filings.toolsItem 1. Financial Statements
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Item 1. Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited; in millions, except per share data)
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Services | $ | 22,684 | $ | 21,258 | $ | 45,890 | $ | 43,306 | |||||||||||||||
| Products | 2,484 | 2,363 | 5,259 | 5,005 | |||||||||||||||||||
| Total revenues | 25,168 | 23,621 | 51,149 | 48,311 | |||||||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| Cost of services (exclusive of depreciation and amortization) | (14,417) | (13,378) | (29,420) | (27,167) | |||||||||||||||||||
| Cost of products (exclusive of depreciation and amortization) | (1,484) | (1,432) | (3,150) | (3,049) | |||||||||||||||||||
| Selling, general, administrative and other | (4,073) | (3,981) | (8,194) | (7,911) | |||||||||||||||||||
| Depreciation and amortization | (1,405) | (1,324) | (2,721) | (2,600) | |||||||||||||||||||
| Total costs and expenses | (21,379) | (20,115) | (43,485) | (40,727) | |||||||||||||||||||
| Restructuring and impairment charges | (239) | (109) | (239) | (252) | |||||||||||||||||||
| Interest expense, net | (240) | (346) | (515) | (713) | |||||||||||||||||||
| Equity in the income of investees | 57 | 36 | 150 | 128 | |||||||||||||||||||
| Income before income taxes | 3,367 | 3,087 | 7,060 | 6,747 | |||||||||||||||||||
| Income taxes | (902) | 314 | (2,111) | (702) | |||||||||||||||||||
| Net income | 2,465 | 3,401 | 4,949 | 6,045 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | (218) | (126) | (300) | (216) | |||||||||||||||||||
| Net income attributable to The Walt Disney Company (Disney) | $ | 2,247 | $ | 3,275 | $ | 4,649 | $ | 5,829 | |||||||||||||||
| Earnings per share attributable to Disney: | |||||||||||||||||||||||
| Diluted | $ | 1.27 | $ | 1.81 | $ | 2.61 | $ | 3.21 | |||||||||||||||
| Basic | $ | 1.27 | $ | 1.81 | $ | 2.62 | $ | 3.22 | |||||||||||||||
| Weighted average number of common and common equivalent shares outstanding: | |||||||||||||||||||||||
| Diluted | 1,772 | 1,814 | 1,782 | 1,816 | |||||||||||||||||||
| Basic | 1,766 | 1,808 | 1,776 | 1,810 | |||||||||||||||||||
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited; in millions)
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Net income | $ | 2,465 | $ | 3,401 | $ | 4,949 | $ | 6,045 | |||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Market value adjustments for hedges | 177 | (253) | 208 | 109 | |||||||||||||||||||
| Pension and postretirement medical plan adjustments | 5 | 18 | 2 | 43 | |||||||||||||||||||
| Foreign currency translation and other | (224) | 54 | (211) | 606 | |||||||||||||||||||
| Other comprehensive income (loss) | (42) | (181) | (1) | 758 | |||||||||||||||||||
| Comprehensive income | 2,423 | 3,220 | 4,948 | 6,803 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | (218) | (126) | (300) | (216) | |||||||||||||||||||
| Other comprehensive income (loss) attributable to noncontrolling interests | (9) | (8) | (36) | 64 | |||||||||||||||||||
| Comprehensive income attributable to Disney | $ | 2,196 | $ | 3,086 | $ | 4,612 | $ | 6,651 |
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited; in millions, except per share data)
| March 28, 2026 | September 27, 2025 | ||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 5,682 | $ | 5,695 | |||||||
| Receivables, net | 14,390 | 13,217 | |||||||||
| Inventories | 2,080 | 2,134 | |||||||||
| Content advances | 1,167 | 2,063 | |||||||||
| Other current assets | 1,280 | 1,158 | |||||||||
| Total current assets | 24,599 | 24,267 | |||||||||
| Produced and licensed content costs | 30,360 | 31,327 | |||||||||
| Investments | 8,397 | 8,097 | |||||||||
| Parks, resorts and other property | |||||||||||
| Attractions, buildings and equipment | 86,202 | 82,041 | |||||||||
| Accumulated depreciation | (48,098) | (48,889) | |||||||||
| 38,104 | 33,152 | ||||||||||
| Projects in progress | 4,966 | 6,911 | |||||||||
| Land | 1,185 | 1,192 | |||||||||
| 44,255 | 41,255 | ||||||||||
| Intangible assets, net | 10,062 | 9,272 | |||||||||
| Goodwill | 74,682 | 73,294 | |||||||||
| Other assets | 12,862 | 10,002 | |||||||||
| Total assets | $ | 205,217 | $ | 197,514 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable and other accrued liabilities | $ | 19,961 | $ | 21,203 | |||||||
| Current portion of borrowings | 8,887 | 6,711 | |||||||||
| Deferred revenue and other | 7,375 | 6,248 | |||||||||
| Total current liabilities | 36,223 | 34,162 | |||||||||
| Borrowings | 38,471 | 35,315 | |||||||||
| Deferred income taxes | 5,050 | 3,524 | |||||||||
| Other long-term liabilities | 10,161 | 9,901 | |||||||||
| Commitments and contingencies (Note 12) | |||||||||||
| Equity | |||||||||||
| Preferred stock | — | — | |||||||||
| Common stock and additional paid-in capital, $0.01 par value, Authorized – 4.6 billion shares, Issued – 1.9 billion shares | 62,256 | 59,814 | |||||||||
| Retained earnings | 62,393 | 60,410 | |||||||||
| Accumulated other comprehensive loss | (2,951) | (2,914) | |||||||||
| Treasury stock, at cost, 130 million shares at March 28, 2026 and 79 million shares at September 27, 2025 | (12,990) | (7,441) | |||||||||
| Total Disney Shareholders’ equity | 108,708 | 109,869 | |||||||||
| Noncontrolling interests | 6,604 | 4,743 | |||||||||
| Total equity | 115,312 | 114,612 | |||||||||
| Total liabilities and equity | $ | 205,217 | $ | 197,514 |
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited; in millions)
| Six Months Ended | |||||||||||
| March 28, 2026 | March 29, 2025 | ||||||||||
| OPERATING ACTIVITIES | |||||||||||
| Net income | $ | 4,949 | $ | 6,045 | |||||||
| Depreciation and amortization | 2,721 | 2,600 | |||||||||
| Deferred income taxes | 918 | 93 | |||||||||
| Equity in the income of investees | (150) | (128) | |||||||||
| Cash distributions received from equity investees | 152 | 79 | |||||||||
| Net change in produced and licensed content costs and advances | 1,999 | 1,889 | |||||||||
| Equity-based compensation | 737 | 647 | |||||||||
| Other, net | 55 | 205 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Receivables | (1,165) | (367) | |||||||||
| Inventories | 3 | (1) | |||||||||
| Other assets | (350) | 10 | |||||||||
| Accounts payable and other liabilities | (508) | (1,025) | |||||||||
| Income taxes | (1,712) | (89) | |||||||||
| Cash provided by operations | 7,649 | 9,958 | |||||||||
| INVESTING ACTIVITIES | |||||||||||
| Investments in parks, resorts and other property | (4,986) | (4,328) | |||||||||
| Acquisitions and purchase of investments, net | (540) | (83) | |||||||||
| Other, net | 57 | (62) | |||||||||
| Cash used in investing activities | (5,469) | (4,473) | |||||||||
| FINANCING ACTIVITIES | |||||||||||
| Commercial paper borrowings (payments), net | 3,480 | (791) | |||||||||
| Borrowings | 5,046 | 1,057 | |||||||||
| Reduction of borrowings | (3,537) | (2,913) | |||||||||
| Dividends | (1,337) | (905) | |||||||||
| Repurchases of common stock | (5,500) | (1,785) | |||||||||
| Other, net | (314) | (216) | |||||||||
| Cash used in financing activities | (2,162) | (5,553) | |||||||||
| Impact of exchange rates on cash, cash equivalents and restricted cash | (28) | (76) | |||||||||
| Change in cash, cash equivalents and restricted cash | (10) | (144) | |||||||||
| Cash, cash equivalents and restricted cash, beginning of period | 5,799 | 6,102 | |||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 5,789 | $ | 5,958 |
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(unaudited; in millions)
| Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Disney | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares(1) | Common Stock and Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total Disney Equity | Non-controlling Interests(2) | Total Equity | |||||||||||||||||||||||||||||||||||||||||||
| Balance at December 27, 2025 | 1,776 | $ | 60,704 | $ | 60,164 | $ | (2,900) | $ | (9,492) | $ | 108,476 | $ | 5,532 | $ | 114,008 | |||||||||||||||||||||||||||||||||||
| Comprehensive income (loss) | — | — | 2,247 | (51) | — | 2,196 | 227 | 2,423 | ||||||||||||||||||||||||||||||||||||||||||
| Equity compensation activity | 2 | 321 | — | — | — | 321 | 5 | 326 | ||||||||||||||||||||||||||||||||||||||||||
| Dividends | — | 14 | (14) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Common stock repurchases | (33) | — | — | — | (3,466) | (3,466) | — | (3,466) | ||||||||||||||||||||||||||||||||||||||||||
| Fubo and NFL Transactions | — | 1,229 | — | — | — | 1,229 | 1,231 | 2,460 | ||||||||||||||||||||||||||||||||||||||||||
| Distributions and other | — | (12) | (4) | — | (32) | (48) | (391) | (439) | ||||||||||||||||||||||||||||||||||||||||||
| Balance at March 28, 2026 | 1,745 | $ | 62,256 | $ | 62,393 | $ | (2,951) | $ | (12,990) | $ | 108,708 | $ | 6,604 | $ | 115,312 | |||||||||||||||||||||||||||||||||||
| Balance at December 28, 2024 | 1,810 | $ | 58,868 | $ | 50,468 | $ | (2,688) | $ | (4,715) | $ | 101,933 | $ | 4,806 | $ | 106,739 | |||||||||||||||||||||||||||||||||||
| Comprehensive income (loss) | — | — | 3,275 | (189) | — | 3,086 | 135 | 3,221 | ||||||||||||||||||||||||||||||||||||||||||
| Equity compensation activity | 1 | 320 | — | — | — | 320 | — | 320 | ||||||||||||||||||||||||||||||||||||||||||
| Dividends | — | 7 | (7) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Common stock repurchases | (9) | — | — | — | (991) | (991) | — | (991) | ||||||||||||||||||||||||||||||||||||||||||
| Distributions and other | (1) | 4 | (3) | — | (10) | (9) | (514) | (523) | ||||||||||||||||||||||||||||||||||||||||||
| Balance at March 29, 2025 | 1,801 | $ | 59,199 | $ | 53,733 | $ | (2,877) | $ | (5,716) | $ | 104,339 | $ | 4,427 | $ | 108,766 |
(1)Shares are net of treasury shares.
