Disney Isn't Thinking In Basis Points Anymore — It Wants Margins In 'Chunks'

Author: Surbhi Jain | November 13, 2025 11:20am

Walt Disney Co (NYSE:DIS) CEO Bob Iger spent most of the third quarter earnings call on Thursday walking analysts through Disney's streaming, sports and studio momentum — but the line that stopped the room cold came from CFO Hugh Johnston, who told Wall Street the company isn't chasing incremental efficiencies anymore. "We're looking to gain margin in chunks, not in basis points," he said.

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In a media landscape addicted to soft guidance and hedged promises, Disney just chose swagger.

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DTC Isn't the Only Growth Story — Margin Leverage Is the Real Pivot

The highlight wasn't about subscriber counts or app redesigns — it was about confidence. Johnston said the DTC business will grow the top line at double-digit rates, and those gains will flow through with operating leverage, not cost cuts.

In his words, Disney is done "getting there through cost cutting." Instead, revenue growth, product upgrades and bundle economics are expected to lift profitability in bigger steps.

And that matters. After years of streaming volatility, Disney finally sounds like a company with a margin roadmap that doesn't rely on financial engineering.

Beyond 2026, Disney Sees Scale — Not Squeeze

What made the "chunks" line pop is the long-term framing. Johnston said this margin expansion continues beyond fiscal 2026, positioning Disney's DTC engine as "a terrific business" and "a growth driver for many years to come."

Management isn't telegraphing tweaks around the edges. They're signaling confidence in platform scale — aided by the 80% adoption rate of the Trio bundle, stronger advertising CPMs, and the ESPN app performing "in almost every way."

Why It Matters for Investors

Disney just reframed its future in one sentence. Margin expansion isn't going to trickle in — it's going to arrive in waves. For a company with a decade of choppy transitions behind it, that's the most bullish tone shift yet.

If Disney delivers even half of those "chunks," the stock finally gets a new chapter — one written in operating leverage, not excuses.

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Posted In: DIS