Disney Reports $33 Million Loss from India JV in Q1 2025, Projects $300 Million Full-Year Loss

The Walt Disney Company reported a $33 million equity loss from its India joint venture (JV) in the first fiscal quarter of 2025, following the deconsolidation of Star India. This marks a significant shift in Disney’s financial reporting, as the company now records only its 37% stake in the newly formed JV with Reliance Industries Limited (RIL), which holds a 56% controlling interest.

Impact on Financials

Disney’s Entertainment segment operating income was $1.7 billion, nearly doubling year-over-year due to improvements in content sales and direct-to-consumer (DTC) streaming. However, the India JV weighed on earnings, with Disney estimating a full-year equity loss of approximately $300 million, primarily due to purchase accounting adjustments.

In Q1, the India business contributed only $73 million to the Entertainment segment’s operating income, compared to $254 million in the prior year when Star India was fully consolidated. Similarly, the Sports segment saw a minor $9 million contribution, a stark contrast to the $636 million loss in FY24, indicating improved performance post-restructuring.

Subscriber & Revenue Trends

Disney+ saw a modest decline in total subscribers, with the platform losing 0.7 million users, bringing its count to 125 million. Advertising revenue for Disney’s DTC services fell by 2%, but when excluding Disney+ Hotstar in India, ad revenue actually grew 16% year-over-year. This highlights the ongoing challenges Disney faces in the Indian market, where Hotstar’s performance continues to lag post the loss of Indian Premier League (IPL) streaming rights.

Strategic Outlook

Looking ahead, Disney projects high-single-digit adjusted EPS growth for FY25 despite the India JV’s losses. The company remains focused on digital expansion, with ESPN integrating into Disney+, and continues to streamline operations in international markets. However, the long-term profitability of the India JV remains uncertain, with further adjustments expected in the coming quarters.

CEO Robert A. Iger acknowledged the evolving landscape, stating, “Our results this quarter demonstrate Disney’s creative and financial strength as we advance our strategic initiatives.” The India restructuring was a major component of this transformation, but its full impact on Disney’s bottom line is yet to be seen.