(2)Excludes redeemable noncontrolling interests.
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(unaudited; in millions)
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Disney | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares(1) | Common Stock and Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total Disney Equity | Non-controlling Interests(2) | Total Equity | |||||||||||||||||||||||||||||||||||||||||||
| Balance at September 27, 2025 | 1,791 | $ | 59,814 | $ | 60,410 | $ | (2,914) | $ | (7,441) | $ | 109,869 | $ | 4,743 | $ | 114,612 | |||||||||||||||||||||||||||||||||||
| Comprehensive income (loss) | — | — | 4,649 | (37) | — | 4,612 | 336 | 4,948 | ||||||||||||||||||||||||||||||||||||||||||
| Equity compensation activity | 5 | 566 | — | — | — | 566 | 5 | 571 | ||||||||||||||||||||||||||||||||||||||||||
| Dividends | — | 14 | (2,665) | — | — | (2,651) | — | (2,651) | ||||||||||||||||||||||||||||||||||||||||||
| Common stock repurchases | (51) | — | — | — | (5,500) | (5,500) | — | (5,500) | ||||||||||||||||||||||||||||||||||||||||||
| Fubo and NFL Transactions | — | 1,875 | — | — | — | 1,875 | 1,933 | 3,808 | ||||||||||||||||||||||||||||||||||||||||||
| Distributions and other | — | (13) | (1) | — | (49) | (63) | (413) | (476) | ||||||||||||||||||||||||||||||||||||||||||
| Balance at March 28, 2026 | 1,745 | $ | 62,256 | $ | 62,393 | $ | (2,951) | $ | (12,990) | $ | 108,708 | $ | 6,604 | $ | 115,312 | |||||||||||||||||||||||||||||||||||
| Balance at September 28, 2024 | 1,812 | $ | 58,592 | $ | 49,722 | $ | (3,699) | $ | (3,919) | $ | 100,696 | $ | 4,826 | $ | 105,522 | |||||||||||||||||||||||||||||||||||
| Comprehensive income | — | — | 5,829 | 822 | — | 6,651 | 153 | 6,804 | ||||||||||||||||||||||||||||||||||||||||||
| Equity compensation activity | 6 | 596 | — | — | — | 596 | — | 596 | ||||||||||||||||||||||||||||||||||||||||||
| Dividends | — | 7 | (1,814) | — | — | (1,807) | — | (1,807) | ||||||||||||||||||||||||||||||||||||||||||
| Common stock repurchases | (16) | — | — | — | (1,785) | (1,785) | — | (1,785) | ||||||||||||||||||||||||||||||||||||||||||
| Distributions and other | (1) | 4 | (4) | — | (12) | (12) | (552) | (564) | ||||||||||||||||||||||||||||||||||||||||||
| Balance at March 29, 2025 | 1,801 | $ | 59,199 | $ | 53,733 | $ | (2,877) | $ | (5,716) | $ | 104,339 | $ | 4,427 | $ | 108,766 |
(1)Shares are net of treasury shares.
(2)Excludes redeemable noncontrolling interests.
See Notes to Condensed Consolidated Financial Statements
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
**1.**Basis of Presentation
These Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. We believe that we have included all normal recurring adjustments necessary for a fair statement of the results for the interim period. Operating results for the six months ended March 28, 2026 are not necessarily indicative of the results that may be expected for the year ending October 3, 2026.
The terms “Company,” “Disney,” “we,” “us,” and “our” are used in this report to refer collectively to the parent company, The Walt Disney Company, as well as the subsidiaries through which its various businesses are actually conducted.
These financial statements should be read in conjunction with the Company’s 2025 Annual Report on Form 10-K.
Effective January 31, 2026, the financial results attributable to the media assets acquired from the NFL have been included in the Company’s Condensed Consolidated Financial Statements. See Note 4 for additional information.
Effective October 29, 2025, the financial results attributable to FuboTV Inc. (Fubo) have been included in the Company’s Condensed Consolidated Financial Statements. See Note 4 for additional information.
On November 14, 2024, the Company and Reliance Industries Limited (RIL) formed a joint venture (India joint venture) that combined the Company’s Star-branded and other general entertainment and sports television channels and Disney+ Hotstar streaming service in India (Star India) with certain media and entertainment businesses controlled by RIL (the Star India Transaction). The Company has a 37% interest in the India joint venture and recognizes its share of the joint venture’s results in “Equity in the income of investees.” Star India’s results through November 14, 2024 were consolidated in the Company’s financial results.
Variable Interest Entities
The Company enters into relationships with or makes investments in other entities that may be variable interest entities (VIE). A VIE is consolidated in our financial statements if the Company has the power to direct activities that most significantly impact the economic performance of the VIE and has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant (as defined by ASC 810-10-25-38) to the VIE. Hong Kong Disneyland Resort and Shanghai Disney Resort (together the Asia Theme Parks, see Note 6) are VIEs in which the Company has less than 50% equity ownership. Company subsidiaries (the Management Companies) have management agreements with the Asia Theme Parks, which provide the Management Companies, subject to certain protective rights of joint venture partners, with the ability to direct the day-to-day operating activities and the development of business strategies that we believe most significantly impact the economic performance of the Asia Theme Parks. In addition, the Management Companies receive management fees under these arrangements that we believe could be significant to the Asia Theme Parks. Therefore, the Company has consolidated the Asia Theme Parks in its financial statements.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results may differ from those estimates.
Reclassifications
Certain reclassifications have been made in the fiscal 2025 financial statements and notes to conform to the fiscal 2026 presentation.
**2.**Segment Information
The Company’s operations are reported in three segments: Entertainment, Sports and Experiences, for which separate financial information, including segment revenue and operating income, is evaluated regularly by the Chief Executive Officer, the Chief Operating Decision Maker, to allocate resources and assess performance. In March 2026, the Company announced that the games business, which is reported as part of the Experiences segment, will be brought under the leadership structure of
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
the Entertainment segment. We will report under the new structure commencing with our fiscal 2027 reporting, at which time we will have implemented changes to our financial reporting processes.
Segment operating results reflect earnings before corporate and unallocated shared expenses, restructuring and impairment charges, net other income/expense, net interest expense, income taxes and noncontrolling interests. Segment operating income generally includes equity in the income of investees, except for our India joint venture, and excludes amortization of intangible assets and impacts from fair value adjustments recognized in connection with the fiscal 2019 acquisition of TFCF Corporation (TFCF) and Hulu LLC (Hulu) and business acquisitions occurring after fiscal 2025 (Acquisition Amortization). Corporate and unallocated shared expenses principally consist of corporate functions, executive management and certain unallocated administrative support functions.
Segment operating results include allocations of certain costs, including information technology, pension, legal and other shared services costs, which are allocated based on metrics designed to correlate with consumption.
Segment revenues, segment operating income and significant segment expenses are as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Entertainment | |||||||||||||||||||||||
| Third parties | $ | 11,541 | $ | 10,565 | $ | 22,995 | $ | 21,326 | |||||||||||||||
| Amounts eliminated in consolidation | 174 | 117 | 329 | 228 | |||||||||||||||||||
| 11,715 | 10,682 | 23,324 | 21,554 | ||||||||||||||||||||
| Sports | |||||||||||||||||||||||
| Third parties | 4,140 | 4,167 | 8,661 | 8,681 | |||||||||||||||||||
| Amounts eliminated in consolidation | 469 | 367 | 857 | 703 | |||||||||||||||||||
| 4,609 | 4,534 | 9,518 | 9,384 | ||||||||||||||||||||
| Experiences | 9,487 | 8,889 | 19,493 | 18,304 | |||||||||||||||||||
| Eliminations | (643) | (484) | (1,186) | (931) | |||||||||||||||||||
| Total segment revenues | $ | 25,168 | $ | 23,621 | $ | 51,149 | $ | 48,311 | |||||||||||||||
| Segment operating income: | |||||||||||||||||||||||
| Entertainment | $ | 1,336 | $ | 1,258 | $ | 2,436 | $ | 2,961 | |||||||||||||||
| Sports | 652 | 687 | 843 | 934 | |||||||||||||||||||
| Experiences | 2,615 | 2,491 | 5,924 | 5,601 | |||||||||||||||||||
| Total segment operating income(1) | $ | 4,603 | $ | 4,436 | $ | 9,203 | $ | 9,496 |
(1) Equity in the income of investees is included in segment operating income as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Entertainment | $ | 108 | $ | 124 | $ | 226 | $ | 242 | |||||||||||||||
| Sports | 13 | 18 | 16 | 28 | |||||||||||||||||||
| Equity in the income of investees included in segment operating income | 121 | 142 | 242 | 270 | |||||||||||||||||||
| Equity in the loss of India joint venture | (64) | (103) | (92) | (136) | |||||||||||||||||||
| Acquisition Amortization related to an equity investee | — | (3) | — | (6) | |||||||||||||||||||
| Equity in the income of investees | $ | 57 | $ | 36 | $ | 150 | $ | 128 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| Information about significant segment expenses | March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | |||||||||||||||||||
| Entertainment | |||||||||||||||||||||||
| Programming and production costs | $ | 6,406 | $ | 5,691 | $ | 12,720 | $ | 11,166 | |||||||||||||||
| Other segment operating expenses(1) | 1,500 | 1,361 | 2,969 | 2,701 | |||||||||||||||||||
| Selling, general, administrative and other | 2,330 | 2,293 | 4,956 | 4,587 | |||||||||||||||||||
| Depreciation and amortization | 251 | 203 | 469 | 381 | |||||||||||||||||||
| Total Entertainment costs and expenses | 10,487 | 9,548 | 21,114 | 18,835 | |||||||||||||||||||
| Sports | |||||||||||||||||||||||
| Programming and production costs | 3,357 | 3,267 | 7,489 | 7,310 | |||||||||||||||||||
| Other segment operating expenses(2) | 248 | 240 | 505 | 490 | |||||||||||||||||||
| Selling, general, administrative and other | 337 | 347 | 645 | 657 | |||||||||||||||||||
| Depreciation and amortization | 28 | 11 | 52 | 21 | |||||||||||||||||||
| Total Sports costs and expenses | 3,970 | 3,865 | 8,691 | 8,478 | |||||||||||||||||||
| Experiences | |||||||||||||||||||||||
| Operating labor | 2,355 | 2,213 | 4,640 | 4,377 | |||||||||||||||||||
| Infrastructure costs | 856 | 856 | 1,702 | 1,657 | |||||||||||||||||||
| Costs of goods sold and distribution costs | 773 | 723 | 1,716 | 1,652 | |||||||||||||||||||
| Other segment operating expenses(3) | 985 | 877 | 1,887 | 1,661 | |||||||||||||||||||
| Selling, general, administrative and other | 1,115 | 1,024 | 2,077 | 1,972 | |||||||||||||||||||
| Depreciation and amortization | 788 | 705 | 1,547 | 1,384 | |||||||||||||||||||
| Total Experiences costs and expenses | 6,872 | 6,398 | 13,569 | 12,703 | |||||||||||||||||||
| Eliminations(4) | (643) | (484) | (1,186) | (931) | |||||||||||||||||||
| Corporate and unallocated shared expenses | 380 | 395 | 684 | 855 | |||||||||||||||||||
| Acquisition Amortization(5) | 313 | 393 | 613 | 787 | |||||||||||||||||||
| Total costs and expenses | $ | 21,379 | $ | 20,115 | $ | 43,485 | $ | 40,727 |
(1)Other operating expenses of Entertainment include technology support costs, distribution costs and costs of goods sold.
