Analyst Note| Neil Macker, CFA |
Disney posted a strong fiscal-year 2021 third quarter as revenue just beat FactSet consensus and EBITDA came in well ahead of expectations. Disney+ added 12.4 million customers to end the quarter at 116 million subscribers due in part to the return of cricket, still below the 21 million added in the fiscal first quarter but well ahead the 8 million in the second quarter. While subscriber growth has slowed down, we still expect robust long-term subscriber growth, particularly outside the U.S. as the firm continues to add more original content and increase the library depth in the Star sub brand. We maintain our wide moat and raise our fair value estimate to $170 from $154 due to the lower-than-expected streaming losses and stronger subscriber growth.