Fast Money Blog- 5/10/24
This week on Wall Street was mostly dominated by both Disney and Uber earnings releases.
On Tuesday, May 7th, The Walt Disney Company (DIS) posted top line revenue for Q2 2024 of $22.08 billion, up 1% from a year earlier.
All eyes were on Disney’s Entertainment revenue, which includes Linear Networks, Direct-to-Consumer (streaming services) and Content Sales/Licensings. Revenue for this segment was down 5% for the quarter year-over-year.
Entertainment Revenue Details You Need to Know
Linear network revenue across Disney’s portfolio, excluding ESPN, fell 8% to $2.77 billion. This includes revenue from Disney's cable channels such as ESPN, Disney Channel, Disney Junior, FX, and National Geographic and broadcast channels such as ABC.
Direct-to-Consumer (streaming) revenue was up 13%, to $5.6 billion. Although Disney+ and Hulu turned a profit in the quarter for the first time, together with ESPN, Disney’s three streaming services still lost $18 million in the quarter.
In addition, Content sales, Licensing and other revenue, which includes Disney’s box office revenue, fell 40% in the quarter to $1.39 billion
So Tyrone, What Does All of This Mean?
The bottom line is that Disney is struggling to turn a profit on its streaming services, just like other entertainment giants such as NBCUniversal, Warner Bros. Discovery and Paramount Global.
Plus because fewer people are paying for cable hookups, Disney is making less revenue in its traditional television business.
At this time I can not recommend Disney stock as a short term trade or long-term hold.
Up next is Uber
Pay close attention to the below highlights because there is a bit of complexity to them.
On Wednesday, May 8th, Uber Technologies, Inc. (UBER) reported their Q1 2024 earnings, with top-line revenue of $10.1 billion, up 15% year-over-year and up 2% from last quarter.
The number of Uber’s monthly active platform consumers reached 149 million in its first quarter, up 15% year-over-year.
Moreover, there were 2.6 billion trips completed on the platform during the period, up 21% year-over-year.
Uber’s gross bookings, which is the amount of money Uber collects from a ride, meal delivery or freight shipment, rose 20% from a year ago, to $37.7 billion.
In other news, the company announced on Tuesday that it would partner with Instacart, allowing users of the grocery delivery app to order from restaurants through Uber Eats.
This is all good news.
However, the company’s net loss widened to $654 million from a loss of only $157 million, in the same quarter last year.
In addition, Uber’s freight business booked $1.28 billion in sales for the quarter, a decrease of 8% year over year and flat quarter over quarter.
Currently Uber stock is off its 52-week high by around $15.
Because Uber is still an emerging technology company, you should NOT disproportionally trade Uber because of its cheap share price.
Let me remind you that overall, Q2 2024 earnings releases for our favorite Wealthy Investor stocks have all been outstanding.
Over the next 90 days, I see a lot of profits to be earned from covered calls and volatility trading.
Tyrone Jackson, The Wealthy Investor