(2)Other operating expenses of Sports include technology support costs and distribution costs.
(3)Other operating expenses of Experiences include costs for supplies, processing fees and entertainment offerings.
(4)Reflects fees paid by (a) the entertainment virtual multi-channel video programming distributor (vMVPD) services to the sports and entertainment linear networks for the right to air the networks on the Hulu Live TV and Fubo services and (b) the Entertainment segment to the Sports segment to program certain sports content on ABC Network and Disney+. The offset is included in Entertainment programming and production costs.
(5)Excludes Acquisition Amortization of intangible assets related to an equity investee.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
A reconciliation of segment operating income to income before income taxes is as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Segment operating income | $ | 4,603 | $ | 4,436 | $ | 9,203 | $ | 9,496 | |||||||||||||||
| Corporate and unallocated shared expenses | (380) | (395) | (684) | (855) | |||||||||||||||||||
| Equity in the loss of India joint venture | (64) | (103) | (92) | (136) | |||||||||||||||||||
| Restructuring and impairment charges(1) | (239) | (109) | (239) | (252) | |||||||||||||||||||
| Interest expense, net | (240) | (346) | (515) | (713) | |||||||||||||||||||
| Acquisition Amortization(2) | (313) | (396) | (613) | (793) | |||||||||||||||||||
| Income before income taxes | $ | 3,367 | $ | 3,087 | $ | 7,060 | $ | 6,747 |
(1)See Note 15 for a discussion of amounts in restructuring and impairment charges.
(2)Acquisition Amortization is as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Amortization of intangible assets | $ | 249 | $ | 327 | $ | 485 | $ | 654 | |||||||||||||||
| Step-up of film and television costs | 64 | 66 | 128 | 133 | |||||||||||||||||||
| Intangibles related to an equity investee | — | 3 | — | 6 | |||||||||||||||||||
| $ | 313 | $ | 396 | $ | 613 | $ | 793 |
**3.**Revenues
The following table presents revenues by segment and source:
| Quarter Ended March 28, 2026 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Subscription and affiliate fees | $ | 7,801 | $ | 3,251 | $ | — | $ | (470) | $ | 10,582 | |||||||||||||||||||
| Advertising | 1,670 | 1,132 | — | — | 2,802 | ||||||||||||||||||||||||
| Theme park admissions | — | — | 3,092 | — | 3,092 | ||||||||||||||||||||||||
| Resorts and vacations | — | — | 2,564 | — | 2,564 | ||||||||||||||||||||||||
| Retail and wholesale sales of merchandise, food and beverage | — | — | 2,442 | — | 2,442 | ||||||||||||||||||||||||
| Merchandise licensing | 146 | — | 719 | — | 865 | ||||||||||||||||||||||||
| Content sales | 1,725 | — | — | — | 1,725 | ||||||||||||||||||||||||
| Other | 373 | 226 | 670 | (173) | 1,096 | ||||||||||||||||||||||||
| $ | 11,715 | $ | 4,609 | $ | 9,487 | $ | (643) | $ | 25,168 | ||||||||||||||||||||
| Quarter Ended March 29, 2025 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Subscription and affiliate fees | $ | 6,858 | $ | 3,080 | $ | — | $ | (332) | $ | 9,606 | |||||||||||||||||||
| Advertising | 1,598 | 1,157 | — | — | 2,755 | ||||||||||||||||||||||||
| Theme park admissions | — | — | 2,919 | — | 2,919 | ||||||||||||||||||||||||
| Resorts and vacations | — | — | 2,359 | — | 2,359 | ||||||||||||||||||||||||
| Retail and wholesale sales of merchandise, food and beverage | — | — | 2,333 | — | 2,333 | ||||||||||||||||||||||||
| Merchandise licensing | 148 | — | 704 | — | 852 | ||||||||||||||||||||||||
| Content sales | 1,594 | 50 | — | — | 1,644 | ||||||||||||||||||||||||
| Other | 484 | 247 | 574 | (152) | 1,153 | ||||||||||||||||||||||||
| $ | 10,682 | $ | 4,534 | $ | 8,889 | $ | (484) | $ | 23,621 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
| Six Months Ended March 28, 2026 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Subscription and affiliate fees | $ | 15,051 | $ | 6,234 | $ | — | $ | (886) | $ | 20,399 | |||||||||||||||||||
| Advertising | 3,445 | 2,609 | — | — | 6,054 | ||||||||||||||||||||||||
| Theme park admissions | — | — | 6,393 | — | 6,393 | ||||||||||||||||||||||||
| Resorts and vacations | — | — | 4,974 | — | 4,974 | ||||||||||||||||||||||||
| Retail and wholesale sales of merchandise, food and beverage | — | — | 5,183 | — | 5,183 | ||||||||||||||||||||||||
| Merchandise licensing | 339 | — | 1,663 | — | 2,002 | ||||||||||||||||||||||||
| Content sales | 3,661 | 60 | — | — | 3,721 | ||||||||||||||||||||||||
| Other | 828 | 615 | 1,280 | (300) | 2,423 | ||||||||||||||||||||||||
| $ | 23,324 | $ | 9,518 | $ | 19,493 | $ | (1,186) | $ | 51,149 |
| Six Months Ended March 29, 2025 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Subscription and affiliate fees | $ | 13,578 | $ | 6,137 | $ | — | $ | (653) | $ | 19,062 | |||||||||||||||||||
| Advertising | 3,496 | 2,499 | — | — | 5,995 | ||||||||||||||||||||||||
| Theme park admissions | — | — | 6,006 | — | 6,006 | ||||||||||||||||||||||||
| Resorts and vacations | — | — | 4,580 | — | 4,580 | ||||||||||||||||||||||||
| Retail and wholesale sales of merchandise, food and beverage | — | — | 4,905 | — | 4,905 | ||||||||||||||||||||||||
| Merchandise licensing | 313 | — | 1,631 | — | 1,944 | ||||||||||||||||||||||||
| Content sales | 3,179 | 128 | — | — | 3,307 | ||||||||||||||||||||||||
| Other | 988 | 620 | 1,182 | (278) | 2,512 | ||||||||||||||||||||||||
| $ | 21,554 | $ | 9,384 | $ | 18,304 | $ | (931) | $ | 48,311 |
The following table presents revenues by segment and primary geographical markets:
| Quarter Ended March 28, 2026 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Americas | $ | 9,230 | $ | 4,509 | $ | 7,303 | $ | (643) | $ | 20,399 | |||||||||||||||||||
| Europe | 1,848 | 78 | 928 | — | 2,854 | ||||||||||||||||||||||||
| Asia Pacific | 637 | 22 | 1,256 | — | 1,915 | ||||||||||||||||||||||||
| Total revenues | $ | 11,715 | $ | 4,609 | $ | 9,487 | $ | (643) | $ | 25,168 | |||||||||||||||||||
| Quarter Ended March 29, 2025 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Americas | $ | 8,556 | $ | 4,443 | $ | 6,970 | $ | (484) | $ | 19,485 | |||||||||||||||||||
| Europe | 1,573 | 72 | 805 | — | 2,450 | ||||||||||||||||||||||||
| Asia Pacific | 553 | 19 | 1,114 | — | 1,686 | ||||||||||||||||||||||||
| Total revenues | $ | 10,682 | $ | 4,534 | $ | 8,889 | $ | (484) | $ | 23,621 | |||||||||||||||||||
| Six Months Ended March 28, 2026 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Americas | $ | 18,252 | $ | 9,322 | $ | 14,873 | $ | (1,186) | $ | 41,261 | |||||||||||||||||||
| Europe | 3,624 | 153 | 2,156 | — | 5,933 | ||||||||||||||||||||||||
| Asia Pacific | 1,448 | 43 | 2,464 | — | 3,955 | ||||||||||||||||||||||||
| Total revenues | $ | 23,324 | $ | 9,518 | $ | 19,493 | $ | (1,186) | $ | 51,149 | |||||||||||||||||||
| Six Months Ended March 29, 2025 | |||||||||||||||||||||||||||||
| Entertainment | Sports | Experiences | Eliminations | Total | |||||||||||||||||||||||||
| Americas | $ | 17,048 | $ | 9,159 | $ | 14,091 | $ | (931) | $ | 39,367 | |||||||||||||||||||
| Europe | 3,224 | 149 | 1,932 | — | 5,305 | ||||||||||||||||||||||||
| Asia Pacific | 1,282 | 76 | 2,281 | — | 3,639 | ||||||||||||||||||||||||
| Total revenues | $ | 21,554 | $ | 9,384 | $ | 18,304 | $ | (931) | $ | 48,311 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
Revenues recognized in the current and prior-year periods from performance obligations satisfied (or partially satisfied) in previous reporting periods primarily relate to revenues earned on content made available to distributors and licensees in previous reporting periods. For the quarter ended March 28, 2026, $0.9 billion was recognized related to performance obligations satisfied as of December 27, 2025. For the six months ended March 28, 2026, $0.6 billion was recognized related to performance obligations satisfied as of September 27, 2025. For the quarter ended March 29, 2025, $0.6 billion was recognized related to performance obligations satisfied as of December 28, 2024. For the six months ended March 29, 2025, $0.6 billion was recognized related to performance obligations satisfied as of September 28, 2024.
