Fast Money Blog- 8/9/24

This week on Wall Street was highly volatile and saw both Disney and Uber release their earnings results on Tuesday, August 6th.

The Walt Disney Company (DIS) posted top line revenue for Q3 2024 of $23.1 billion, up 4% from a year earlier.

The bright spot for Disney was their Entertainment revenue, which includes Linear Networks, Direct-to-Consumer (streaming services) and Content Sales/Licensings. Revenue for this segment was $10.58 billion, up4% for the quarter year-over-year. This increase was largely due to subscription revenue growth, which was caused by price increases, and customer growth for Disney+ Core.

Entertainment Revenue Details You Need to Know 

Direct-to-Consumer (streaming) revenue was up 15%, to $5.8 billion, with their combined streaming services of Disney+, Hulu and ESPN turning a profit for the very first time. The combined streaming business posted an operating profit of $47 million compared with a loss of $512 million in the same quarter last year. 

However, this is a bit misleading, because without ESPN+, the direct-to-consumer streaming unit reported a loss of $19 million.  

Although Disney’s Content sales, Licensing and other revenue, which includes Disney’s box office revenue, was down 4% in the quarter year-over-year, they did see an operating profit of $254 million compared to a loss of $112 million from the same quarter last year. This profit was due to the strong performance of Inside Out 2.

Disney Parks Disappoint

The most troubling news for Disney came from its theme parks segment, which was impacted by inflation and slowing consumer demand. Disney did state that they foresee flat attendance at U.S. parks continuing over the next few quarters. 

Although quarterly revenue for the overall experiences unit, which includes domestic and international parks and experiences, as well as consumer products, was up 2% to $8.386 billion, operating income for U.S. parks was down 6%.

While I respect Disney for its legacy I can not recommend Disney stock as a short term trade or long-term hold.

Up Next is Uber

Uber Technologies, Inc. (UBER) reported their Q2 2024 earnings, with top-line revenue of $10.7 billion, up 16% year-over-year, the fastest pace in five quarters. 

The number of Uber’s monthly active platform consumers reached 156 million in its second quarter, up almost 14% year-over-year.

Moreover, there were 2.77 billion trips completed on the platform during the period, up over 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 19% from a year ago, to $40 billion.  

This is all good news.

I would recommend Uber for a long-term hold but make sure it's no more than 5% of your total portfolio. 

Overall we saw a lot of volatility this week and I expect it to continue over the next 30 days. 

Stay positive and stay disciplined. 

Tyrone Jackson, The Wealthy Investor