What Is the Current State of Disney? — 2025 Edition

Throughout the 2020s, I’ve taken an annual look back at The Walt Disney Company.

I like to think of it as a year-end review, not unlike those annoying ones you have to do at work.

Those sorts of self-evaluations are wholly worthless, as your boss never looks at them.

Critiquing Disney is a bit different, though, as the company is always watching the internet.

As a rule, Disney tolerates criticism and often even learns from it.

I’d argue that several of the company’s recent improvements occurred after listening to feedback. With that in mind, what is the current state of Disney at the end of 2025?

Disney = Sisyphus

Before we get started with 2025, here were my thoughts from 2022, 2023, and 2024.

I like this as a story arc, as the 2022 article was published less than two weeks after Bob Iger’s return.

So, the chaos of Disney firing a CEO and replacing him with the former boss was still thick in the air.

At the time, Disney’s stock had fallen into the low-$80s, which sounds really bad.

However, I’ll remind you that Disney stock dropped into that same range at one point in early 2025.

The threatened international tariffs impacted some companies more than others.

Disney sadly slotted toward the top of that list, and investors adjusted expectations accordingly.

Still, the fact that Disney fell that low tells you the last three years have been up and down.

As I type this, Disney’s stock hovers around $111, with most analysts describing it as overweight.

That’s a Wall Street term for an underpriced stock that holds more value than the stock price would indicate.

In other words, the people who follow the industry believe Disney stock should do better in the future.

That’s a great sign for 2026 and beyond at Disney, but it’s also an indictment of recent years.

Disney has become the Wall Street equivalent of Sisyphus and the rock.

Just as Iger pushes the rock up to the top of the hill, it inevitably slides back down again.

Linear on the Brink

We learned this recently when Disney seemed to be hitting on all cylinders.

Then, in a matter of weeks, Jimmy Kimmel told an unpopular joke and YouTube TV picked a fight.

Suddenly, Disney faced yet another onslaught of negative headlines, which has been the company’s fate in the 2020s.

Really, since Shanghai Disneyland closed for the pandemic in January 2020, it’s been like that for Disney.

Every time something good happens, it seems like something bad follows soon afterward.

Disney enjoyed a good run during the second half of 2024 through the first half of 2025.

Sure, the company experienced a few hiccups like Snow White, but that’s to be expected.

No media business ever bats 1.000 with its content. Failures are a cost of doing business.

What mattered the most throughout 2025 was that its core divisions primarily improved.

Disney tracked one glaring, albeit expected exception: the drastic decline of Linear Networks.

While still profitable, this division’s operating income fell 14 percent to $2.9 billion in fiscal 2025.

More importantly, Disney’s conventional broadcast programming declined by $497 million in operating income.

At that rate of decline, Disney will lose money on network television by the end of fiscal 2031.

I view that as a worst-case scenario result, as this core is still earning $9.36 billion annually.

So, Disney can cut corners here as needed to keep linear profitable into the 2030s.

Disney at the Crossroads

After that is anyone’s guess, as the proposed Warner Bros. Discovery acquisition has introduced chaos.

At this point, the owners of two of the former television networks appear likely to merge.

My best guess right now is Comcast/NBC merging Paramount/CBS, but nothing is certain.

Should Netflix acquire WBD, it wouldn’t get the cable channels like TBS and TNT.

Those would spin off into an entity that would likely merge with NBC’s spinoff, Versant.

As one of the players involved with this mess, Disney is left wondering who gets what.

That’s just on the mergers and acquisitions side. We also have the affiliates to consider.

Thus far, the lobbying request to allow network affiliates to own more stations hasn’t moved forward.

However, we’ve already witnessed Sinclair and Nexstar trying to throw their weight around with Disney.

The affiliates feel more empowered than ever, which is why they were so chesty in 2025.

In short, Disney’s making less money than ever with its Linear Networks while the headaches grow larger.