As of March 28, 2026, revenue for unsatisfied performance obligations expected to be recognized in the future is $17 billion, primarily for IP to be made available in the future under existing agreements with merchandise and co-branding licensees and sponsors, wholesalers of streaming services, television station affiliates and sports sublicensees. Of this amount, we expect to recognize approximately $4 billion in the remainder of fiscal 2026, $5 billion in fiscal 2027, $4 billion in fiscal 2028 and $4 billion thereafter. These amounts include only fixed consideration or minimum guarantees and do not include amounts related to (i) contracts with an original expected term of one year or less or (ii) licenses of IP that are solely based on the sales of the licensee.
Accounts receivable and deferred revenues from contracts with customers are as follows:
| March 28, 2026 | September 27, 2025 | ||||||||||
| Accounts receivable | |||||||||||
| Current | $ | 12,146 | $ | 10,544 | |||||||
| Non-current | 1,082 | 985 | |||||||||
| Allowance for credit losses | (138) | (126) | |||||||||
| Deferred revenues | |||||||||||
| Current | 6,867 | 5,689 | |||||||||
| Non-current | 723 | 785 |
For the quarter and six months ended March 28, 2026, the Company recognized revenue of $0.9 billion and $4.7 billion, respectively, that was included in the September 27, 2025 deferred revenue balance. For the quarter and six months ended March 29, 2025, the Company recognized revenue of $1.0 billion and $4.5 billion, respectively, that was included in the September 28, 2024 deferred revenue balance. Amounts deferred generally relate to theme park admissions and vacation packages, subscriptions to streaming services and advances related to merchandise and TV/VOD licenses.
**4.**Acquisitions and Dispositions
NFL media assets
In January 2026, ESPN acquired NFL Network and certain other media assets owned and controlled by NFL Enterprises LLC, including the NFL RedZone channel’s pay TV distribution and NFL Fantasy (collectively the Specified Assets), from NFL Enterprises LLC in exchange for a 10% noncontrolling interest in ESPN (the NFL Transaction). This transaction will allow the Company to expand audience reach, increase accessibility and flexibility for consumers, drive innovation, and offer more high-quality content at competitive prices. Following the NFL Transaction, the Company has an effective 72% interest in ESPN and Hearst Corporation has an 18% interest. After July 2034, based on the performance of the Specified Assets, the Company may have the right to reacquire the NFL’s interest in ESPN in exchange for a ten-year note at 70% of the then fair market value of the NFL’s interest in ESPN (the Exchange Right). Alternatively, on a similar time frame, the NFL may have the right to acquire up to a 4% additional equity interest in ESPN at a purchase price equal to 70% of the then fair market value of the additional interest in ESPN.
The estimated fair value of the NFL Transaction is approximately $3 billion. A significant portion of the transaction value will be deferred in other assets until 2033 and amortized as an expense thereafter, or, in the case that the Company exercises its Exchange Right, would be charged to equity. The remaining transaction value was primarily allocated to identifiable intangible assets.
Effective January 31, 2026, the Company has included the financial results attributable to the Specified Assets in the Condensed Consolidated Financial Statements. These were not significant to the Company’s revenue and net income for the quarter and six months ended March 28, 2026. Because the NFL Transaction was the exchange of equity interests, the $3 billion fair value is a non-cash transaction and is not reflected in the Condensed Consolidated Statement of Cash Flow.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
FuboTV Inc.
On October 29, 2025, the Company and Fubo, a publicly traded vMVPD, combined certain Hulu Live TV assets, including its carriage agreements, subscription agreements and related data, advertising and sponsorship agreements and intellectual property exclusively related to the “Live TV” brand, with Fubo (the Fubo Transaction). The Company has a 70% economic interest in the combined operations, a 70% voting interest in Fubo on a fully diluted basis and the right to appoint a majority of Fubo’s Board of Directors. The remaining 30% equity interest in Fubo is retained by Fubo public shareholders.
Based on the closing price of Fubo common stock of $3.69 on October 29, 2025, the estimated fair value of Fubo was $1.3 billion, which was primarily allocated to goodwill of $1.4 billion and identifiable intangible assets of $0.4 billion, partially offset by debt of $0.4 billion. Goodwill reflects the synergies expected from enhancing and expanding the Company’s vMVPD offerings with more high-quality offerings, choice and increased flexibility.
Effective October 29, 2025, the Company has included the financial results attributable to Fubo in the Condensed Consolidated Financial Statements. Revenue included in the quarter and six months ended March 28, 2026 was approximately $0.4 billion and $0.7 billion, respectively. The impact on the Company’s net income was not significant for the quarter and six months ended March 28, 2026.
Pursuant to an agreement entered into as part of the Fubo Transaction, the Company is the exclusive distributor of the Hulu Live TV service for five years (renewable for an additional five-year term by mutual agreement) and pays a wholesale fee to Fubo based on Fubo’s cost to program Hulu Live TV. Under the same agreement, the Company manages the marketing for Hulu Live TV and sells advertising for the Hulu Live TV and Fubo services for a fee.
Goodwill
The changes in the carrying amount of goodwill are as follows:
| Entertainment | Sports | Experiences | Total | ||||||||||||||||||||||||||
| Balance at September 27, 2025 | $ | 51,258 | $ | 16,486 | $ | 5,550 | $ | 73,294 | |||||||||||||||||||||
| Fubo and NFL Transactions | 1,357 | 51 | — | 1,408 | |||||||||||||||||||||||||
| Currency translation adjustments and other, net | (20) | — | — | (20) | |||||||||||||||||||||||||
| Balance at March 28, 2026 | $ | 52,595 | $ | 16,537 | $ | 5,550 | $ | 74,682 |
**5.**Cash, Cash Equivalents, Restricted Cash and Borrowings
Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Condensed Consolidated Balance Sheets to the total of the amounts reported in the Condensed Consolidated Statements of Cash Flows.
| March 28, 2026 | September 27, 2025 | |||||||||||||
| Cash and cash equivalents | $ | 5,682 | $ | 5,695 | ||||||||||
| Restricted cash included in other assets | 107 | 104 | ||||||||||||
| Total cash, cash equivalents and restricted cash in the statement of cash flows | $ | 5,789 | $ | 5,799 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
Borrowings
During the six months ended March 28, 2026, the Company’s borrowing activity was as follows:
| September 27, 2025 | Borrowings | Payments | Other Activity | March 28, 2026 | |||||||||||||||||||||||||||||||
| Commercial paper with original maturities less than three months(1) | $ | 1,963 | $ | — | $ | (183) | $ | (3) | $ | 1,777 | |||||||||||||||||||||||||
| Commercial paper with original maturities greater than three months | 99 | 6,479 | (2,816) | 41 | 3,803 | ||||||||||||||||||||||||||||||
| U.S. dollar denominated borrowings(2) | 38,658 | 5,046 | (3,537) | 274 | 40,441 | ||||||||||||||||||||||||||||||
| Asia Theme Parks borrowings | 1,075 | — | — | 19 | 1,094 | ||||||||||||||||||||||||||||||
| Foreign currency denominated borrowings and other | 231 | — | — | 12 | 243 | ||||||||||||||||||||||||||||||
| $ | 42,026 | $ | 11,525 | $ | (6,536) | $ | 343 | $ | 47,358 |
(1)Borrowings and reductions of borrowings are reported net.
(2)The other activity includes borrowings assumed in the acquisition of Fubo.
At March 28, 2026, the Company’s bank facilities, which are with a syndicate of lenders and support our commercial paper borrowings, were as follows:
| Committed Capacity | Capacity Used | Unused Capacity | |||||||||||||||
| Facility expiring February 2027 | $ | 5,250 | $ | — | $ | 5,250 | |||||||||||
| Facility expiring March 2029 | 3,000 | — | 3,000 | ||||||||||||||
| Facility expiring February 2031 | 4,000 | — | 4,000 | ||||||||||||||
| Total | $ | 12,250 | $ | — | $ | 12,250 |
The Company had a $5.25 billion bank facility that was scheduled to expire in February 2026 and a $4.0 billion facility that was scheduled to expire in March 2027. The facility expiring in February 2026 was refinanced with a new $5.25 billion bank facility maturing in February 2027 and the facility expiring in March 2027 was refinanced with a new $4.0 billion facility maturing in February 2031.
The Company’s bank facilities allow for borrowings at rates based on the Secured Overnight Financing Rate (SOFR) and at other variable rates for non-U.S. dollar denominated borrowings, plus a fixed spread that varies with the Company’s debt ratings assigned by Moody’s Ratings and S&P Global Ratings ranging from 0.63% to 1.10%. The bank facilities contain only one financial covenant relating to interest coverage of three times earnings before interest, taxes, depreciation and amortization, including both intangible amortization and amortization of our film and television production and programming costs. On March 28, 2026, the Company met this covenant by a significant margin. The bank facilities specifically exclude certain entities, including the Asia Theme Parks and Fubo, from any representations, covenants or events of default. The Company also has the ability to issue up to $500 million of letters of credit under the facility expiring in February 2031, which if utilized, reduces available borrowings under this facility. As of March 28, 2026, the Company has $0.4 billion of outstanding letters of credit, of which none were issued under this facility.
U.S. Dollar Denominated Borrowings
In February 2026, the Company borrowed $3.5 billion of fixed rate U.S. dollar denominated notes with maturities ranging from 3 to 10 years and stated interest rates that range from 3.75% to 4.63%. In addition, the Company borrowed $0.5 billion of floating rate U.S. dollar denominated notes that mature in 3 years and are indexed to SOFR plus a spread.
