Shares in Disney (DIS) stock have tanked by as much as 9% on Thursday after the company’s Q4 earnings and revenue fell flat of Wall Street forecasts. The entertainment giant reported roughly flat revenues of $22.46 billion in its fourth quarter that ended in late September, short of Wall Street analysts’ expectations. Additionally, its companywide segment operating income fell 5% to $3.48 billion.

Direct-to-consumer revenue grew 8% last quarter to $6.25 billion. Operating income for the segment rose 39% to $352 million, nearly matching the $391 million profit from linear networks, which fell 21%.

Since 2022, Disney has seen its stock stagnate in value at a $100 average, after hitting $200 the year prior. Despite consistent profit growth, investors remain worried about Disney’s ability to manage the transition from linear television to streaming. Plus, the entertainment giant is still working to properly execute on the multibillion-dollar investments it is making in theme parks and cruise ships.

Also Read: Quantum Computing (QUBT): Wall Street Sees 100% Upside Ahead

Furthermore, the company is now focusing on what it said were strong prospects for its streaming business. Iger said on a call with analysts that he sees Disney+ as not just a growing content platform, but as a way to use artificial intelligence to let people shop for products, engage with theme parks and cruise ships, play games, and produce and consume user-generated content based on Disney properties. The AI bubble has blown up in 2025, with several top US companies looking for their slice of the pie. “The opportunity here is enormous in terms of increasing our engagement with Disney fans,” Iger said. Therefore, it’s not a surprise to hear that Disney is looking to get in on the action as well.

In terms of guidance for the near future, the company said it expects profitability in its streaming business to grow to 10% in the current fiscal year from about 5% in fiscal 2025. Still, investors are concerned about the company’s ability to navigate mixed box office results and distribution disputes. Analysts generally see upside potential for Disney (DIS) stock, with several major firms maintaining a Buy rating and price targets above the current $116.65 level, including Bank of America. However, a return to beyond the $200 remains a distant dream.