Disney beats estimates as combined streaming services turn a profit

Disney reported its fiscal third-quarter earnings Wednesday, topping analyst estimates as its combined streaming businesses turned a profit earlier than expected.

Here is what Disney reported compared with what Wall Street expected, according to LSEG:

The company's total segment operating income increased 19% to $4.225 billion compared with the same period last year, led by the positive results for Disney's entertainment unit, particularly streaming. 

Disney's combined streaming business, which consists of Disney+, Hulu and ESPN+, together turned a profit for the first time — and it happened a quarter earlier than the company had expected.

The combined streaming business posted an operating profit of $47 million compared with a loss of $512 million in the same quarter last year. However, without ESPN+, the direct-to-consumer streaming unit reported a loss of $19 million.

Meanwhile, in May, Disney highlighted a slightly different metric, noting that Disney+ and Hulu together turned a profit, but when combined with ESPN+, the streaming businesses suffered a loss.

Disney recently changed how it reports its segments, with ESPN falling under its sports unit, and Disney+ and Hulu being counted as part of the direct-to-consumer entertainment segment. Disney and its peers have been focused on streaming reaching profitability as the traditional TV business bleeds customers.

Disney+ Core subscribers — which excludes Disney+ Hotstar in India and other countries in the region —increased by 1% to 118.3 million, despite the company's earlier guidance it wouldn't addnew customers during the fiscal third quarter. Total Hulu subscribers grew 2% to 51.1 million.

Revenue for the entertainment segment was up 4% to $10.58 billion, driven largely by