Cruise Ship Credit Facilities
In October 2025, in connection with the delivery of the Disney Destiny, the Company borrowed $1.1 billion with a fixed interest rate of 3.74%. Payments are due semi-annually over a 12-year term.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
Interest expense, net
Interest expense (net of amounts capitalized), interest and investment income, and net periodic pension and postretirement benefit costs (other than service costs) (see Note 8) are reported net in the Condensed Consolidated Statements of Income and consist of the following:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Interest expense | $ | (473) | $ | (471) | $ | (916) | $ | (958) | |||||||||||||||
| Interest and investment income | 118 | 60 | 170 | 114 | |||||||||||||||||||
| Net periodic pension and postretirement benefit costs (other than service costs) | 115 | 65 | 231 | 131 | |||||||||||||||||||
| Interest expense, net | $ | (240) | $ | (346) | $ | (515) | $ | (713) |
Interest and investment income includes gains and losses on certain publicly traded and non-public investments, investment impairments and interest earned on cash and cash equivalents and certain receivables.
**6.**International Theme Parks
The Company has a 48% ownership interest in the operations of Hong Kong Disneyland Resort and a 43% ownership interest in the operations of Shanghai Disney Resort. The Asia Theme Parks together with Disneyland Paris are collectively referred to as the International Theme Parks.
The following table summarizes the carrying amounts of the Asia Theme Parks’ assets and liabilities included in the Company’s Condensed Consolidated Balance Sheets:
| March 28, 2026 | September 27, 2025 | ||||||||||
| Cash and cash equivalents | $ | 516 | $ | 428 | |||||||
| Other current assets | 203 | 184 | |||||||||
| Total current assets | 719 | 612 | |||||||||
| Parks, resorts and other property | 6,288 | 6,060 | |||||||||
| Other assets | 283 | 287 | |||||||||
| Total assets | $ | 7,290 | $ | 6,959 | |||||||
| Current liabilities | $ | 696 | $ | 734 | |||||||
| Long-term borrowings | 1,094 | 1,075 | |||||||||
| Other long-term liabilities | 503 | 489 | |||||||||
| Total liabilities | $ | 2,293 | $ | 2,298 |
The following table summarizes the International Theme Parks’ revenues and costs and expenses included in the Company’s Condensed Consolidated Statements of Income for the six months ended March 28, 2026:
| Revenues | $ | 3,133 | |||
| Costs and expenses | (2,626) | ||||
Asia Theme Parks’ royalty and management fees of $176 million for the six months ended March 28, 2026 are eliminated in consolidation, but are considered in calculating earnings attributable to noncontrolling interests.
International Theme Parks’ cash flows included in the Company’s Condensed Consolidated Statements of Cash Flows for the six months ended March 28, 2026 were $772 million provided by operating activities, $685 million used in investing activities and $19 million provided by financing activities.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
**7.**Produced and Acquired/Licensed Content Costs and Advances
Total capitalized produced and licensed content by predominant monetization strategy is as follows:
| As of March 28, 2026 | As of September 27, 2025 | ||||||||||||||||||||||||||||||||||
| Predominantly Monetized Individually | Predominantly Monetized as a Group | Total | Predominantly Monetized Individually | Predominantly Monetized as a Group | Total | ||||||||||||||||||||||||||||||
| Produced content | |||||||||||||||||||||||||||||||||||
| Released, less amortization | $ | 5,000 | $ | 14,313 | $ | 19,313 | $ | 4,624 | $ | 14,288 | $ | 18,912 | |||||||||||||||||||||||
| Completed, not released | 562 | 916 | 1,478 | 313 | 1,061 | 1,374 | |||||||||||||||||||||||||||||
| In-process | 2,193 | 3,687 | 5,880 | 4,082 | 3,633 | 7,715 | |||||||||||||||||||||||||||||
| In development or pre-production | 418 | 84 | 502 | 386 | 182 | 568 | |||||||||||||||||||||||||||||
| $ | 8,173 | $ | 19,000 | 27,173 | $ | 9,405 | $ | 19,164 | 28,569 | ||||||||||||||||||||||||||
| Licensed content - Television programming rights and advances | 4,354 | 4,821 | |||||||||||||||||||||||||||||||||
| Total produced and licensed content | $ | 31,527 | $ | 33,390 | |||||||||||||||||||||||||||||||
| Current portion | $ | 1,167 | $ | 2,063 | |||||||||||||||||||||||||||||||
| Non-current portion | $ | 30,360 | $ | 31,327 |
Amortization of produced and licensed content is as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Produced content | |||||||||||||||||||||||
| Predominantly monetized individually | $ | 1,037 | $ | 839 | $ | 2,391 | $ | 1,535 | |||||||||||||||
| Predominantly monetized as a group | 1,770 | 1,733 | 3,384 | 3,546 | |||||||||||||||||||
| 2,807 | 2,572 | 5,775 | 5,081 | ||||||||||||||||||||
| Licensed programming rights and advances | 3,589 | 3,504 | 7,835 | 7,601 | |||||||||||||||||||
| Total produced and licensed content costs(1) | $ | 6,396 | $ | 6,076 | $ | 13,610 | $ | 12,682 |
(1)Primarily included in “Costs of services” in the Condensed Consolidated Statements of Income
**8.**Pension and Other Benefit Programs
The components of net periodic benefit cost (income) are as follows:
| Pension Plans | Postretirement Medical Plans | ||||||||||||||||||||||||||||||||||||||||||||||
| Quarter Ended | Six Months Ended | Quarter Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||
| Mar. 28, 2026 | Mar. 29, 2025 | Mar. 28, 2026 | Mar. 29, 2025 | Mar. 28, 2026 | Mar. 29, 2025 | Mar. 28, 2026 | Mar. 29, 2025 | ||||||||||||||||||||||||||||||||||||||||
| Service costs | $ | 62 | $ | 66 | $ | 123 | $ | 131 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
| Other costs (benefits): | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest costs | 200 | 197 | 399 | 392 | 11 | 11 | 22 | 22 | |||||||||||||||||||||||||||||||||||||||
| Expected return on plan assets | (306) | (291) | (612) | (581) | (16) | (15) | (32) | (30) | |||||||||||||||||||||||||||||||||||||||
| Amortization of previously deferred service costs (credits) | 2 | 2 | 3 | 2 | (23) | (23) | (45) | (45) | |||||||||||||||||||||||||||||||||||||||
| Recognized net actuarial loss (gain) | 24 | 61 | 48 | 123 | (7) | (7) | (14) | (14) | |||||||||||||||||||||||||||||||||||||||
| Total other costs (benefits) | (80) | (31) | (162) | (64) | (35) | (34) | (69) | (67) | |||||||||||||||||||||||||||||||||||||||
| Net periodic benefit cost (income) | $ | (18) | $ | 35 | $ | (39) | $ | 67 | $ | (35) | $ | (34) | $ | (69) | $ | (67) |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
**9.**Earnings Per Share
Diluted earnings per share amounts are based upon the weighted average number of common and common equivalent shares outstanding during the period and are calculated using the treasury stock method for equity-based compensation awards (Awards). A reconciliation of the weighted average number of common and common equivalent shares outstanding and the number of Awards excluded from the diluted earnings per share calculation, as they were anti-dilutive, are as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Shares (in millions): | |||||||||||||||||||||||
| Weighted average number of common and common equivalent shares outstanding (basic) | 1,766 | 1,808 | 1,776 | 1,810 | |||||||||||||||||||
| Weighted average dilutive impact of Awards | 6 | 6 | 6 | 6 | |||||||||||||||||||
| Weighted average number of common and common equivalent shares outstanding (diluted) | 1,772 | 1,814 | 1,782 | 1,816 | |||||||||||||||||||
| Awards excluded from diluted earnings per share | 14 | 13 | 13 | 15 |
**10.**Equity
The Company declared the following dividends in fiscal 2026 and 2025:
| Per Share | Amount | Payment Date | ||||||||||||||||||
| $0.75 | $1.3 billion(1) | July 22, 2026 | ||||||||||||||||||
| $0.75 | $1.3 billion | January 15, 2026 | ||||||||||||||||||
| $0.50 | $0.9 billion | July 23, 2025 | ||||||||||||||||||
| $0.50 | $0.9 billion | January 16, 2025 |
(1)Amount is estimated. The actual amount will be determined based on shareholders of record at the record date.
