Disney ( DIS ) reported its entire streaming division turned a profit for the first time on Wednesday, but weakness in its parks division hurt an overall strong report, with the company pointing to “moderating consumer demand” toward the end of the quarter.
In its third-quarter results, Disney said its direct-to-consumer streaming business, which includes Disney+, Hulu and ESPN+, posted an operating profit of $47 million, compared with a loss of $512 million in the same period last year. The company had previously expected its streaming business as a whole to be profitable by the current quarter.
Overall, the company reported adjusted earnings per share of $1.39 for the third quarter, beating the $1.19 expected by analysts surveyed by Bloomberg and up from the $1.03 Disney reported in the same period a year ago.
Revenue was $23.2 billion, beating market expectations of $23.1 billion and up from $22.3 billion in the same period last year.
Disney also raised its full-year adjusted profit growth outlook to 30% from 25% previously.
Disney shares rose 3% in premarket trading on Wednesday before giving up the gains. As of the filing, Disney shares were roughly flat this year.
Looking ahead, Disney said it expects streaming profitability to improve in the fourth quarter, with both DTC Entertainment (which posted a $19 million loss in the third quarter) and ESPN+ expected to be profitable.
“We have multiple fundamentals in place to improve margins over the next few years and remain optimistic about our trajectory,” the company said in a statement.
One of the cornerstones of this will be new price hikes for those services: The company announced on Tuesday that it is raising prices across its Disney+ and Hulu plans again, with the changes set to take effect in October.
For Disney, the biggest disappointment of the quarter was its theme parks business, where domestic operating profit fell 6% year over year to $1.35 billion, and the company warned that slowing demand could continue for “several quarters to come.”
The company added that Disneyland Paris would be affected by a decline in normal consumer demand due to the Olympics and a weakening economic cycle in China. The company said demand for cruises remained “robust.”
For more details on the results, please click here.