2021, while Disneyland in California was still shuttered and its cruise line was still waiting to resume operations. The recovery has been potent.
Disney's adjusted net margin is accelerating sharply for the fifth consecutive year, more than quadrupling from 2% in fiscal 2021 to a trailing margin of 8.4% as we await Disney's fiscal 2026 report next month. The company is delivering on the bottom line.
Premium Feature
Moneyball Superscore
75/100
Today's Change
(
0.60
%) $
0.65
Current Price
$
108.70
2. Cheap is an understatement The overall market is trading at lofty multiples these days. The same can't be said about Disney stock. You can buy a piece of the iconic entertainment powerhouse for just 14 times what analysts see it earning in the new fiscal year that started earlier this month.
Like a limbo stick, that multiple gets lower as the game plays on. Project out to what these same Wall Street pros are modeling, and Disney is trading for just 11 times fiscal 2031's earnings.
Naturally, Disney's trailing P/E ratio would be twice that much if it were to double from here, but this doesn't mean that Disney at $216 in five years means that it's trading for 22 times trailing earnings. Disney has routinely exceeded expectations, and analysts have been perpetually raising their targets. The company has landed 3% to 11% above the market's bottom-line expectations over the past year, even as the stock ticked lower.
3. Mickey Mouse makes monster movies There were just three theatrical releases by U.S. studios that topped $1 billion in global ticket sales in 2024. Disney put out all three. The same thing happened last year.
It's been different in 2026. A lot of studios have been cranking out blockbusters, and Disney will have just two releases clear the $1 billion mark in box-office receipts.
That's not a bad thing. Folks are going out to the movies again. There will be at least six movies that exceed $1 billion in worldwide sales this year, something that has only happened once before.
With the return to pre-pandemic ticket sales and a now-profitable Disney streaming business, Disney has a one-two punch to cash in on every theatrical release. This is the first time this has been the case since the demise of the once-lucrative home video sales market.
4. Theme parks are generating record results Experiences have been Disney's most potent business segment in recent years. Its theme parks and rapidly expanding cruise line are cashing in on consumers' craving for premium, family-friendly vacation environments.
The segment accounts for 39% of Disney's revenue through the first nine months of fiscal 2026 and a whopping 61% of the operating profit. Expansion is underway at Disney's gated attractions worldwide. Last week's reveal of the unique features of Disney Believe -- its latest cruise ship that will set sail next year -- gives it another way to cash in on the travel boom.
5. Folks aren't flinching at higher prices The best thing about being a premium player with a killer brand in a thriving niche is that you have pricing elasticity. Disney raised theme park prices last week. Disney+ and Hulu monthly subscription rates went up last month.
You may have seen some online rumblings about the hikes, and there may be some degree of churn. The real takeaway here is that Disney has done this at its theme park resorts and premium streaming services practically every year. The businesses continue to grow because consumers see Disney investing in new park experiences and streaming content.
The only price at Disney that doesn't seem to be rising these days is its stock price. My prediction is that the upticks are coming next. I believe that Disney can double from here in the next five years.
Investors interested in Media Conglomerates stocks are likely familiar with Versant (VSNT - Free Report) and Walt Disney (DIS - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Versant has a Zacks Rank of #2 (Buy), while Walt Disney has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that VSNT likely has seen a stronger improvement to its earnings outlook than DIS has recently. But this is just one piece of the puzzle for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
VSNT currently has a forward P/E ratio of 7.51, while DIS has a forward P/E of 14.47. We also note that VSNT has a PEG ratio of 0.67. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. DIS currently has a PEG ratio of 1.25.
Another notable valuation metric for VSNT is its P/B ratio of 0.53. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, DIS has a P/B of 1.6.
Based on these metrics and many more, VSNT holds a Value grade of A, while DIS has a Value grade of C.
VSNT is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that VSNT is likely the superior value option right now.
BURBANK, Calif.--(BUSINESS WIRE)--The Walt Disney Company (NYSE: DIS) will host a live webcast to discuss fiscal full year and fourth quarter 2026 financial results beginning at 8:30 a.m. ET / 5:30 a.m. PT on Tuesday, November 17, 2026.Disney will release results before the opening of regular trading on November 17, 2026 and post earnings materials at www.disney.com/investors.To access the webcast, please visit www.disney.com/investors. The webcast will be archived.Materials and webcast may incl.
Walt Disney (DIS - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Shares of this entertainment company have returned +1.4% over the past month versus the Zacks S&P 500 composite's +2.4% change. The Zacks Media Conglomerates industry, to which Disney belongs, has gained 14.8% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
Disney is expected to post earnings of $1.68 per share for the current quarter, representing a year-over-year change of +51.4%. Over the last 30 days, the Zacks Consensus Estimate has changed +2.7%.
For the current fiscal year, the consensus earnings estimate of $6.92 points to a change of +16.7% from the prior year. Over the last 30 days, this estimate has changed -0.1%.
For the next fiscal year, the consensus earnings estimate of $7.47 indicates a change of +7.9% from what Disney is expected to report a year ago. Over the past month, the estimate has changed -0.1%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Disney is rated Zacks Rank #3 (Hold).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of Disney, the consensus sales estimate of $25.29 billion for the current quarter points to a year-over-year change of +12.6%. The $101.63 billion and $106.38 billion estimates for the current and next fiscal years indicate changes of +7.6% and +4.7%, respectively.
Last Reported Results and Surprise HistoryDisney reported revenues of $25.25 billion in the last reported quarter, representing a year-over-year change of +6.8%. EPS of $2.06 for the same period compares with $1.61 a year ago.
Compared to the Zacks Consensus Estimate of $25.48 billion, the reported revenues represent a surprise of -0.91%. The EPS surprise was +9.57%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates just once over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Disney is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Disney. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
SummaryThe Walt Disney Company is rated "Buy", with a partial position recommended below $110 and a 12–18% return target over 12–18 months.DIS's Experiences segment drives 57% of profits on 38% of revenue, with aggressive cruise expansion leveraging its unique IP and premium pricing.Free cash flow is projected at ~$10B in fiscal 2026, but heavy capital expenditures and buybacks create tension in cash coverage for dividends and repurchases.I will only add to DIS once free cash flow fully covers buybacks and dividends; creative renewal of original IP is essential for long-term growth.sutichak/iStock via Getty Images
The Walt Disney Company (DIS) is expected to spend $18B+ in fiscal 2026. Of that, roughly $9B will go toward capital expenditures, and $9B will go toward share repurchases. Free cash flow after capital expenditures is only around $10B, and that's before share buybacks, capital spending, and
137 Followers
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in DIS over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of NFLX, META either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
In the latest trading session, Walt Disney (DIS - Free Report) closed at $107.09, marking a +2.23% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 0.47% for the day. Elsewhere, the Dow saw an upswing of 0.1%, while the tech-heavy Nasdaq depreciated by 1.25%.