Share Repurchase Program
Effective February 7, 2024, the Board of Directors authorized the Company to repurchase a total of 400 million shares of its common stock. During the quarter and six months ended March 28, 2026, the Company repurchased 33 million and 51 million shares of its common stock for $3.5 billion and $5.5 billion, respectively. During the quarter and six months ended March 29, 2025, the Company repurchased 9 million and 17 million shares of its common stock for $1.0 billion and $1.8 billion, respectively. As of March 28, 2026, the Company had remaining authorization in place to repurchase approximately 288 million additional shares. The repurchase program does not have an expiration date.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
The following tables summarize the changes in each component of accumulated other comprehensive income (loss) (AOCI) including our proportional share of equity method investee amounts:
| Market Value Adjustments for Hedges | Unrecognized Pension and Postretirement Medical Expense | Foreign Currency Translation and Other | AOCI | ||||||||||||||||||||
| AOCI, before tax | |||||||||||||||||||||||
| Second quarter of fiscal 2026 | |||||||||||||||||||||||
| Balance at December 27, 2025 | $ | (507) | $ | (1,905) | $ | (1,098) | $ | (3,510) | |||||||||||||||
| Quarter Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 145 | 8 | (294) | (141) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 86 | (4) | — | 82 | |||||||||||||||||||
| Balance at March 28, 2026 | $ | (276) | $ | (1,901) | $ | (1,392) | $ | (3,569) | |||||||||||||||
| Second quarter of fiscal 2025 | |||||||||||||||||||||||
| Balance at December 28, 2024 | $ | 152 | $ | (2,210) | $ | (1,197) | $ | (3,255) | |||||||||||||||
| Quarter Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | (213) | (7) | 50 | (170) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (117) | 33 | — | (84) | |||||||||||||||||||
| Balance at March 29, 2025 | $ | (178) | $ | (2,184) | $ | (1,147) | $ | (3,509) | |||||||||||||||
| Six months ended fiscal 2026 | |||||||||||||||||||||||
| Balance at September 27, 2025 | $ | (549) | $ | (1,901) | $ | (1,085) | $ | (3,535) | |||||||||||||||
| Six Months Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 124 | 8 | (307) | (175) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 149 | (8) | — | 141 | |||||||||||||||||||
| Balance at March 28, 2026 | $ | (276) | $ | (1,901) | $ | (1,392) | $ | (3,569) | |||||||||||||||
| Six months ended fiscal 2025 | |||||||||||||||||||||||
| Balance at September 28, 2024 | $ | (319) | $ | (2,243) | $ | (1,855) | $ | (4,417) | |||||||||||||||
| Six Months Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 346 | (7) | (196) | 143 | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (205) | 66 | — | (139) | |||||||||||||||||||
| Star India Transaction | — | — | 904 | 904 | |||||||||||||||||||
| Balance at March 29, 2025 | $ | (178) | $ | (2,184) | $ | (1,147) | $ | (3,509) |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
| Market Value Adjustments for Hedges | Unrecognized Pension and Postretirement Medical Expense | Foreign Currency Translation and Other | AOCI | ||||||||||||||||||||
| Tax on AOCI | |||||||||||||||||||||||
| Second quarter of fiscal 2026 | |||||||||||||||||||||||
| Balance at December 27, 2025 | $ | 109 | $ | 447 | $ | 54 | $ | 610 | |||||||||||||||
| Quarter Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | (34) | — | 61 | 27 | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (20) | 1 | — | (19) | |||||||||||||||||||
| Balance at March 28, 2026 | $ | 55 | $ | 448 | $ | 115 | $ | 618 | |||||||||||||||
| Second quarter of fiscal 2025 | |||||||||||||||||||||||
| Balance at December 28, 2024 | $ | (38) | $ | 523 | $ | 82 | $ | 567 | |||||||||||||||
| Quarter Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 50 | — | (4) | 46 | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 27 | (8) | — | 19 | |||||||||||||||||||
| Balance at March 29, 2025 | $ | 39 | $ | 515 | $ | 78 | $ | 632 | |||||||||||||||
| Six months ended fiscal 2026 | |||||||||||||||||||||||
| Balance at September 27, 2025 | $ | 120 | $ | 446 | $ | 55 | $ | 621 | |||||||||||||||
| Six Months Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | (31) | — | 60 | 29 | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (34) | 2 | — | (32) | |||||||||||||||||||
| Balance at March 28, 2026 | $ | 55 | $ | 448 | $ | 115 | $ | 618 | |||||||||||||||
| Six months ended fiscal 2025 | |||||||||||||||||||||||
| Balance at September 28, 2024 | $ | 71 | $ | 531 | $ | 116 | $ | 718 | |||||||||||||||
| Six Months Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | (80) | — | 20 | (60) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 48 | (16) | — | 32 | |||||||||||||||||||
| Star India Transaction | — | — | (58) | (58) | |||||||||||||||||||
| Balance at March 29, 2025 | $ | 39 | $ | 515 | $ | 78 | $ | 632 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
| Market Value Adjustments for Hedges | Unrecognized Pension and Postretirement Medical Expense | Foreign Currency Translation and Other | AOCI | ||||||||||||||||||||
| AOCI, after tax | |||||||||||||||||||||||
| Second quarter of fiscal 2026 | |||||||||||||||||||||||
| Balance at December 27, 2025 | $ | (398) | $ | (1,458) | $ | (1,044) | $ | (2,900) | |||||||||||||||
| Quarter Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 111 | 8 | (233) | (114) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 66 | (3) | — | 63 | |||||||||||||||||||
| Balance at March 28, 2026 | $ | (221) | $ | (1,453) | $ | (1,277) | $ | (2,951) | |||||||||||||||
| Second quarter of fiscal 2025 | |||||||||||||||||||||||
| Balance at December 28, 2024 | $ | 114 | $ | (1,687) | $ | (1,115) | $ | (2,688) | |||||||||||||||
| Quarter Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | (163) | (7) | 46 | (124) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (90) | 25 | — | (65) | |||||||||||||||||||
| Balance at March 29, 2025 | $ | (139) | $ | (1,669) | $ | (1,069) | $ | (2,877) | |||||||||||||||
| Six months ended fiscal 2026 | |||||||||||||||||||||||
| Balance at September 27, 2025 | $ | (429) | $ | (1,455) | $ | (1,030) | $ | (2,914) | |||||||||||||||
| Six Months Ended March 28, 2026: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 93 | 8 | (247) | (146) | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | 115 | (6) | — | 109 | |||||||||||||||||||
| Balance at March 28, 2026 | $ | (221) | $ | (1,453) | $ | (1,277) | $ | (2,951) | |||||||||||||||
| Six months ended fiscal 2025 | |||||||||||||||||||||||
| Balance at September 28, 2024 | $ | (248) | $ | (1,712) | $ | (1,739) | $ | (3,699) | |||||||||||||||
| Six Months Ended March 29, 2025: | |||||||||||||||||||||||
| Unrealized gains (losses) arising during the period | 266 | (7) | (176) | 83 | |||||||||||||||||||
| Reclassifications of realized net (gains) losses to net income | (157) | 50 | — | (107) | |||||||||||||||||||
| Star India Transaction | — | — | 846 | 846 | |||||||||||||||||||
| Balance at March 29, 2025 | $ | (139) | $ | (1,669) | $ | (1,069) | $ | (2,877) |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
Details about AOCI components reclassified to net income are as follows:
| Gain (loss) in net income: | Affected line item in the Condensed Consolidated Statements of Income: | Quarter Ended | Six Months Ended | |||||||||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | |||||||||||||||||||||||||||||
| Market value adjustments, primarily cash flow hedges | Primarily revenue | $ | (86) | $ | 117 | $ | (149) | $ | 205 | |||||||||||||||||||||||
| Estimated tax | Income taxes | 20 | (27) | 34 | (48) | |||||||||||||||||||||||||||
| (66) | 90 | (115) | 157 | |||||||||||||||||||||||||||||
| Pension and postretirement medical expense | Interest expense, net | 4 | (33) | 8 | (66) | |||||||||||||||||||||||||||
| Estimated tax | Income taxes | (1) | 8 | (2) | 16 | |||||||||||||||||||||||||||
| 3 | (25) | 6 | (50) | |||||||||||||||||||||||||||||
| Total reclassifications for the period | $ | (63) | $ | 65 | $ | (109) | $ | 107 |
**11.**Equity-Based Compensation
Equity-based compensation expense related to stock options and restricted stock units (RSUs) is as follows:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Stock options | $ | 22 | $ | 17 | $ | 41 | $ | 33 | |||||||||||||||
| RSUs | 383 | 313 | 696 | 614 | |||||||||||||||||||
| Total equity-based compensation expense(1) | $ | 405 | $ | 330 | $ | 737 | $ | 647 | |||||||||||||||
| Equity-based compensation expense capitalized during the period | $ | 48 | $ | 46 | $ | 97 | $ | 90 |
(1)Equity-based compensation expense is net of capitalized equity-based compensation and estimated forfeitures and excludes amortization of previously capitalized equity-based compensation costs.
Unrecognized compensation cost related to unvested stock options and RSUs was $0.1 billion and $2.7 billion, respectively, as of March 28, 2026.
During the six months ended March 28, 2026, the Company made equity compensation grants for Disney stock consisting of 2.7 million stock options and 15.5 million RSUs with weighted average grant date fair values of $37 and $113, respectively. During the six months ended March 29, 2025, the weighted average grant date fair values for stock options and RSUs were $38 and $109, respectively.
**12.**Commitments and Contingencies
Legal Matters
Securities Actions
On May 12, 2023, a private securities class action lawsuit was filed in the U.S. District Court for the Central District of California against the Company, its former Chief Executive Officer, Robert Chapek, its former Chief Financial Officer, Christine M. McCarthy, and the former Chairman of the Disney Media and Entertainment Distribution segment, Kareem Daniel on behalf of certain purchasers of securities of the Company (the Securities Class Action). On November 6, 2023, a consolidated complaint was filed in the same action, adding Robert Iger, the Company’s Chief Executive Officer, as a defendant. Claims in the Securities Class Action include (i) violations of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder against all defendants, (ii) violations of Section 20A of the Exchange Act against Iger and McCarthy, and (iii) violations of Section 20(a) of the Exchange Act against all defendants. Plaintiffs in the Securities Class Action allege purported misstatements and omissions concerning, and a scheme to conceal, accurate costs and subscriber growth of the Disney+ platform. Plaintiffs seek unspecified damages, plus interest and costs and fees. The Company intends to defend against the lawsuit vigorously. The Company filed a motion to dismiss the complaint for failure to state a claim on December 21, 2023,
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
which was granted in part (dismissing the Section 20A claim against Iger) and otherwise denied on February 19, 2025. On March 28, 2025, the Company filed a motion for judgment on the pleadings, which was denied on May 21, 2025. The Company filed a petition for a writ of mandamus to the Ninth Circuit Court of Appeals, which was denied on July 18, 2025. The district court has set trial for August 17, 2027, and discovery is currently in progress. At this time we cannot reasonably estimate the amount of any possible loss.
On December 8, 2025, a private securities lawsuit was filed in the U.S. District Court for the Central District of California against the Company and certain former officers by Union Asset Management Holding AG and GIC Private Limited (the Union Asset Action). The Union Asset Action asserts the same claims and is based on substantially the same factual allegations and time period as the Securities Class Action, and seeks unspecified monetary damages. On January 2, 2026, the parties filed a joint stipulation to stay the Union Asset Action until the Securities Class Action concludes. The court granted the stay on March 3, 2026. The Company intends to defend against this lawsuit vigorously. The lawsuit is in the early stages, and at this time we cannot reasonably estimate the amount of any possible loss.
Derivative Actions
Eight shareholder derivative complaints have been filed against the Company and certain current and former officers and directors. Each of these actions asserts various claims including breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, waste, insider selling, and violations of federal securities laws based on substantially similar factual allegations as those asserted in the pending Securities Class Action.