That’s why I remain convinced that Disney will ditch Linear at some point, even as Iger says no.

Remember that he’s leaving soon, which is part of what makes the current state of Disney so fascinating.

Iger’s deals with Epic Games and OpenAI aren’t ones he’ll be around to watch unfold.

That task will fall on his successor, who is presumably one of Josh D’Amaro, Dana Walden, or both.

Until Disney finally names its next leader, it’ll remain in a kind of purgatory.

Stuck in the Upper Middle Class

As soon as someone else takes over, they’ll want to put their own stamp on Disney.

You can expect a few big swings when that happens…but here’s the thing.

A year from now, when I write the 2026 version of this article, that person STILL won’t be in charge.

The current plans call for Iger to retire on New Year’s Eve 2026.

That sure seems like another year spent in purgatory, albeit one where Disney makes progress.

Hollywood and Wall Street alike are currently debating Disney’s recent foray into AI.

That’s a move borne out of necessity, one that could provide dividends OR prove disastrous.

There’s not really an in-between here, as Disney is willingly ceding control of its precious IP.

Tens of millions of people on the internet can generate officially licensed videos of Disney characters in 2026.

Disney has spent generations carefully guarding its brands and characters.

Even the arrival of Mickey Mouse in the public domain only occurred after decades of lobbying.

Suddenly, Disney has reversed its position and allowed literally EVERYONE to use its IP.

That’s a swing for the fences that may lead to a Freddie Freeman moment…or the end of Casey at the Bat.

One scenario creates an indelible image of heroism. The other leads to a stunned stadium of broken-hearted fans.

Make no mistake on the point. This OpenAI deal can go very, VERY wrong.

Disney wouldn’t be making it if the company had any other choice, but that’s where it’s at right now.

These monolithic tech companies with massive valuations can bully businesses like Disney.

They were going to use Disney characters for this sort of AI animation, with or without approval. So, Disney at least held out for a stake in a business it really doesn’t know at all.

The Good News…and Plenty of It

I realize I sound a bit glum, but I’m generally bullish about Disney’s prospects for 2026 and beyond.

I consider the Epic Games collaboration a masterstroke and am hopeful about OpenAI.

More importantly, I realize Disney didn’t have any choice here, as this was happening anyway.

When I look at Disney’s other cores, I’m in awe of how far the company has come in a short time.

In my 2023 State of Disney piece, I predicted a mediocre 2024, which thankfully didn’t happen.

Disney has strengthened its previous weakness, streaming, into an emerging strength.

The company projected $1 billion in operating income in this division in fiscal 2025.

Remarkably, Direct-to-Consumer beat that estimate by nearly 33 percent.

From a monetization perspective, Disney is absolutely killing it right now.

During the fiscal year, Disney reported operating income of $17.55 billion, an improvement of $1.95 billion in a year.

Disney Experiences, the division you and I care about the most, reached $10 billion on its own.

Well, technically, it was $9.995 billion in profit, and that’s before the inclusion of two new cruise ships.

With the Disney Destiny and the Disney Adventure dramatically expanding Disney’s cruise capacity, those numbers will surge in fiscal 2026 and beyond.

When I look at the books, I just don’t see much bad news for Disney.

The money’s safe, barring a catastrophic economic crisis, and if one of those happens, it won’t be Disney we’re all worrying about, will it?

What Is the Current State of Disney?

The concerns stem from the other stuff, as Disney keeps dragged into PR headaches.

Whether it’s politics, the dangers of AI, or complaints from Star Wars/Marvel fans, the noise seems constant.

Disney keeps getting dragged into very public brouhahas, which leads to weird outcomes.

For instance, countless people canceled Disney+ to protest a talk show decision.

That’s literally millions of dollars swinging over something largely beyond Disney’s control.

Disney’s problem isn’t financial, which means it needs to focus more on the PR battle.

The next CEO of Disney needs to prioritize messaging, as Iger appears to have solved the money problem.

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