Geetha Ranganathan

Disney reported a strong fiscal Q2 with operating income up 5% (vs. 2% expected), driven by higher per capita spending at parks and pricing power in streaming. Despite a tough economic backdrop and soft attendance, consumers are willing to pay more for the Disney brand and accept price increases across streaming products. The Disney bundle also provides a compelling value proposition, supporting growth. Management pointed to continued strength in H2.

Warner Bros. Discovery's fundamental story is in good shape: management has turned around streaming to profitability, margins have reached about 17% toward a 20% target, and even if the Paramount Skydance deal expires without closing, the company collects a $7 billion termination fee, putting it in a strong position regardless of the merger outcome.

Fox's acquisition of Roku makes a lot of strategic sense because it gives Fox a gateway into streaming, diversifying away from the secular decline in linear TV. Fox gets access to 100 million streaming households (50% of US broadband), the leading connected TV device with a 30% share, and valuable third-party data. The deal helps Fox quadruple its digital advertising revenue and reposition its content where viewers are moving, effectively resetting the narrative around the company.