-
On August 4, 2023, and December 15, 2023, two shareholder derivative complaints were filed in the U.S. District Court for the Central District of California by Hugues Gervat and Audrey McAdams, respectively. On April 29, 2024, these actions were consolidated (the Consolidated Derivative Action). The Consolidated Derivative Action is currently stayed until August 21, 2026.
-
On August 23, 2023, Stourbridge Investments LLC filed a shareholder derivative complaint in the U.S. District Court for the District of Delaware. On October 24, 2023, the action was voluntarily dismissed and, on November 16, 2023, refiled in the Delaware Court of Chancery. The Stourbridge action is currently stayed until the court in the Securities Class Action rules upon any motion for summary judgment.
-
On June 27, 2025, Thomas Payne filed a shareholder derivative complaint in the Delaware Court of Chancery. The Payne action is currently stayed until the court in the Securities Class Action rules upon any motion for summary judgment.
-
On November 5, 2025, Martin Siegel filed a shareholder derivative complaint in the Delaware Court of Chancery. The Siegel action is currently stayed until the court in the Securities Class Action rules upon any motion for summary judgment.
-
On November 14, 2025, Balraj Paul, the Montini Family Trust, and Dorothy Keto filed a shareholder derivative complaint in the U.S. District Court for the Central District of California. On January 14, 2026, the Paul action was consolidated into the Consolidated Derivative Action, which is stayed until August 21, 2026.
-
On February 24, 2026, Sean Martinez filed a shareholder derivative complaint in the Court of Chancery of the State of Delaware. On April 16, 2026, the Martinez action was stayed until the court in the Securities Class Action rules upon the motion for summary judgment.
-
On March 10, 2026, Karen Gioli filed a shareholder derivative complaint in the U.S. District Court for the Central District of California.
The actions seek declarative and injunctive relief, an award of unspecified damages to The Walt Disney Company and other costs and fees. The Company intends to defend against these lawsuits vigorously. The lawsuits are in the early stages, and at this time we cannot reasonably estimate the amount of any possible loss.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
Antitrust and Other Actions
On November 18, 2022, a private antitrust putative class action lawsuit was filed in the U.S. District Court for the Northern District of California against the Company on behalf of a putative class of certain subscribers to YouTube TV (the Biddle Action). The plaintiffs in the Biddle Action asserted a claim under Section 1 of the Sherman Act based on allegations that Disney uses certain pricing and packaging provisions in its carriage agreements with vMVPDs to increase prices for and reduce output of certain services offered by vMVPDs. On November 30, 2022, a second private antitrust putative class action lawsuit was filed in the U.S. District Court for the Northern District of California against the Company on behalf of a putative class of certain subscribers to DirecTV Stream (the Fendelander Action), making similar allegations. The Company filed motions to dismiss for failure to state a claim in both the Biddle Action and Fendelander Action on January 31, 2023. On September 30, 2023, the court issued an order granting in part and denying in part the Company’s motions to dismiss both cases and, on October 13, 2023, the court issued an order consolidating both cases. On October 16, 2023, plaintiffs filed a consolidated amended class action complaint (the Consolidated Complaint). The Consolidated Complaint asserts claims under Section 1 of the Sherman Act and certain Arizona, California, Florida, Illinois, Iowa, Massachusetts, Michigan, Nevada, New York, North Carolina, and Tennessee antitrust and consumer protection laws based on substantially similar allegations as the Biddle Action and the Fendelander Action. The Consolidated Complaint seeks injunctive relief, unspecified money damages and costs and fees. The Company filed a motion to dismiss the Consolidated Complaint for failure to state a claim on December 1, 2023.
On January 14, 2025, a private antitrust putative class action lawsuit was filed in the U.S. District Court for the Southern District of New York against the Company on behalf of a putative class of certain subscribers to fuboTV (the Unger Action), making similar allegations to those in the now-consolidated Biddle and Fendelander Actions (Biddle/Fendelander Action). The plaintiffs in the Unger Action also alleged that Disney impermissibly bundles ESPN with other Disney networks and unjustly enriched itself. The Unger Action has since been transferred to the Northern District of California with the court finding it related to the Biddle/Fendelander Action. The Unger plaintiffs filed an amended complaint on April 28, 2025, adding a named plaintiff and alleging essentially the same antitrust theories under the Sherman Act and the antitrust and consumer protection laws of thirty-seven states, the District of Columbia and Puerto Rico. The Unger plaintiffs seek damages and injunctive relief, including an injunction requiring the Company to segregate or divest any interest in Fubo and Hulu, or in the alternative, business assets relating to Fubo and Hulu + Live TV.
On May 30, 2025, the plaintiffs in the Biddle/Fendelander Action filed a proposed Second Consolidated Amended Complaint, adding a class of fuboTV subscribers, a Clayton Act § 7 claim challenging the Company’s acquisition of fuboTV on behalf of fuboTV subscribers, and a claim under Sherman Act § 2. On June 5, 2025, the Company and plaintiffs in the Biddle/Fendelander Action reached a settlement in principle to settle all claims on behalf of all YouTube TV, DirecTV Stream and fuboTV subscribers for an amount that is not material for the Company. The settlement was contingent on Plaintiffs’ Counsel in the Biddle/Fendelander Action (Biddle/Fendelander Counsel) obtaining or having authority to settle claims on behalf of all three subscriber classes, Court approval, and other contingencies. On June 10, 2025, the Court issued an order consolidating the Unger Action with the Biddle/Fendelander Action.
On July 21, 2025, the Court issued an order appointing Biddle/Fendelander Counsel to serve as interim lead counsel for the putative classes of YouTube TV and DirecTV Stream subscribers, and Unger Counsel to serve as interim lead counsel for the putative class of fuboTV subscribers, thereby resulting in Biddle/Fendelander Counsel not having authority to settle on behalf of the three putative classes of subscribers as required by the settlement in principle.
At a joint mediation held on October 3, 2025, the Company and plaintiffs in the Biddle/Fendelander Action reached a settlement in principle to settle all claims on behalf of all YouTube TV and DirecTV Stream subscribers for an amount that is not material for the Company. The settlement is contingent on Biddle/Fendelander Counsel obtaining Court approval and other contingencies. The Court issued an order granting preliminary approval of the settlement on March 31, 2026. The motion for final approval of the settlement is due on October 27, 2026, and the final approval hearing is scheduled for January 14, 2027.
The Company and Unger Counsel did not reach a settlement at the October 3, 2025 mediation. The Company filed a motion to compel arbitration of individual claims and dismiss class claims in the Unger Action on December 19, 2025. The Court heard argument on the Company’s motion to compel arbitration of individual claims and dismiss class claims on March 19, 2026, and the motion is still pending. The Company intends to continue to defend against the lawsuit vigorously. At this time, we expect any loss in the Unger Action would be in an amount that is not material for the Company.
On January 2, 2026, in litigation filed by the Company on August 28, 2025 asserting breach of contract claims against DISH Network L.L.C. (DISH) in the U.S. District Court for the Southern District of New York, DISH filed antitrust counterclaims against the Company. DISH filed amended counterclaims against the Company on March 13, 2026. DISH asserts a tying claim under Sherman Act § 1 and New York’s Donnelly Act challenging certain provisions in the Company’s carriage agreement with DISH; claims under Sherman Act § 1 challenging an ESPN / Fox One bundle, the creation of Fubo Sports, and
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
the Company’s acquisition of a controlling share of Fubo; a claim under Clayton Act § 7 challenging the Company’s acquisition of a controlling share of Fubo; and a claim under Sherman Act § 2 alleging the Company engaged in a pattern of conduct in an attempt to monopolize an alleged market for skinny sports bundles. DISH also asserts breach-of-contract counterclaims, contending that Company-affiliated entities violated their obligations under certain most-favored-nation provisions in the operative carriage agreement. The Company moved to dismiss the amended counterclaims on March 27, 2026. The briefing remains ongoing, with DISH’s opposition due April 10, 2026. The Company intends to prosecute its claims and defend against these counterclaims vigorously. The lawsuit is in its early stages, and at this time we cannot reasonably estimate the amount of any potential loss.
The Company, together with, in some instances, certain of its directors and officers, is a defendant in various other legal actions incident to the conduct of its businesses, including streaming services which are subject to patent infringement claims and litigation for which adverse results may include payment of substantial licensing fees and monetary awards, as well as orders preventing us from offering or requiring us to change certain features, functionalities or services, which could harm our businesses and in aggregate negatively impact our results of operations. Management does not believe that the Company has incurred a probable material loss by reason of any of those actions.
Other
The Company entered into license agreements for the sports rights necessary to operate NFL Network and NFL RedZone through 2033.
**13.**Fair Value Measurements
The Company’s assets and liabilities measured at fair value are summarized in the following tables by fair value measurement level:
| Fair Value Measurement at March 28, 2026 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Investments | $ | 24 | $ | 46 | $ | — | $ | 70 | |||||||||||||||
| Derivatives | |||||||||||||||||||||||
| Foreign exchange | — | 753 | — | 753 | |||||||||||||||||||
| Other | — | 24 | — | 24 | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Derivatives | |||||||||||||||||||||||
| Interest rate | — | (736) | — | (736) | |||||||||||||||||||
| Foreign exchange | — | (630) | — | (630) | |||||||||||||||||||
| Other | — | (15) | — | (15) | |||||||||||||||||||
| Other | — | (650) | — | (650) | |||||||||||||||||||
| Total recorded at fair value | $ | 24 | $ | (1,208) | $ | — | $ | (1,184) | |||||||||||||||
| Fair value of borrowings | $ | — | $ | 40,246 | $ | 3,335 | $ | 43,581 |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
| Fair Value Measurement at September 27, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Investments | $ | — | $ | 89 | $ | — | $ | 89 | |||||||||||||||
| Derivatives | |||||||||||||||||||||||
| Foreign exchange | — | 816 | — | 816 | |||||||||||||||||||
| Other | — | 5 | — | 5 | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Derivatives | |||||||||||||||||||||||
| Interest rate | — | (762) | — | (762) | |||||||||||||||||||
| Foreign exchange | — | (926) | — | (926) | |||||||||||||||||||
| Other | — | (1) | — | (1) | |||||||||||||||||||
| Other | — | (668) | — | (668) | |||||||||||||||||||
| Total recorded at fair value | $ | — | $ | (1,447) | $ | — | $ | (1,447) | |||||||||||||||
| Fair value of borrowings | $ | — | $ | 36,976 | $ | 2,111 | $ | 39,087 |
The fair values of Level 2 investments are primarily determined based on an internal valuation model that uses observable inputs such as stock trading price, volatility and risk free rate.