Coming into today, shares of the entertainment company had gained 0.55% in the past month. In that same time, the Consumer Discretionary sector lost 2.96%, while the S&P 500 gained 1.15%.
Analysts and investors alike will be keeping a close eye on the performance of Walt Disney in its upcoming earnings disclosure. The company is expected to report EPS of $1.68, up 51.35% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $25.29 billion, indicating a 12.58% growth compared to the corresponding quarter of the prior year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.92 per share and a revenue of $101.63 billion, representing changes of +16.69% and +7.63%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Walt Disney. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.05% lower. As of now, Walt Disney holds a Zacks Rank of #3 (Hold).
Digging into valuation, Walt Disney currently has a Forward P/E ratio of 14.03. This valuation marks a premium compared to its industry average Forward P/E of 13.48.
We can also see that DIS currently has a PEG ratio of 1.21. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Media Conglomerates industry held an average PEG ratio of 1.21.
The Media Conglomerates industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 176, putting it in the bottom 29% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
Today, Disney confirmed that Disney+ will be the streaming host for the 2027 Super Bowl. Bloomberg's Geetha Ranganathan says that this is necessarily a surprise.
Your neighbor's putting up inflatable skeletons in her yard. The Major League Baseball playoff season is under way. And Walt Disney (DIS +0.51%) is raising ticket prices. These are a;; seasonal rites this time of year. Why is it that only one of them surprises people?
Yes, Disney hiked prices on many annual passes and single-day tickets for its domestic theme parks this week. The same thing happened in early October last year. It was also a cause celebre this month two years ago. And the year before that.
We can talk about the severity of the increases this time around. There will be some people lamenting on Disney fan forums that they've been priced out of the Disney World and Disneyland experience. I don't want to dismiss that. It hurts to see special things become unattainable. However, as long as people keep coming -- and paying those higher prices -- do you think that next October will be any different?
Image source: Disney.
Pass the salt Florida's Disney World is the most visited theme park on the planet. Its annual turnstile clicks -- according to industry tracker TEA/AECOM -- have declined just twice in the last 14 years (through 2024, last year's numbers should be coming soon). There was a scant 0.5% dip in 2016. Then there was a hard reset in 2020 in the aftermath of a four-month closure at the resort. Prices went up almost every year.
The headline grabber is that Disney World's priciest annual pass -- the Incredi-Pass, which provides year-round access without any blackout dates -- is now $1,749 per person. This is a steep $120 increase, but isn't that just $0.33 more a day? The 7% increase does outpace inflation, but it's a different story at the low end. The Pirate Pass, available only to Florida residents, is valid only for non-holiday weekday visits and now costs just $10 more, at $499 per year. The 2% increase is a discount to both inflation and Disney's own rising costs of serving its guests.
Premium Feature
Moneyball Superscore
75/100
Today's Change
(
0.51
%) $
0.53
Current Price
$
104.56
Salt the pass Disney stock has been a market laggard for years, but you can't lay the blame at the feet of the media giant's experiences segment. It sells cruises at a market premium, but it's seeing strong trends to warrant expanding its fleet faster than traditional cruising companies. Its theme parks continue to grow, cranking out record results.
The $1,749 Incredi-Pass annual pass or one-day tickets, now as high as $229 during peak travel periods, will be ammo for the naysayers. The irony is that those same moves provide ammo for shareholders. If Disney starts to become a hot investment again, it will be because it monetized its good fortune without losing its audience. The headlines this week appear mean-spirited, for what is essentially a reasonable 2% to 7% annual pricing adjustment. Disney knows what it's doing.
Disney announced Wednesday that its streaming service Disney+ will air the upcoming Super Bowl in February.
The 2027 championship game, as well as two Monday Night Football games leading up to the Super Bowl, will be available to all Disney+ subscribers in the U.S.
Disney had previously announced that its ESPN sports division would produce the Super Bowl in 2027 for the first time ever. The game will air on ESPN and Disney's broadcast network, ABC.
Interest in the upcoming Super Bowl is already high. Disney said on its most recent earnings call that ad spots for the game are already sold out, the earliest sellout in Super Bowl history, according to a press release.
The announcement is the latest move in Disney's efforts to expand its live sports streaming offerings. The media company last year launched a standalone ESPN streaming service, bringing the content outside the cable bundle.
In August, Disney announced that Formula E — the open-wheel racing championship for electric cars — will be available to Disney+ subscribers beginning Dec. 18.
Other streamers are also using live sports to bolster their portfolios. CNBC reported last week that Alphabet's YouTube is actively searching for additional live sports rights. YouTube already pays roughly $2 billion annually for the rights to "NFL Sunday Ticket," which will last until the end of the 2029-30 season.
Netflix will air five NFL games during the 2026-27 season. Netflix Chief Content Officer Bela Bajaria said in a CNBC interview last month that the company would be open to acquiring the rights to international NFL games if they become available.
Skydance just closed the deal everyone was watching, and the market responded by punishing the buyer. Whether that selloff reflects a debt problem or a passing reaction depends on what happens next with the integration.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
The Warner Bros. Discovery deal that traders spent months positioning around is finally done, and Skydance (NYSE:SKYD) stock is now absorbing the arrival of the event itself. Skydance shares are sinking 8% to $8.73 this morning after the company closed its acquisition of Warner Bros. Discovery. This may surprise some traders, but it could also be viewed as a familiar “sell-the-news” reaction when a long-anticipated catalyst arrives.
Rival entertainment companies are barely reacting, which points to a repricing specific to Skydance. Meanwhile, Netflix (NASDAQ:NFLX | NFLX Price Prediction) stock is nearly unchanged as it’s down 0.3% to $68.51, as the global streaming specialist faces a larger rival for viewers and content. Walt Disney (NYSE:DIS) shares are slipping 0.5% to $103.50, a modest dip for a company that competes head-on with the combined studio in theaters, streaming and television.
