Disney Licenses Select Content to Netflix in Limited Deal

Disney (DIS) has struck a deal with Netflix to license a selection of its movies and TV shows. The agreement, announced on Friday, includes content like the first two seasons of Percy Jackson and the Olympians, all five Ice Age films, and Disney and Pixar titles such as Soul and Raya and the Last Dragon. Most of these titles will be available on Netflix for a limited time, with some, like the Disney and Pixar films, arriving in early 2027.

Despite this licensing deal, Disney has emphasized that its major brands will remain exclusive to its own platforms. CEO Josh D’Amaro noted on the August earnings call that while some content licensing occurs, relying solely on it could hurt Disney’s strategy and finances. The company reported strong financials last quarter, with total revenue growing 7% and segment operating income rising 21%. Streaming also posted a 13% operating margin, and management expects double-digit margins for the full year.

The parks segment continues to drive growth, with experiences revenue hitting $10 billion, up 10%, and global guests increasing by 4%. Disney has also increased its share buyback plan to at least $9 billion this year, up from $7 billion. Investors are watching to see if more licensing deals follow, but the stock’s performance will likely hinge more on parks growth, streaming margins, and upcoming film releases.

As of October 2, Disney stock (DIS) was priced at $102, with a 52-week high of $117 and a price target of $127. The deal with Netflix appears to be a short-term move that doesn’t significantly alter Disney’s long-term streaming strategy.