Disney stock (NYSE:DIS) recently experienced volatility following its fiscal Q4 2025 earnings, falling nearly 8% and dipping below its 200-day moving average. While the stock has underperformed the S&P 500 ($SPX) in three of the last four years, investors are now closely watching whether 2026 will bring a turnaround.
This article talks about Disney stock’s recent performance, the key drivers behind its business segments, and the prospects for 2026, providing investors with insights to make informed decisions.
Mixed Q4 Earnings for Disney Stock
Disney reported revenues of $22.46 billion for Q4, slightly below last year’s comparable quarter and short of analyst estimates of $22.75 billion. Adjusted earnings per share (EPS) fell 3% to $1.11 but still exceeded Street expectations.
The company faced tougher comparisons due to a stronger theatrical slate last year and political advertising ahead of the 2024 U.S. presidential elections. Even initiatives such as dividend and share buyback increases failed to lift market sentiment immediately.
Disney’s Three Core Business Segments
Disney’s earnings reveal the continuing story of three moving parts: theme parks, streaming, and movies.
1. Experiences / Theme Parks
Disney’s parks continue to perform strongly. Both domestic and international locations are seeing growth in bookings and average guest spending, acting as a key cash flow engine for Disney stock.
2. Streaming
Disney+ and other streaming services generated $352 million in operating income in Q4, totaling $1.3 billion for the full fiscal year. This marks a significant turnaround from the $4 billion annual loss before Bob Iger returned as CEO in late 2022. Streaming continues to support subscriber growth and contributes to recurring revenue, which bolsters investor confidence in Disney stock.
3. Movie Franchises
The performance of Disney’s movie slate has been inconsistent. While releases like Moana 2 and Inside Out 2 drove box office success in 2024, titles such as Snow White and Tron: Ares underperformed this year. Popular films are crucial, not only for box office revenue but also for enriching Disney’s streaming content and driving traffic to its parks.
Key Drivers for Disney Stock in 2026
Looking ahead, Disney stock could benefit from several factors:
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Strong Movie Slate: Upcoming releases such as Avatar: Fire and Ash, Toy Story 5, and live-action Moana are expected to attract significant box office and streaming engagement.
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Theme Park Performance: Despite macroeconomic pressures, Disney parks continue to show resilience, even with competition from Comcast’s Epic Universe in Florida.
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Streaming Growth: Disney+ margins are expected to improve, sustaining profitability and long-term subscriber growth.
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Forward Guidance: Disney projects double-digit earnings growth in fiscal 2026, though early-year comparisons remain challenging.
Risks Facing Disney Stock
Despite these positives, Disney stock faces headwinds:
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Linear TV Decline: Traditional broadcasting continues to weigh on overall earnings.
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CEO Succession: Bob Iger plans to step down after his contract expires, introducing leadership transition risks.
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AI Challenges: Emerging AI technologies may threaten intellectual property and content protection.
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Short-Term Operational Issues: Partnerships, such as the YouTube collaboration, require careful management.
Disney Stock Remains a Compelling Buy
At a forward price-to-earnings multiple of 17.7x, Disney stock offers a favorable risk-reward profile. For long-term investors, the combination of parks, streaming growth, and strategic content investments makes NYSE:DIS a compelling option for potential double-digit returns in 2026, barring a broad market downturn.
Conclusion
Disney stock’s mixed Q4 earnings highlight both challenges and opportunities. Theme parks, streaming, and a strong upcoming movie slate are key drivers supporting growth, while Linear TV decline and succession planning present risks.
Investors looking at Disney stock should weigh these factors carefully, but the outlook for 2026 remains positive. With robust recurring revenue streams and continued investments in content and experiences, NYSE:DIS appears well-positioned for growth.
Featured Image: Pixabay © Mirco
Author Stephanie Bédard-Châteauneuf 