At the same time, the Communication Services Select Sector SPDR ETF (NYSEARCA:XLC) is down 0.9% to $110.59, trailing the SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which is slipping 0.6% to $774.69. All in all, Skydance stock’s decline stands out as company-specific.
Debt-Funded Close Sets the Tone The deal closed on October 6, and Warner Bros. Discovery shareholders received $31.02 per share in cash under the terms of the merger agreement, according to Skydance Corporation. Warner Bros. Discovery stock was delisted from the Nasdaq exchange as Skydance Class B shares began trading on the New York Stock Exchange under a new ticker. That debut replaced the former Paramount Skydance listing on the Nasdaq exchange.
Skydance financed that cash payout with borrowed money. At the end of September, ahead of closing, the company priced senior secured notes and term loan facilities to fund the transaction. The market is now considering those borrowings against the combination’s scale.
Three Answers to How Scale Pays for Content After the close, Skydance runs three segments covering studios, direct-to-consumer streaming and television media. The company brings two film studios and two streaming services under one owner, with a portfolio including Paramount, Warner Bros., HBO and HBO Max, Paramount+, Pluto TV, CBS and CNN.
Netflix sells a single global streaming subscription with no broadcast or cable business attached. Walt Disney pairs its streaming services with parks, studios and networks. Alongside Skydance, the three companies represent three different answers to the same question about how scale pays for content.
Scale Versus Leverage at Skydance Skydance stock’s bull case rests on scale. The combination creates a library and a streaming base few competitors can match, and the company has set a stated multi-billion-dollar run-rate cost savings target over the next three years. Delivering those savings could give the combined business more room to invest in content while it services its borrowings.
A heavier debt load drives the bear case for Skydance. Borrowing funded the company’s cash payout to Warner Bros. Discovery shareholders, leaving Skydance heavily indebted during a complex integration. Any slip in that integration could pressure Skydance stock, given how little buffer a leveraged balance sheet provides.
What to Watch Next Skydance’s next test is whether the promised savings arrive on the stated schedule, since that target is what the company’s debt is being serviced against. Integration updates could signal whether the cost program is on track.
Netflix and Walt Disney shares look firmer, with each company’s model less exposed to Skydance stock’s integration risk. Shareholders may want to reduce their SKYD share exposure and also watch for whether the combined portfolio pressures streaming pricing or theatrical slates over the coming quarters.
Contact [email protected] for any questions or corrections.
The Walt Disney Company NYSE: DIS recently executed a content licensing agreement to syndicate intellectual property to Netflix, Inc. NASDAQ: NFLX. Selectively opening its proprietary ecosystem to share titles like "Percy Jackson and the Olympians" alongside legacy "Ice Age" films serves as a structural pivot. Disney is signaling that strict streaming exclusivity is not always the most financially efficient model. Facing pressure from declining legacy television networks and a heavy balance sheet, legacy media entities are retreating to historical roles as arms dealers. This transition formally cements Netflix as the apex digital aggregator, operating with clear free cash flow dynamics and pricing power.
Get Walt Disney alerts:
Breaching the Castle: Disney Abandons the Walled GardenFriday, Oct. 2, 2026, Disney and Netflix announced a content licensing agreement transferring streaming rights for several high-profile properties to Netflix. The slate includes the first two seasons of the Disney+ original series "Percy Jackson and the Olympians," all five "Ice Age" films, and select Disney and Pixar titles. Rather than a total asset liquidation, the agreement operates partly on a short-term promotional framework. Disney grants Netflix titles for temporary three-month windows to reach its audience of approximately 325 million global subscribers.
The timing directly precedes the release of exclusive installments on Disney-owned properties, such as the November premiere of the third season of "Percy Jackson" on Disney+ and the February 2027 theatrical release of the next "Ice Age" installment. Under CEO Josh D'Amaro, Disney can use Netflix as a top-of-funnel marketing engine. The transaction generates immediate licensing revenue while driving broad audience awareness for Disney's exclusive sequels.
This unwinds years of strict platform exclusivity. During the initial phases of the streaming transition, media conglomerates hoarded their intellectual property to drive subscriber growth at all costs. Sinking billions into proprietary platforms was viewed as the only path to survival. Moving away from strict exclusivity signals that legacy studios increasingly see value in external distribution scale alongside their own platforms. Renting select content to a primary competitor is a pragmatic recognition that licensing revenue can sometimes outweigh the benefits of keeping every title exclusive.
The Debt Moat: Linear Decay Forces Disney's HandThe underlying forces driving this syndication strategy stem from deterioration in legacy television networks. Operating income across Disney's Linear Networks fell about 20% year over year. Relentless cord-cutting and persistent pressure on television advertising have compressed margins, forcing management to look outside its proprietary platforms to monetize existing assets. Linear television historically functioned as a reliable cash engine that funded speculative growth initiatives, and its accelerated decline removes a critical safety net.
Walt Disney Today
$104.37 +0.34 (+0.33%)
As of 01:46 PM Eastern
This is a fair market value price provided by Massive. Learn more.
$92.18▼
$117.091.44%
21.53
$128.06
Compounding linear decay is Disney's restrictive balance sheet. Disney carries approximately $46 billion in total debt. Servicing this obligation while funding capital-intensive theme park expansions makes the cash-burning exclusive streaming model difficult to sustain. Prioritizing subscriber acquisition over profitability is a luxury that media companies carrying significant debt can no longer afford. Debt acts as a gravitational pull on corporate strategy, demanding predictable cash generation to appease credit rating agencies and dividend-seeking shareholders.
The necessity to generate additional cash flow pushes the company back toward traditional syndication economics. By monetizing older catalog titles through an external distributor, management can generate incremental licensing revenue without incurring additional production or customer acquisition costs. This is not a sign of operational failure but rather a return to the arms-dealer business model that originally made Hollywood studios so profitable in the late 20th century.
The Margin Chasm: Netflix's Cash Flow SupremacyFinancial metrics reveal a wide disparity in cash generation and profitability between the two companies. Netflix expects to generate $12.5 billion in free cash flow in 2026, up from its previous $11 billion forecast. The company's operating margins are expanding past 32%, with trailing net margins standing at about 28% and return on equity at roughly 40%.
