Disney’s Dividend Boost and Buyback Plan: A Streaming and Parks Success Story
The media giant, Disney, has announced a significant boost in its dividend and share buyback plan for fiscal 2026, driven by the success of its streaming and parks businesses. This move comes as a response to the company’s efforts to adapt to the industry-wide decline of traditional broadcast and cable TV.
Despite a 3% decline in adjusted earnings per share for the fourth quarter ending in September, Disney’s streaming unit saw a remarkable 39% profit surge to $352 million. This growth is attributed to the addition of 12.5 million subscribers to Disney+ and Hulu, bringing the total to 196 million. A new distribution deal with Charter Communications helped attract new streaming customers, and the box office success of ‘Lilo & Stitch’ on Disney+ further boosted its popularity.
The theme parks unit also performed well, with a 13% increase in operating income to $1.88 billion. This growth is partially due to the expansion of the U.S. cruise ship business and the success of Disneyland Paris. However, the traditional TV unit’s profit declined by 21%, and ESPN’s income slipped, reflecting the ongoing decline in television fees and advertising revenue.
CEO Bob Iger’s aggressive cost-cutting measures, implemented since his return to Disney in 2022, have contributed to the company’s financial stability. Disney’s board has declared a dividend of $1.50 per share, up from $1 a share, and doubled its stock buyback to $7 billion in fiscal 2026. Despite the overall revenue missing market expectations, Disney projects double-digit adjusted EPS growth for both fiscal 2026 and 2027, showcasing its confidence in the future.
This strategic shift towards streaming and parks has positioned Disney to capitalize on the changing media landscape, and the company’s commitment to innovation and adaptation is a key factor in its continued success.