CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved.

Disney shares Q2 earnings preview: analysts predict revenue will fall 11.8%

The Disney share price has dropped as analysts predict its forthcoming Q2 report will a show year-on-year loss of almost $3 billion. However, with streaming surging and life returning to normal, Disney shares have some potential.

  • Disney Q2 earnings expected to drop 11.8% to $15.87 billion.
  • Earnings per share predicted to decrease 12.5%.
  • Streaming services may help Disney shares recover.
  • Ready to trade the Disney share price? Open an account today

Shares in Disney have dropped 2.8% since Monday as the company prepares to announce its Q2 2021 results. However, even with a 12 May closing price of $177.85 - the lowest since February - the overall picture is better than it was.

On 13 May 2020, the Disney share price was $102.92 as the company struggled to cope with the pressures brought on by Covid-19 restrictions. Some of these pressures remain but, as Disney’s Q2 earnings report is expected to show later today, they’re easing.

What will the Disney Q2 earnings report show?

The consensus among analysts surveyed by Reuters is that Disney’s earnings for Q2 will be $15.87 billion. That would be down 2.3% on the $16.25 billion it reported in Q1. Moreover, it would represent a year-on-year drop of 11.8% from 2020’s $18 billion in Q2 revenue.

Based on the current consensus estimate, Disney’s adjusted earnings per share (EPS) is expected to be $0.28 with a diluted EPS of $0.01. That would constitute a drop of 12.5%. These losses are significant but the rate at which they’re occurring is starting to slow.

Covid-19 restrictions remain a problem for the company’s theme parks, cruise ships and retail outlets. However, with vaccinations unlocking large parts of North America and Europe, the pressure is easing.

Which metric will analysts be focused on?

The main focus of Disney’s Q2 FY 2021 earnings report will be its digital services. The number of Disney+ subscribers will be the key metric. Previous figures show that the streaming platform had just over 90 million subscribers at the end of 2020. Recent reports show that, as of March 2021, it has over 100 million.

That’s still less than the 208 million subscribers Netflix has. However, the signs are that Disney+ is closing the gap faster than expected. Netflix’s recent earnings report showed that it added 4 million paid subscribers in Q1 2021. That was 2 million below expectations and, looking forward, the current estimates suggest Netflix will add just 1 million more subscribers in Q2.

If Disney’s earnings report shows an increase of more than 5 million subscribers, it will be growing at a faster rate than one of its main rivals. That could be a positive for Disney shares in the coming months.

A return to normality for Disney resorts will be a point of interest for analysts and traders. However, with restrictions and regulations differing around the world, there may not be much certainty in this area of the business. This could add extra credence to the growth of Disney+ and its potential impact both on the company’s recent earnings and its future share price.

Can streaming help the Disney share price recover?

Take your position on US shares for just a small initial deposit with CFDs.

Whether you trade or invest, you’ll get access to pre-market and after-hours trading on 70 US stocks.

Open an account to get started.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.