Disney stock (NYSE:DIS) has struggled to reward investors in recent years, losing over 40% of its market capitalization. Bob Iger’s return as CEO in late 2022 brought hope, and his strategic initiatives improved profitability across several divisions. Now, with Josh D’Amaro set to take over as CEO, investors are watching closely to see whether Disney can finally translate operational success into sustained stock growth.
Streaming Turns Profitable Under Iger
One of Iger’s most significant moves was reshaping Disney’s streaming strategy. By focusing on profitability rather than pure subscriber growth, Disney’s streaming segment posted an operating profit of $450 million in fiscal Q1 2026, representing an 8.4% margin. For the full year, Disney expects a 10% operating margin in streaming, a remarkable turnaround from a nearly $1.5 billion operating loss in fiscal Q4 2022 under Bob Chapek.
Theme Parks and Experiences Reach Milestones
Disney’s Experiences segment, which includes theme parks and resorts, achieved revenues exceeding $10 billion in the most recent quarter, marking a record milestone. This division has historically been a major profit driver, and under Iger, management focused on guest satisfaction and multi-year investments to enhance park experiences. The improvements are intended to strengthen Disney’s “flywheel,” where positive guest experiences drive attendance, merchandise sales, and overall brand loyalty.
Box Office and Content Performance
Disney also showed better results in its film division. The company led the box office in both 2024 and 2025, which not only boosts revenue from theatrical releases but also enhances the value of its intellectual property (IP) across merchandise, theme parks, and streaming. Disney’s extensive content library remains a critical competitive advantage in the streaming wars, particularly as rival companies like Netflix (NASDAQ:NFLX) and Paramount Skydance (NASDAQ:PSKY) demonstrate the market value of high-quality IP, exemplified by the bidding for Warner Bros. Discovery (NASDAQ:WBD) assets.
Financial Performance Under Iger
Disney’s consolidated financials improved under Iger. Fiscal Q1 2026 revenue reached $26 billion, up from $23.5 billion in fiscal Q1 2023, the first quarter under Iger. Adjusted EPS rose sharply from $0.99 to $1.63 during the same period, reflecting the company’s pivot toward profitable growth. Despite these gains, Disney’s stock price has remained largely flat, underperforming broader markets and leaving the stock trading at a forward P/E of 16.4 times, below the S&P 500 average.
Why Disney Stock Has Stalled
While operational improvements are clear, Disney’s market performance has lagged. Investor sentiment has not fully reflected the earnings growth under Iger. The divergence between fundamentals and stock price has left Disney stock trading at a relative discount, presenting a complex scenario for long-term shareholders. The market seems to be factoring in uncertainties about growth sustainability, competition in streaming, and potential execution risks under new leadership.
The Outlook With D’Amaro
Josh D’Amaro inherits a stronger Disney. The company’s streaming operations are profitable, theme parks are thriving, and content production continues to deliver global hits. How D’Amaro approaches strategic decisions—particularly in integrating new technologies, expanding international growth, and leveraging Disney’s vast IP—will be critical to whether the stock price finally begins to reflect underlying business strength. Investors will be closely watching for any pivot in strategy or operational focus under his leadership.
Should Investors Buy or Sell Disney Stock?
Disney’s massive IP portfolio and diversified revenue streams make it a compelling long-term story. Box office success drives theme park attendance and merchandise sales, while its content library enhances streaming prospects. However, the stock has underperformed, and the recent selloff has created opportunities in other tech and entertainment stocks with potentially better risk-reward ratios. Long-term investors may remain constructive, but near-term performance will hinge on D’Amaro’s execution.
Conclusion
Disney (NYSE:DIS) is entering a new era with Josh D’Amaro at the helm. The company’s improved earnings, profitable streaming, and thriving theme parks set the stage for potential stock appreciation, but investor patience may be required. How effectively D’Amaro leverages Disney’s IP and drives sustainable growth will likely determine whether Disney stock finally overcomes its long-standing underperformance.
Featured Image: Megapixl