Netflix Today
$69.36 +0.67 (+0.97%)
As of 01:46 PM Eastern
This is a fair market value price provided by Massive. Learn more.
$65.08▼
$124.8621.83
$94.94
This liquidity profile allows Netflix to absorb licensing premiums easily while reinforcing its library and cementing its status as a major aggregator for digital entertainment. Netflix can amortize the cost of acquiring licensed content across a subscriber base far larger than any competitor, mathematically ensuring a higher return on investment per title.
In contrast, Disney operates with a net margin of 8.7% and a return on equity of around 9.9%. The strategic pivot to license content provides another way to monetize its catalog as the company works to improve profitability. Keeping most Disney-branded titles exclusive protects Disney+'s core value proposition, while syndicating secondary properties lets Disney extract value from sunk costs.
The move trades some exclusivity for immediate tangible licensing revenue, prioritizing balance sheet health over raw subscriber metrics. For years, Wall Street rewarded media companies solely for subscriber additions. The market environment has shifted toward value profitability and free cash flow yields. Disney's management is adjusting its operational framework to meet these current market realities.
Crown Jewels: Trading the CapitulationThe content licensing agreement highlights a broader shift in digital media distribution. Netflix has built an economic moat through superior free cash flow and enormous distribution scale. Netflix's stock currently trades near $68, with a forward price-to-earnings ratio of about 19 and a PEG ratio of 0.95. These valuation metrics indicate a balanced price relative to expected growth. Institutional backing remains high at just over 80%, providing a stable foundation for the equity.
Disney's structural pivot does not classify it as a distressed asset, but rather a mature company returning to foundational economics. Disney trades at a forward price-to-earnings ratio of nearly 15 with a well-covered 1.45% dividend yield; the company is executing a measured margin-expansion strategy. Short interest sits at just 1.14%, reflecting limited broader market pessimism. Insider activity at Disney has also been limited, with MarketBeat reporting two insiders selling shares over the past 12 months and no insider purchases.
Growth-oriented investors may view Netflix as a core growth holding positioned to benefit from ongoing industry licensing shifts and its substantial pricing power. Conversely, investors seeking steady income might look to legacy media entities like Disney, which are increasingly prioritizing free cash flow and dividend sustainability over aggressive digital expansion. Cautious investors may prefer to wait for stabilization in linear advertising revenues before taking a position in traditional entertainment equities.
Should You Invest $1,000 in Walt Disney Right Now?Before you consider Walt Disney, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Walt Disney wasn't on the list.
While Walt Disney currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Discover the 10 Best High-Yield Dividend Stocks for 2026 and secure reliable income in uncertain markets. Download the report now to identify top dividend payers and avoid common yield traps.
Get This Free Report
Continue following MarketBeat
Add MarketBeat as your preferred source on Google to see our latest stories in your feed.
Walt Disney (DIS +0.41%) has historically been known as a leader in cable TV, thanks to popular networks like ABC and ESPN. In recent years, the company's streaming operations have gotten a lot of attention, thanks to the success of Disney+ and Hulu, as well as the launch of the stand-alone ESPN platform.
These are important to Walt Disney, to be sure. However, investors should understand that these parts of the business pale in comparison to the entertainment stock's most lucrative segment.
Image source: The Motley Fool.
During third-quarter 2026 (ended June 27), Disney's experiences segment posted 10% year-over-year revenue growth. This was a better gain than any other segment. Its sales figure of $10 billion accounted for 40% of the entire company's total.
Operating income for experiences soared 20%. This profit metric represented 54% of the company's total operating income.
Premium Feature
Moneyball Superscore
75/100
Today's Change
(
0.41
%) $
0.42
Current Price
$
104.03
The experiences segment includes the theme parks and cruises. These make up what is arguably the most competitively advantaged segment of the business. They have high barriers to entry, and because Disney owns an immense portfolio of intellectual property, these experiences are differentiated in the industry. Consequently, they have historically had pricing power.
Despite the scale of this division, there is still a sizable growth runway to capture. In September 2023, the management team announced a 10-year, $60 billion capital investment plan to bolster the experiences segment in an effort to reach more people around the world. This can support the overall company's long-term financial performance.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walt Disney. The Motley Fool has a disclosure policy.
Lawyers for Disney accused the Trump administration of “blatant violations of the US constitution” and censorship on Tuesday in the first court hearing over the Federal Communications Commission’s early review of the media giant’s eight local television station licenses.
District judge Loren AliKhan seemed unswayed by government arguments that the order to force Disney’s ABC to apply years early to renew local television station licenses was tied to an investigation into parent company Disney’s hiring practices.
ABC, Disney and its station group filed suit against the FCC in August, seeking to block the US media regulator from taking any further steps to punish or pressure the network in connection to the order.
In its lawsuit, ABC argued that the FCC’s actions – taken at the behest of the Donald Trump-appointed chair, Brendan Carr – were actually intended to chill the network’s speech, which the president and Carr have argued is tilted against the administration.
In legal filings and during Tuesday’s hearing, the network cited past threats by the president and the FCC chairman that jeopardized the licenses of television networks, including ABC on several occasions, for editorial purposes.
“These are blatant violations of the US constitution,” the prominent trial lawyer Beth Wilkinson, arguing on behalf of ABC, told the judge during the approximately two-hour hearing.
She said ABC faced a “chilling effect” that has affected – and will continue to impact – its editorial decision-making, as the network steers clear of political bookings and any other programming decisions that could spark further ire from the Trump administration and Carr. “That chilling effect has been happening and will happen every day,” she said, causing “irreparable harm” to the network and its ability to broadcast independent news for the benefit of the American people.
ABC has said it has stopped booking politicians on the daytime talkshow The View and chose to air a July speech by Trump on its streaming platform so as not to antagonize the president. “Our editorial decisions are being affected right now,” Wilkinson said, noting the significance of decisions about how to cover next month’s pivotal midterm elections. “We are watching everything we do … We have already altered our conduct because of the fear of retaliation.”
She also noted that ABC recently chose to air a Jimmy Kimmel-conducted interview with Texas US Senate candidate James Talarico on YouTube, rather than television, “because the FCC has no control over YouTube”.
