Disney smashes streaming subscriber expectations

CNBC's Fast Money
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Automatic TRANSCRIPT

We start off with disney delivering in its latest company smashing streaming expectations the stock higher in the after hours session. Let's get straight to julie abortion. Who is fresh off that disney call julia. Melissa earnings call underway right now. The stock up nearly three percent after the company exceeded expert expectations on the top line in reported a profit rather than the loss analysts anticipated. Now the two key areas in focus parks and streaming both outperformed expectations disney's streaming business outpaced projections going to ninety five million disney plus subscribers and one hundred and forty six million total direct. To consumer customer is now that includes hulu and espn plus that division grew revenue seventy three percent from the year earlier quarter especially pleased with the success of our correct. The consumer business and our recent strategic reorganization has enabled us to accelerate. The company. Said it was a dc first business model and further grow our streaming services disney plus has exceeded even our highest expectations. Meanwhile the parts visions revenue dropped less than anticipated down by fifty three percent the company announcing that covert has headed two point six billion dollar impact on the parks divisions operating income as a result of closures and reduced capacities. Where we've been able to reopen are with limited capacity guest have consistently demonstrated a willingness and a desire to visit which we believe is a testament to the fact that they feel confident. In the health and safety protocols we've put in place average daily attendance at walt disney world significantly from q for q one japex saying they're continuing to invest to build out different features of their parks and they said they are very pleased with the reservations and consumer interest in visiting parks. Melissa of course that's going to be in focus as they start to get to be able to increase their capacity in florida and are allowed to open up here in california. All right julia. Thank you julie. Borsen the latest on disney. Which is up three percent after hours. Dia dommie how do you like the stock. How do you like what they said on this. Call well kudos again. I mentioned the last night sort of took a pass on the kudos. I'll give it to her anyway. And tim who've been all over this and so listen. I'm not a huge fan of treadmills and this is going somewhere. Mel by the way suggest indulge me for a second but you get on a treadmill. You go eight miles an hour maybe walk. Maybe put down your honor for forty five minutes but when you get off your exactly where you started and i bring that up because listen. It's great that they keep adding people to disney plus i get it but as rich greenfield amongst. Many others pointed out our food down twenty-eight percent every year i'll tell you what that means because that's the game we play here but effectively a lot of ways that running in place. Now the naysayers will say. That's a bad thing. That's going to lead to decline in stock. And the optimists will say they're going to be able to monetize all those people there all by drew barrymore short with the delorean on it and those types of thing and maybe they'll go mr toad wild ride when the parks reopened. I'm not nearly as optimistic. So it's not a great ride valuations now or at levels where i don't think it necessarily should be okay and then it pick up on that point because i also read that tweet so this past quarter the arp average revenue per user was four dollars and three cents for disney plus and a year ago is five dollars and fifty six cents. Tim should we not care about this at this early stage of growth for disney for the streaming service. I don't think so. I mean i no. I don't think so. And i think you know guy may be like george jetson on the treadmill. I avoid treadmills i. I'd rather be out there and disney's running through the streets right now with with ninety five million and essentially when you add in hulu and espn plus. We heard those numbers. This strategic reorganization is part of the excitement. Here again. this division is up. Seventy three percent during a period when netflix is been in a sweet spot of engaged in couldn't be in a better position disney's outperform the stocks outperform disney from net flicks by almost forty percent since since august. But even over the last couple of years it's outperformed net flicks which we would all certainly agree is also making a move especially in terms of profitability. But again do we care about that. With netflix's should we care about that with disney when also they're showing that they can at least be profitable and their core business through very difficult times on the way out of kobe. So look i understand the profitability issues. At some point disney's got to create their own content. We know that's very expensive. But if you're asking me you know from from an investor's perspective. Am i happy with with the metrics that are driving the stock to move higher and thirty nine times five bucks. A share of two thousand and twenty two is is not expensive when you consider what is being paid for net flicks.

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