Disney's Franchise Success Continues: Is Revenue Growth More Durable?

Disney’s DIS franchise-driven strategy is increasingly transforming its revenue base into a more stable and diversified growth engine.

The company is no longer dependent on box office performance alone to drive growth. Instead, Disney is monetizing its intellectual property across streaming, consumer products and Experiences, creating a powerful cross-platform flywheel. Blockbuster titles, such as Lilo & Stitch and Predator: Badlands, generated strong theatrical results while also driving rapid adoption on Disney+ and robust merchandise sales. In the past two years, the company has produced four franchise hits that have each grossed over $1 billion, more than any other studio, highlighting the consistency in franchise output.

Looking ahead, Disney’s deep pipeline of well-established franchises strengthens revenue visibility. Upcoming releases, including Toy Story 5, Avengers: Doomsday, The Mandalorian and Grogu and Avatar: Fire and Ash, are expected to fuel not only theatrical revenues but also streaming engagement and park attractions. As more premium franchise content feeds into Disney’s direct-to-consumer platforms, recurring subscription revenues should further enhance predictability. The acquisition of rights to the Impossible Creatures book series also positions the company to build the next generation of storytelling franchises.

The Experiences division further extends the lifespan of these franchises. Theme park attractions, cruise offerings and global expansion have enabled Disney to monetize intellectual property for many years. Combined with growing international exposure, this strategy broadens both the audience base and the duration of revenue generation. The Zacks Consensus Estimate projects revenue growth of 6.7% for fiscal 2026 and 5% for fiscal 2027, indicating rising stability from franchise-led growth.

Disney Faces Rising Competition in the Franchise-Driven Race

The franchise landscape is growing more competitive, with Warner Bros. Discovery WBD and Netflix NFLX emerging as serious challengers to Disney’s IP strength.

Warner Bros. Discovery is positioning itself as a formidable franchise-driven rival to Disney by rebuilding its studios to box office leadership, relaunching DC with a cohesive long-term roadmap and tightly integrating hit films into HBO Max to drive engagement and profitability. WBD’s emphasis on quality over volume, disciplined IP monetization and rising streaming EBITDA has made WBD a more efficient, creator-led franchise engine that increasingly rivals Disney’s scale.

Netflix is challenging Disney’s franchise-led dominance by building scalable global IP through data-driven content creation, a massive reach of over 325 million paid memberships and strong fandom around originals like Stranger Things and Bridgerton. Unlike Disney’s legacy-centric model, Netflix excels at rapidly launching, localizing and monetizing franchises worldwide, supported by rising operating margins, fast-growing ad revenues and a highly efficient streaming-first ecosystem.

DIS’ Share Price Performance, Valuation & Estimates

Disney shares have fallen 7.8% over the past six months compared with the Zacks Consumer Discretionary sector and the Zacks Media Conglomerates industry’s decline of 7.4% and 12.3%, respectively.

DIS’ Six-Month Price Performance

From a valuation standpoint, DIS stock is currently trading at a forward 12-month price/earnings ratio of 16.22X compared with the industry’s 17.86X. DIS has a Value Score of B.

DIS’ Valuation

According to the Zacks Consensus Estimate, Disney’s earnings are projected at $6.58 per share for fiscal 2026 and $7.31 for fiscal 2027. Estimates for fiscal 2026 are down by a couple of cents over the past 30 days, while fiscal 2027 projections have declined by 4 cents.

DIS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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