Dimitar P Georgiev, representing the FCC defendants, argued that “there is no reason to believe the early renewal order has prompted changes to the plaintiffs’ editorial decisions”. He also argued that the US district court for the District of Columbia was not the proper jurisdiction for the case, saying that ABC could instead appeal any adverse decision to the US court of appeals for the District of Columbia.
ABC is seeking a decision from the judge to enjoin the FCC from taking any further actions against the network’s licenses. “We are asking to stop pure retaliation, putting us in a process that we should never have to be in,” Wilkinson said.
In what Wilkinson called a “fatal admission”, Georgiev said the license renewal process “is not about the licenses”, but is instead a “tool” to expedite the commission’s review of ABC for potential violations of federal equal opportunities regulations. The lawyer also said the FCC could choose to end the license review process early if ABC is able to satisfy its document requests.
Considering that the FCC opened its employment practice investigation into Disney last year, with requests for documents ongoing since then, the judge asked: “Why is it only in the summer that you determined that their responses were woefully inadequate?”
She also questioned why the commission required the company to submit renewal applications for all eight of its stations simultaneously.
And she noted past comments by Carr about the network’s licenses, including a remark in July, when he had said ABC’s decision not to carry the president’s speech that month on its linear channel could factor into the license investigation.
“It strikes me with all the comments that this was merely over a discovery dispute, what made this so different that you needed to call for an early license renewal?” Judge AliKhan asked lawyers for the FCC, whom she asked for a list of some of the other enforcement actions the commission could have taken short of calling up the network’s licenses early.
And she noted that there was “some daylight” in the FCC’s arguments, considering that the diversity, equity and inclusion (DEI) inquiry was handled by the commission’s enforcement bureau, while the license order was made by the media bureau.
The judge ended the hearing without issuing an order, saying she would take the matter “under advisement”.
Disney on Tuesday raised the price of admission to “the happiest place on Earth,” with a premium ticket to Disney World nearing a painful $500, though the cheapest tickets remain unchanged.
Disney World’s top-of-the-line “Incredi-Pass,” which lets Mickey Mouse fanatics skip lines, went up by $120, while the annual top-tier pass went up by the same amount, to around $1,800.
Still, execs insisted the company is sensitive to families’ budgets as they face stubborn inflation and other economic challenges.
Tickets to Disney World have gone up. MediaNews Group via Getty Images “Our goal is to put guests at the center of our decision making, and that starts by listening to them,” Thomas Mazloum, chairman of Disney Experiences, told CNN.
“That matters more now when families are watching every dollar, and we see it in the choices they make every day — in how they plan, in how far ahead,” he added.
The cheapest Disney World tickets was unchanged, at around $120 for a day at Animal Kingdom.
The base ticket price at Disneyland held at $104.
A peak travel-season ticket for someone hoping to go to multiple parks in 2027 will cost $300 at Disney World.
Meanwhile, Disney is testing an AI tool for some visitors to its website that lets them ask questions such as, “What are the cheapest dates to visit by month and season?,” USA Today noted.
Disney CFO Hugh Johnston recently said the House of Mouse cares about prices, adding that the company wants to attract younger families.
The company’s aim is to keep the base ticket price low while add-ons like park hopping and line jumping will cost more, the exec said last month.
Disney is offering a range of attractions to keep the thrill alive.
Disney’s “Incredi-Pass” went up by $120 — and the parks’ annual top-tier pass price went up to around $1,800. Getty Images In celebration of its 55th anniversary, the Magic Kingdom at Disney World is getting its largest expansion in history. The park will include a new section centered around the “Cars” movies, in addition to a spooky new area called Villains Land.
Animal Kingdom will also get a new area with Indiana Jones- and “Encanto”-themed experiences. A “Monsters, Inc.” inspired section will open at Hollywood Studios, too.
Overall park attendance was up 3% in the spring, according to Disney.
Last week, Disneyland Paris had to turn guests away after both of its theme parks were sold out. Many of the guests were Americans who traveled overseas after calculating that a Euro-trip would be cheaper than a trek to Orlando.
The company as a whole has been downsizing. Last month, Disney laid off several hundred employees in the company’s television section. That followed a round of about 1,000 firings — conveyed over email — earlier this year.
Horacio Gutiérrez battled regulators at Microsoft and took on Apple at Spotify. Now he's leading Disney's First Amendment clash with the Trump administration.
Signage is seen at the headquarters of the Federal Communications Commission in Washington, D.C., U.S., August 29, 2020. REUTERS/Andrew Kelly Purchase Licensing Rights, opens new tab
CompaniesWASHINGTON, Oct 6 (Reuters) - A US judge on Tuesday will hold a hearing on Walt Disney's (DIS.N), opens new tab lawsuit seeking to block the Federal Communications Commission's early review of licenses for the firm's eight company-owned ABC stations.
The lawsuit, filed in August, poses a key test for First Amendment free speech rights of broadcasters versus the Trump administration's efforts to reshape the media landscape and force a "course correction."
Sign up here.
President Donald Trump has repeatedly urged broadcasters to drop comedy or news programs he dislikes or which have joked about or criticized him or his administration. He has also repeatedly called on the FCC to strip stations of licenses after criticizing news and other programming.
In its suit, Disney said the FCC is seeking to coerce and retaliate against "a network that refuses to bow to the administration's demands," calling the agency's actions an "extraordinary assault on free speech."
US District Judge Loren AliKhan previously declined to hand down an order barring the FCC from issuing an order to refer Disney's ABC licenses for a public hearing. The FCC has agreed to provide at least 48 hours' notice to the court before moving ahead.
AliKhan is holding a hearing to determine whether she should issue a temporary restraining order.
FCC Chair Brendan Carr, who ordered the early reviews in April, even though the ABC stations' license renewals were not scheduled to be considered before October 2028, said last week that he has made no decisions on how to proceed.
The FCC had not ordered an early review in more than 50 years before April.
The reviews were ordered a day after Trump urged ABC to fire late-night host Jimmy Kimmel.
Broadcast stations need FCC licenses to use public airwaves. While license revocations are extremely rare, critics say threats of losing a license can pressure broadcasters and raise concerns about government interference in programming decisions.
The FCC is also investigating ABC daytime talk show "The View," which discusses politics, after saying it may be subject to federal rules requiring broadcasters to provide equal opportunities to political candidates. Disney noted that since February, the program has not invited any political candidates to appear, citing the FCC’s "pressure campaign."
