Disney posted a stronger-than-expected quarter and used the moment to signal where the company is heading next: a free, ad-supported streaming service, steady content spending, and more job cuts to pay for growth.

Adjusted earnings per share reached $2.06 for the June 2026 quarter, up 28% from a year earlier and well above the $1.86 analysts had forecast, Reuters reported. Toy Story 5 helped drive the quarter, lifting both the streaming business and merchandise sales. Disney released its fiscal third-quarter results before markets opened on August 5, 2026, as previously announced.

On the earnings call, Disney CEO Josh D'Amaro confirmed the company is exploring a FAST product — free, ad-supported streaming television, the kind of service that runs scheduled or on-demand channels without a subscription fee, Deadline reported. Disney already offers ad-supported tiers on Disney+ and Hulu. A fully free service would be a new step, reaching viewers who will not pay a monthly fee but will watch commercials.

CFO Hugh Johnston told the call that Disney is on track for roughly $24 billion in content spending in fiscal 2026, a modest increase from fiscal 2025, and that spending will continue to grow over time with international markets cited as an opportunity. That money has to come from somewhere. Johnston said Disney is pursuing meaningful cost reductions, including in labour and in SG&A — selling, general and administrative expenses, the overhead that covers everything from corporate staffing to office operations.

Disney cut several hundred jobs in July 2026, following an earlier round of layoffs earlier in the year. In April, D'Amaro announced plans to eliminate about 1,000 positions in an email to employees as part of streamlining the company, Reuters reported.

The company is also redirecting capital. Disney's anticipated share repurchase programme for fiscal 2026 rose to $9 billion, funded in part by cash set aside for a scrapped $1 billion OpenAI investment and $1.2 billion expected from the A&E transaction, Deadline reported. Share buybacks reduce the number of shares outstanding, which can lift the stock price — and Disney's shares have already been moving. The stock rose 7.5% after the company beat estimates in its previous quarter in May 2026, Reuters reported.

For the people who make Disney's shows and films, the content-spending number matters more than the stock ticker. A $24 billion budget keeps writers' rooms, production crews and animation studios working — while the cost cuts that fund it keep the pressure on everyone above the line.