The fair values of Level 2 derivatives are primarily determined by internal discounted cash flow models that use observable inputs such as interest rates, yield curves and foreign currency exchange rates. The Company’s derivative financial instruments are discussed in Note 14.
Level 2 other liabilities are primarily arrangements that are valued based on the fair value of underlying investments, which are generally measured using Level 1 and Level 2 fair value techniques.
Level 2 borrowings, which include commercial paper, U.S. dollar denominated notes and certain foreign currency denominated borrowings, are valued based on quoted prices for similar instruments in active markets or identical instruments in markets that are not active.
Level 3 borrowings include the Asia Theme Parks and cruise ship borrowings, which are valued based on the current estimated borrowing costs, prevailing market interest rates and applicable credit risk.
The Company’s financial instruments also include cash, cash equivalents, receivables and accounts payable. The carrying values of these financial instruments approximate the fair values.
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
**14.**Derivative Instruments
The Company’s derivative positions measured at fair value (see Note 13) are summarized in the following tables:
| As of March 28, 2026 | |||||||||||||||||||||||
| Current Assets | Investments/ Other Assets | Other Current Liabilities | Other Long- Term Liabilities | ||||||||||||||||||||
| Derivatives designated as hedges | |||||||||||||||||||||||
| Foreign exchange | $ | 251 | $ | 335 | $ | (284) | $ | (124) | |||||||||||||||
| Interest rate | — | — | (736) | — | |||||||||||||||||||
| Other | 22 | 2 | (2) | — | |||||||||||||||||||
| Derivatives not designated as hedges | |||||||||||||||||||||||
| Foreign exchange | 102 | 65 | (66) | (156) | |||||||||||||||||||
| Other | — | 70 | (13) | — | |||||||||||||||||||
| Gross fair value of derivatives | 375 | 472 | (1,101) | (280) | |||||||||||||||||||
| Counterparty netting | (325) | (353) | 410 | 268 | |||||||||||||||||||
| Cash collateral (received) paid | — | — | 479 | — | |||||||||||||||||||
| Net derivative positions | $ | 50 | $ | 119 | $ | (212) | $ | (12) |
| As of September 27, 2025 | |||||||||||||||||||||||
| Current Assets | Investments/ Other Assets | Other Current Liabilities | Other Long- Term Liabilities | ||||||||||||||||||||
| Derivatives designated as hedges | |||||||||||||||||||||||
| Foreign exchange | $ | 233 | $ | 376 | $ | (407) | $ | (208) | |||||||||||||||
| Interest rate | — | — | (762) | — | |||||||||||||||||||
| Other | 3 | 2 | — | — | |||||||||||||||||||
| Derivatives not designated as hedges | |||||||||||||||||||||||
| Foreign exchange | 39 | 168 | (49) | (262) | |||||||||||||||||||
| Other | — | 89 | (1) | — | |||||||||||||||||||
| Gross fair value of derivatives | 275 | 635 | (1,219) | (470) | |||||||||||||||||||
| Counterparty netting | (260) | (517) | 378 | 399 | |||||||||||||||||||
| Cash collateral (received) paid | — | — | 550 | 10 | |||||||||||||||||||
| Net derivative positions | $ | 15 | $ | 118 | $ | (291) | $ | (61) |
Interest Rate Risk Management
The Company designates pay-floating interest rate swaps as fair value hedges of fixed-rate borrowings effectively converting fixed-rate borrowings to variable-rate borrowings. The total notional amount of the Company’s pay-floating interest rate swaps was $12.1 billion and $10.6 billion at March 28, 2026 and September 27, 2025, respectively.
The following table summarizes fair value hedge adjustments to hedged borrowings:
| Carrying Amount of Hedged Borrowings | Fair Value Adjustments Included in Hedged Borrowings | ||||||||||||||||||||||
| March 28, 2026 | September 27, 2025 | March 28, 2026 | September 27, 2025 | ||||||||||||||||||||
| Borrowings: | |||||||||||||||||||||||
| Current | $ | 1,906 | $ | 2,954 | $ | (28) | $ | (44) | |||||||||||||||
| Long-term | 9,885 | 7,347 | (687) | (680) | |||||||||||||||||||
| $ | 11,791 | $ | 10,301 | $ | (715) | $ | (724) |
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
The following amounts are included in “Interest expense, net” in the Condensed Consolidated Statements of Income:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Gain (loss) on: | |||||||||||||||||||||||
| Pay-floating swaps | $ | (66) | $ | 187 | $ | 2 | $ | (8) | |||||||||||||||
| Borrowings hedged with pay-floating swaps | 66 | (187) | (2) | 8 | |||||||||||||||||||
| Expense associated with interest accruals on pay-floating swaps | (63) | (98) | (148) | (209) |
Foreign Exchange Risk Management
The Company designates foreign exchange forward and option contracts as cash flow hedges of firmly committed and forecasted foreign currency transactions. As of March 28, 2026 and September 27, 2025, the notional amount of the Company’s net foreign exchange cash flow hedges was $11.0 billion and $9.3 billion, respectively. Mark-to-market gains and losses on these contracts are deferred in AOCI and are recognized in earnings when the hedged transactions occur, offsetting changes in the value of the foreign currency transactions. Net deferred losses recorded in AOCI for contracts that will mature in the next twelve months total $56 million. The following table summarizes the effect of foreign exchange cash flow hedges on AOCI:
| Quarter Ended | Six Months Ended | ||||||||||||||||||||||
| March 28, 2026 | March 29, 2025 | March 28, 2026 | March 29, 2025 | ||||||||||||||||||||
| Gain (loss) recognized in Other Comprehensive Income | $ | 118 | $ | (210) | $ | 93 | $ | 352 | |||||||||||||||
| Gain (loss) reclassified from AOCI into the Statements of Operations(1) | (85) | 121 | (147) | 210 |
(1)Primarily recorded in revenue.
The Company may designate cross currency swaps as fair value hedges of foreign currency denominated borrowings. The impact from the change in foreign currency on both the cross currency swap and borrowing is recorded to “Interest expense, net.” The impact from interest rate changes is recorded in AOCI and is amortized over the life of the cross currency swap. As of both March 28, 2026 and September 27, 2025, the total notional amount of the Company’s designated cross currency swaps was Canadian $1.3 billion ($0.9 billion). The related gains or losses recognized in earnings for the quarters and six-month periods ended March 28, 2026 and March 29, 2025 were not significant.
Foreign exchange risk management contracts with respect to foreign currency denominated assets and liabilities are not designated as hedges and do not qualify for hedge accounting. The net notional amount of these foreign exchange contracts at March 28, 2026 and September 27, 2025 was $2.7 billion and $3.0 billion, respectively. The related gains or losses recognized in costs and expenses on foreign exchange contracts that mitigated our exposure with respect to foreign currency denominated assets and liabilities for the quarters and six-month periods ended March 28, 2026 and March 29, 2025 were not significant.
Risk Management – Other Derivatives Not Designated as Hedges
The Company enters into certain other risk management contracts that are not designated as hedges and do not qualify for hedge accounting. These contracts, which include certain total return swap contracts, are intended to offset economic exposures of the Company and are carried at market value with any changes in value recorded in earnings. The net notional amount of these contracts at both March 28, 2026 and September 27, 2025 was $0.6 billion. The related gains or losses recognized in earnings for the quarters and six-month periods ended March 28, 2026 and March 29, 2025 were not significant.
Contingent Features and Cash Collateral
The Company has master netting arrangements by counterparty with respect to certain derivative financial instrument contracts. The Company may be required to post collateral in the event that a net liability position with a counterparty exceeds limits defined by contract and that vary with the Company’s credit rating. In addition, these contracts may require a counterparty to post collateral to the Company in the event that a net receivable position with a counterparty exceeds limits defined by contract and that vary with the counterparty’s credit rating. If the Company’s or the counterparty’s credit ratings were to fall below investment grade, such counterparties or the Company would also have the right to terminate our derivative contracts, which could lead to a net payment to or from the Company for the aggregate net value by counterparty of our
THE WALT DISNEY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in millions, except for per share data)
derivative contracts. The aggregate fair value of derivative instruments with credit-risk-related contingent features in a net liability position by counterparty was $0.7 billion and $0.9 billion at March 28, 2026 and September 27, 2025, respectively.
**15.**Restructuring and Impairment Charges
The following amounts are recorded in “Restructuring and impairment charges” in the Condensed Consolidated Statements of Income:
The quarter and six-month period ended March 28, 2026 included a $0.1 billion impairment of an equity investment and a $0.1 billion charge for severance.
The quarter ended March 29, 2025 included charges of $0.1 billion related to content impairments. The six-month period ended March 29, 2025 included charges of $0.2 billion related to content impairments and the Star India Transaction.
**16.**New Accounting Pronouncements
Improvements to Income Tax Disclosures
In December 2023, the FASB issued guidance to enhance income tax disclosures. The new guidance requires an expanded effective tax rate reconciliation and the disclosure of cash taxes paid segregated between U.S. federal, U.S. state and foreign, with further disaggregation by jurisdiction if certain thresholds are met, and eliminates certain disclosures related to uncertain tax benefits. The new guidance is applicable to annual periods beginning with the Company’s 2026 fiscal year.
Disaggregation of Income Statement Expense
In November 2024, the FASB issued guidance that requires the disclosure of additional information related to certain costs and expenses, including amounts of inventory purchases, employee compensation, and depreciation and amortization included in each income statement line item. The guidance also requires disclosure of the total amount of selling expenses and the Company’s definition of selling expenses. The guidance is effective for the Company for annual periods beginning in fiscal year 2028 and for interim periods beginning in fiscal year 2029. The Company is currently assessing the impacts of the new guidance on its financial statement disclosures.
Accounting for Government Grants
In December 2025, the FASB issued guidance that establishes the recognition, measurement and presentation requirements for government grants. The guidance is effective at the beginning of the Company’s 2030 fiscal year (with early adoption permitted). The Company is currently assessing the impact this guidance will have on its financial statements and financial statement disclosures.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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