Last month, Kimmel said FCC threats prevented the airing of his interview with Texas Democratic Senate candidate James Talarico during a broadcast. The interview was instead posted on YouTube, where it has been viewed over 13 million times.
Reporting by David Shepardson; Editing by Thomas Derpinghaus
Our Standards: The Thomson Reuters Trust Principles., opens new tab
MassMutual Private Wealth & Trust FSB cut its holdings in The Walt Disney Company (NYSE:DIS – Free Report) by 45.3% in the 3rd quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The institutional investor owned 17,664 shares of the entertainment giant’s stock after selling 14,638 shares during the period. MassMutual Private Wealth & Trust FSB’s holdings in Walt Disney were worth $1,694,000 at the end of the most recent quarter.
A number of other institutional investors and hedge funds also recently modified their holdings of DIS. Advisors Management Group Inc. ADV grew its position in Walt Disney by 4.6% during the first quarter. Advisors Management Group Inc. ADV now owns 2,266 shares of the entertainment giant’s stock valued at $218,000 after buying an additional 100 shares during the period. Providence Wealth Advisors LLC increased its stake in shares of Walt Disney by 1.1% during the 1st quarter. Providence Wealth Advisors LLC now owns 9,192 shares of the entertainment giant’s stock worth $888,000 after purchasing an additional 100 shares during the last quarter. Guardian Partners Inc. raised its holdings in shares of Walt Disney by 0.3% in the 1st quarter. Guardian Partners Inc. now owns 32,991 shares of the entertainment giant’s stock worth $3,188,000 after purchasing an additional 101 shares during the period. Chapin Davis Inc. raised its holdings in shares of Walt Disney by 0.3% in the 2nd quarter. Chapin Davis Inc. now owns 32,101 shares of the entertainment giant’s stock worth $3,090,000 after purchasing an additional 103 shares during the period. Finally, Bannerman Wealth Management Group LLC lifted its stake in Walt Disney by 4.4% in the second quarter. Bannerman Wealth Management Group LLC now owns 2,609 shares of the entertainment giant’s stock valued at $251,000 after purchasing an additional 109 shares during the last quarter. 65.71% of the stock is owned by hedge funds and other institutional investors.
Wall Street Analyst Weigh In Several brokerages have weighed in on DIS. Barclays increased their price objective on Walt Disney from $110.00 to $115.00 and gave the company an “overweight” rating in a report on Thursday, August 6th. Rosenblatt Securities restated a “buy” rating and issued a $126.00 target price on shares of Walt Disney in a research note on Thursday, August 6th. UBS Group set a $115.00 price target on Walt Disney in a research report on Monday, August 24th. Truist Financial set a $115.00 price target on Walt Disney in a research note on Monday, August 3rd. Finally, Guggenheim reaffirmed a “buy” rating and set a $120.00 price objective on shares of Walt Disney in a report on Monday, September 28th. One investment analyst has rated the stock with a Strong Buy rating, sixteen have assigned a Buy rating, three have assigned a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $128.06.
Get Our Latest Analysis on Walt Disney Insider Buying and Selling In other Walt Disney news, EVP Paul Roeder sold 3,596 shares of the stock in a transaction that occurred on Wednesday, August 19th. The shares were sold at an average price of $106.32, for a total value of $382,326.72. The transaction was disclosed in a legal filing with the SEC, which is available through this link. Also, EVP Brent Woodford sold 3,618 shares of the firm’s stock in a transaction on Tuesday, September 1st. The shares were sold at an average price of $107.13, for a total transaction of $387,596.34. Following the completion of the transaction, the executive vice president directly owned 62,328 shares of the company’s stock, valued at approximately $6,677,198.64. The trade was a 5.49% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 14,452 shares of company stock worth $1,532,157 in the last ninety days. 0.17% of the stock is currently owned by insiders.
Key Walt Disney News Here are the key news stories impacting Walt Disney this week:
Positive Sentiment: Raymond James maintained an Outperform rating while trimming its price target modestly to $119 from $120, still implying meaningful upside from recent trading levels. Raymond James Adjusts PT on Walt Disney Positive Sentiment: Disney is licensing a group of films and television shows to Netflix, including major franchise content. The agreement could generate licensing revenue and expand the reach of Disney intellectual property, although it also places content on a rival streaming platform. Disney Licenses Major Movie and Show Franchises to Netflix Positive Sentiment: Disney World plans to raise ticket prices, a potentially favorable sign for per-guest spending and theme-park revenue, though higher prices could affect attendance or consumer sentiment. Disney World to Increase Prices on All Tickets Neutral Sentiment: Disney is purchasing the former Yamaha headquarters campus near Anaheim for $115 million. The acquisition could support future operations or development, but the immediate financial benefit is unclear. Disney Buys Former Yamaha Headquarters Neutral Sentiment: Disney’s president and chief creative officer dismissed reports of a potential Epic Games acquisition, reducing speculation about a major gaming deal but providing no new transaction catalyst. Disney Dismisses Epic Games Buyout Rumors Negative Sentiment: Disney plans to restructure its television division, with hundreds of jobs reportedly at risk. The move may improve efficiency and support a streaming-focused strategy, but near-term disruption and continued pressure on traditional television weigh on sentiment. Disney Television Restructuring Negative Sentiment: Rain and tropical-weather alerts, extended attraction closures and a confirmed future resort closure could temporarily disrupt Disney World attendance and spending. Walt Disney World Faces a Week of Rain Walt Disney Stock Up 1.5% Shares of NYSE DIS opened at $103.70 on Tuesday. The business has a 50-day simple moving average of $104.66 and a two-hundred day simple moving average of $101.82. The Walt Disney Company has a 52 week low of $92.18 and a 52 week high of $117.09. The company has a market cap of $179.06 billion, a P/E ratio of 21.38, a P/E/G ratio of 1.18 and a beta of 1.41. The company has a quick ratio of 0.65, a current ratio of 0.71 and a debt-to-equity ratio of 0.32.
Walt Disney (NYSE:DIS – Get Free Report) last announced its quarterly earnings results on Wednesday, August 5th. The entertainment giant reported $2.06 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.86 by $0.20. Walt Disney had a net margin of 8.70% and a return on equity of 9.90%. The firm had revenue of $25.25 billion for the quarter, compared to the consensus estimate of $25.39 billion. During the same period in the prior year, the firm posted $1.61 earnings per share. The company’s revenue for the quarter was up 6.8% on a year-over-year basis. Walt Disney has set its FY 2026 guidance at 6.642-6.642 EPS. Research analysts anticipate that The Walt Disney Company will post 6.93 earnings per share for the current fiscal year.
