Disney+ profit doubles as ESPN integration advances
August 6, 2026 13.06 Europe/London By Julian Clover


Disney’s streaming business more than doubled operating income in its fiscal third quarter, as higher subscription revenue and subscriber growth helped offset a softer advertising market.

Entertainment SVOD revenue, covering Disney+, Hulu SVOD and related streaming services, increased 11% year-on-year to $5.53 billion. Operating income rose to $712 million from $329 million, giving the business a 13% operating margin. Subscription fees were up 15%, driven mainly by subscriber growth and higher effective rates, while advertising revenue rose 3% as higher impressions offset lower pricing.

Disney said it remains on course for double-digit full-year Entertainment SVOD margins in fiscal 2026, excluding the impact of an extra reporting week.

CEO Josh D’Amaro described Disney+ as the “digital centrepiece” of the company’s strategy. The group said it had reached an important milestone in app unification, allowing Hulu standalone and bundle subscribers to link profiles, watch history and manage subscriptions on Disney+. Disney is also adding autoplay video to the homepage and expanding Disney+ Verts through a new TikTok agreement that will bring curated fan-created short-form content into the service.

International programming is also being increased. Disney said it plans to roughly triple the number of local original series on Disney+ over the next three years to attract users outside the United States and reduce churn. It cited Rivals season two as Disney+’s biggest EMEA original premiere in the UK and Ireland.

Sports remains central to the platform strategy. Disney said it would bring a more substantial selection of ESPN games to Disney+ in the United States from this autumn, including additional college football simulcasts and College GameDay. ESPN is also building what Disney calls a “marketplace of sports”, with relationships including the NFL, MLB, Fox One and The CW Network. More than 800 annual hours of CW Sports will stream live on the ESPN app for ESPN Unlimited subscribers.

The Sports segment itself was mixed. Revenue rose 4% to $4.5 billion, but operating income fell 17% to $858 million, reflecting higher programming and production costs, NBA rights timing, early-round NBA playoff sweeps and a network carriage dispute. Even so, Disney said NBA and NHL championship ratings on ABC and ESPN more than doubled year-on-year, and that ESPN, ESPN2 and ESPN on ABC had their most-watched fiscal Q3 since 2016.

The quarter also underlined Disney’s retreat from non-core linear assets. The company has agreed to sell its 50% stake in A+E Global Media to Hearst for around $1.2 billion.