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Disney earnings — What to know in markets Thursday

Heidi Chung

Media powerhouse Disney (DIS) will take centerstage Thursday when it reports fiscal-fourth results.

After much anticipation, Disney’s over-the-top streaming service Disney+ is gearing up to launch Tuesday. The service will cost $6.99 per month or $69.99 per year. Rival Netflix (NFLX) costs $8.99 to $15.99 per month.

The streaming wars are officially running hot with Apple TV+ already available and HBO Max getting ready to hit the public in May 2020.

In an attempt to lure in customers, Disney announced a partnership with Verizon (VZ) in late October. Verizon (Yahoo Finance’s parent company) will be giving existing and new customers one year of Disney+ for free. Similarly, Apple announced in September that customers who purchase new Apple devices will get Apple TV+ for free fo a year.

Analysts are anticipating a challenging quarter for Disney, specifically in its media networks division. Operating income in that division is estimated to have fallen 10%. Meanwhile, Disney’s film unit will have likely gotten a strong boost over the quarter as ticket sales are estimated to have surged 74% thanks in part to “The Lion King.” Disney’s parks segment is also expected to have performed well during the quarter.

DANCING WITH THE STARS - "Disney Night" - There will be Disney magic in the ballroom as nine celebrity and pro-dancer couples compete on the fifth week of the 2019 season of "Dancing with the Stars," live, MONDAY, OCT. 14 (8:00-10:00 p.m. EDT), on ABC. (Kelsey McNeal/ABC via Getty Images) GOOFY, MICKEY MOUSE, MINNIE MOUSE, TWEEDLEDEE, DONALD DUCK
Disney characters. (Kelsey McNeal/ABC via Getty Images)

Disney’s third quarter results follow a tough second quarter. The company missed Wall Street estimates on both the top and bottom lines as costs rose ahead of the launch of Disney+.

“We feel that we can focus more on quality than on quantity,” Iger said during a call with investors August 6. “If you compare us to Netflix, we’re going to have far less products than they do, but we’re relying on the strength of our brands and the fervor that fans of those have for the products that we make under those brand umbrellas.”

Disney is expected to report fiscal fourth quarter adjusted earnings of 96 cents per share on $19.03 billion in revenue, according to analysts surveyed by Bloomberg.

Shares of the media behemoth have risen 20% this year and have underperformed the broader market’s 24% gain in the same time period. The options market is implying a 4.36% move in either direction for the stock following the earnings announcement.

Other notable earnings reports scheduled for Thursday include Ralph Lauren (RL) before market open; Activision Blizzard (ATVI), Zillow Group (ZG), Lions Gate (LGF-A), Take-Two Interactive (TTWO), Booking Holdings (BKNG) after market close.

Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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