Walt Disney Profile (Free Report)
The Walt Disney Company (NYSE:DIS) is a global entertainment company that develops, produces and distributes branded content across film, television, streaming and other media platforms. Its portfolio includes Disney, Pixar, Marvel, Star Wars, National Geographic and 20th Century Studios, as well as ABC, Hulu, Disney+ and ESPN. The company also licenses its characters and intellectual property for consumer products, games and other experiences.
Disney operates theme parks, resorts and cruise lines through its Experiences business.
Recommended Stories Five stocks we like better than Walt Disney NVIDIA’s Record High Raises a Bigger Question About How Far the Rally Can Run A Manufacturing Surprise Could Be a Big Win for These 2 Companies What a $1 Billion Chip Deal Says About Amazon’s AI Ambitions 3 Stocks Benefiting From AI Demand Just Announced Major Buybacks Want to see what other hedge funds are holding DIS? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for The Walt Disney Company (NYSE:DIS – Free Report).
Receive News & Ratings for Walt Disney Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Walt Disney and related companies with MarketBeat.com's FREE daily email newsletter.
Walt Disney (DIS +1.39%) and Nike have been iconic brands for decades. They have, however, been struggling of late. Their valuations have been declining, and generating strong growth has also been much more of a challenge than it has been in the past. Both have also changed CEOs in recent years.
Disney's decline hasn't been as disastrous as Nike's (it has lost nearly 80% of its value in five years), but it could end up following the same path. Here's why I think investors are better off avoiding the entertainment stock.
Image source: Getty Images.
Why Disney's stock could be in troubleI see many similarities between Disney and the apparel company Nike. They are in entirely different sectors of the economy, but the problems are comparable. Nike has long been a premium brand, but demand for its high-priced products has declined sharply. The business is struggling to turn things around.
Disney is still growing its business and generating decent numbers, but how long that may last is questionable. Between rising prices and long lines, it's debatable just how much value an experience at one of Disney’s parks really offers families these days. It may face a reckoning in the near future, especially as inflation strains consumers' budgets and they opt for cheaper travel and entertainment options.
I also see the modest growth in its entertainment segment (it was just 6% last quarter), which includes its Disney+ streaming service, as another example of the challenges the brand is facing these days in winning over consumers.
Premium Feature
Moneyball Superscore
75/100
Today's Change
(
1.39
%) $
1.42
Current Price
$
103.61
The stock is cheap, but that doesn't mean it can't go lowerDisney's stock is trading at 21 times its trailing earnings, which is modest in relation to the S&P 500 average of 23. And the gap widens when looking at the forward price-to-earnings (P/E) multiple, which considers the earnings growth ahead for the business (based on analyst projections). Disney's stock is trading at a forward P/E of 14, while the S&P average is 20.
But a low valuation is not a surefire strategy for buying stocks. They can dip lower, especially ones that appear to be in trouble, which is my assessment of Disney. The brand may be losing its luster, and while it's still growing, a significant chunk of that growth is simply due to price increases.
Disney's stock has declined by more than 40% in five years, and I wouldn't be surprised if it incurs even greater declines in the future. With too many question marks around the business, this is a stock I'd avoid right now, as it looks to be on the same path as Nike.
Because of its unrivaled intellectual property, spanning endless characters, franchises, and storylines, Walt Disney (DIS +0.85%) is a dominant force in the world of entertainment that has a competitive position rivals can't replicate. This standing hasn't always worked out for investors. But the trend has been positive in the past six months.
If you invested $1,000 in this consumer discretionary stock at its 52-week low price of $92.19, which was established in late March, this is how much you'd have today.
Image source: The Motley Fool.
Since that low, Disney shares have climbed 14% (as of Sept. 30). That's an encouraging return for a half-year period. A $1,000 sum would be worth $1,140 today.
Despite momentum being on its side, this stock is still trading significantly below its all-time record from March 2021. Shares are 48% off that peak.
Premium Feature
Moneyball Superscore
74/100
Today's Change
(
0.85
%) $
0.86
Current Price
$
102.19
Disney makes for an interesting buying opportunity today. The stock is cheap. The market is offering the business to investors at a forward price-to-earnings ratio of just 13.8. It's challenging to find competitively advantaged companies at low valuation multiples like this.
While Disney continues to navigate the secular decline of cable TV, the streaming segment is performing well. Its operating income is surging.
There's always the Experiences division, home to Disney's prized theme parks and cruise lines. An uncertain economic backdrop isn't getting in the way of strong revenue and profit gains here.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walt Disney. The Motley Fool has a disclosure policy.
, /PRNewswire/ -- Disney Experiences is inviting New Yorkers to discover the magic of Disney's Lakeshore Lodge through an expansive 3D street mural in Flatiron Plaza.
Disney Experiences is inviting New Yorkers to discover the magic of Disney’s Lakeshore Lodge through an expansive 3D street mural in Flatiron Plaza. WHAT: Disney's Lakeshore Lodge, the newest resort hotel coming to Walt Disney World will celebrate the beauty of nature as seen through the eyes of Disney artists and storytellers. Street artist Tracy Lee Stum has created a preview of this serene retreat through a 3D mural inspired by Daydream River, the resort's blissful lazy river. Guests can step into this eye-catching sidewalk image to capture photos and video of themselves enjoying one of the resort's relaxing signature experiences.
WHEN: Today, Oct. 2 from 10:00 a.m. to 5:00 p.m.
WHERE: The corner of 23rd Street and 5th Avenue in Manhattan
THE ARTIST: The installation is created by acclaimed American street muralist Tracy Lee Stum, known for her colorful, interactive 3D chalk art. Stum has received numerous awards and accolades for her work around the globe, including a 2006 Guinness World Record for the largest chalk painting by an individual.
ASSETS: If you have a Brandfolder account, you can download assets here. If you need to register for Brandfolder, please click here.
