Disney Traditional Media Cracks as Streaming Bets on NFL to Reverse Decline

TradingKey - Disney(DIS) reported better-than-expected Q3 2025 fiscal results before Wednesday’s market open, though traditional television and film businesses continued to weigh on performance. Shares closed down 2.66% at $115.17, marking a 6.49% decline over the past month.

Disney stock; Source: TradingKey

Financial results showed Disney’s traditional television networks segment (including ABC and National Geographic channels) generated $2.27 billion in revenue, down 15% year-over-year. Operating profit fell more sharply by 28% to $697 million.

Meanwhile, the segment encompassing film studios posted a $21 million loss, primarily due to underwhelming box office performances from Pixar’s new animated film Elio and Marvel Studios’ Thunderbolts.

“Despite improvement over the last year, performance of this segment has gone backwards over the course of this calendar year,” analysts led by Kannan Venkateshar wrote. The segment needs to perform more consistently in order for the stock to improve.

To address structural contraction in traditional media, Disney implemented hundreds of layoffs in June across its film and television divisions, affecting roles in marketing, casting, and finance.

As the traditional TV business declines, Disney has placed its growth bet on sports-driven streaming services, particularly building direct-to-consumer (DTC) platforms around its flagship ESPN brand.

Disney’s streaming segment turned profitable for the first time, with Disney+ global subscriptions growing to 128 million.

On Tuesday, Disney announced a new agreement with the National Football League (NFL). Under the deal, the NFL will sell most of its media assets—including the NFL Network channel and popular NFL RedZone service—to Disney. In exchange, the NFL will receive a 10% equity stake in ESPN.

The transaction is expected to close by the end of 2026. Upon completion, Disney will retain 72% ownership of ESPN, Hearst Communications will hold 18%, and the NFL will own 10%.

Disney also announced its flagship sports streaming product—the new ESPN streaming app—will launch on August 21 at a monthly subscription price of $30. The service will feature both traditional ESPN TV channel content and innovative interactive features.

CEO Bob Iger stated the company is taking "an important step in the streaming landscape" and remains committed to building a "truly differentiated streaming proposition."