ABOUT DISNEY'S LAKESHORE LODGE
Opening July 1, 2027, Disney's Lakeshore Lodge will be a waterfront retreat along the shores of Bay Lake, celebrating the beauty and magic of nature through the artistry of Disney storytelling. Inspired by Walt Disney's lifelong admiration for the great outdoors, the resort will draw from decades of Disney Animation stories rooted in nature, with design influences from "Bambi," "Pocahontas," "Encanto," "Brother Bear" and more.
Across 967 thoughtfully designed rooms, guests can enjoy accommodations ranging from intimate studios and spacious villas to new one- and two-bedroom waterfront Lake Houses, with natural materials, earthy color palettes and original artwork from classic Disney films set in the great outdoors. Beyond its deluxe accommodations, guests can reconnect with nature through distinct dining venues, whimsical recreational offerings and unique amenities, all just a boat ride away from Magic Kingdom Park.
Disney Vacation Club Members will have first access to reservations for Disney's Lakeshore Lodge beginning Oct. 6 by contacting Member Services at (800) 800-9800. Walt Disney World Annual Passholders will be able to book reservations beginning Oct. 7 by contacting (407) 934-7639. Reservations will open to all guests on Oct. 8 online, by calling (407) 934-7639 or through their travel agent.
For more information about Disney's Lakeshore Lodge, visit:
https://disneyparksblog.com/wdw/lakeshore-lodge-disney-world-updates/
Item 1 of 2 The Ice Age's Scrat and his Acorn balloon are carried during the 91st Macy's Thanksgiving Day Parade in New York, New York, U.S., November 23, 2017. REUTERS/Carlo Allegri
[1/2]The Ice Age's Scrat and his Acorn balloon are carried during the 91st Macy's Thanksgiving Day Parade in New York, New York, U.S., November 23, 2017. REUTERS/Carlo Allegri Purchase Licensing Rights, opens new tab
Oct 2 (Reuters) - Disney (DIS.N), opens new tab agreed to license a slate of movies and TV shows to Netflix (NFLX.O), opens new tab, including existing "Ice Age" films as well as "Percy Jackson and the Olympians" and "Will Trent" series, the companies said on Friday.
Here are some more details:
Sign up here.
The deal expands Netflix's access to Disney-owned content as the streaming platform broadens its library through licensing agreements, including a deal with AMC Global Media (AMCX.O), opens new tab in July to bring "The Walking Dead" series to its platform.
The first two seasons of Disney+ original series "Percy Jackson and the Olympians" will be available globally on Netflix from October 4 for three months.
The five "Ice Age" films will also begin streaming globally on Netflix for three months, ahead of the theatrical release of "Ice Age: Boiling Point" early next year.
The deal also includes a selection of Disney and Pixar films, including "Soul", "Elio" and "Raya and the Last Dragon", which will be available globally on Netflix from early 2027, with varying launch dates and regions.
Disney-branded titles largely remain exclusive to its streaming platforms and TV channels, as per the company.
Reporting by Akash Sriram and Angela Christy in Bengaluru; Editing by Vijay Kishore
Our Standards: The Thomson Reuters Trust Principles., opens new tab
You are now leaving Barron's websiteBy clicking on the “Proceed” button below, you will be redirected to a third-party website owned and operated by Hong Kong Tiimoot Information Technology Co., Limited. (“HKT”), which is located in Hong Kong. That website operates independently from Barron's and Barron's does not control the website. The privacy practices of HKT are subject to its Privacy Statement, so please read it closely. We are not responsible for HKT's privacy or other data-related practices.
Walt Disney Co (NYSE:DIS, XETRA:WDP) is laying off around 300 employees under CEO Josh D'Amaro as it cuts costs to invest in growth, according to a person familiar with the matter.
The latest reductions mainly affect human resources and technology roles, the person said, speaking anonymously because they were not authorized to comment publicly.
Deadline first reported the latest layoffs, part of a series of workforce reductions since D'Amaro replaced Bob Iger in March.
In April, Disney planned to eliminate as many as 1,000 roles as D'Amaro consolidated the enterprise marketing division, CNBC reported at the time.
Further cuts in July reduced the workforce by several hundred across corporate functions and businesses including Pixar, ESPN, Disney Entertainment Television and the studios, according to media reports.
Most of those July layoffs occurred within Pixar and National Geographic.
By August, Disney flagged possible reductions in labor and selling, general and administrative expenses in its earnings report as it evaluated ways to cut costs.
"Those savings were intended "to create incremental capacity to invest for growth," Disney wrote, adding that it would provide future updates on progress.
Around the same time, Disney also began offering early-retirement buyout packages to longtime executives.
The cost-cutting push comes as Disney adapts to streaming and digital entertainment, with D'Amaro's "One Disney" strategy aiming to align divisions and integrate compatible businesses.
That strategy seeks to connect Disney's intellectual property across film, streaming, theme parks, consumer goods, gaming, and sports, D'Amaro has said.
Shares of The Walt Disney Co. (NYSE:DIS) are trading flat Friday morning, stabilizing after dropping Thursday amid reports of additional workforce reductions across its core corporate divisions. Here’s what investors need to know.
Walt Disney shares are consolidating. What should traders watch with DIS? Headcount Reductions and Restructuring InitiativesReports indicated that Disney plans to cut several hundred jobs spanning its human resources and technology operations. The headcount reductions follow notable executive leadership turnover under Chief Executive Officer Josh D’Amaro, who assumed the top role in March.
The latest cuts build upon prior organizational streamlining, including approximately 1,000 role eliminations in April and 7,000 position cuts executed in 2023 under former Chief Executive Officer Bob Iger as part of a $5.5 billion cost-reduction program.
Wall Street Outlook and Fourth-Quarter PreviewAnalysts have released updated outlooks ahead of Disney’s fiscal fourth-quarter financial report scheduled for November 12.
BofA Securities analyst Jessica Reif Ehrlich reaffirmed a Buy rating and $125 price target, citing resilient theme park attendance and new cruise ship deployments, even as theatrical box office softness weighs on Entertainment results.
Ehrlich projected fiscal 2027 revenue of $105 billion and earnings of $7.52 per share, while raising her operating income estimate to $20.8 billion. Broader Wall Street consensus remains a Buy with an average price target of $126 across 24 tracking analysts.
DIS Stock Pauses Friday MorningDIS Price Action: Walt Disney shares were up 0.42% at $101.76 during premarket trading on Friday, according to Benzinga Pro data.
Read Next
Image: Shutterstock
Market News and Data brought to you by Benzinga APIs
