GRADED TEAM CASE 2

FIN 201 – Business Economics

Prof. S. Ahn

DELIVERABLES: - Peer grades emailed to [email protected]

- Written report uploaded into CANVAS Assignments folder

DEADLINE: March 28, 2023 before the start of scheduled class time

INSTRUCTIONS: Form a team of three to six people and answer the case prompt
below in a written report. See also course syllabus for original
instructions. You should review this document electronically before
deciding which, if any, pages to physically print.

GUIDELINES: Create a logical, compelling, fact-driven, methodology using

cumulative course content to answer the case prompt below based
on only the accompanying materials.

A strong “A-grade” case study analysis report will:

- be well organized with a structured compelling methodology
- be 8 – 10 pages including graphs and bibliography; MLA or
CMOS standards not required
- use graphs to illustrate compelling points
- creatively and logically apply most of the key economic concept
tools we have covered in class

CASE PROMPT: Evaluate Disney’s condition and performance from a business

economics perspective and identify areas for improvement.
FISCAL YEAR 2022 ANNUAL FINANCIAL REPORT
 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended October 1, 2022
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________.
Commission File Number 001-38842

Delaware 83-0940635
State or Other Jurisdiction of I.R.S. Employer Identification
Incorporation or Organization
500 South Buena Vista Street
Burbank, California 91521
Address of Principal Executive Offices and Zip Code
(818) 560-1000
Registrant’s Telephone Number, Including Area Code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $0.01 par value DIS New York Stock Exchange

Securities Registered Pursuant to Section 12(g) of the Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No x
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and
“emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer x Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with
any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm
that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x
The aggregate market value of common stock held by non-affiliates (based on the closing price on the last business day of the registrant’s most
recently completed second fiscal quarter as reported on the New York Stock Exchange-Composite Transactions) was $249.5 billion. All executive
officers and directors of the registrant and all persons filing a Schedule 13D with the Securities and Exchange Commission in respect to registrant’s
common stock have been deemed, solely for the purpose of the foregoing calculation, to be “affiliates” of the registrant.
There were 1,823,591,988 shares of common stock outstanding as of November 16, 2022.
Documents Incorporated by Reference
Certain information required for Part III of this report is incorporated herein by reference to the proxy statement for the 2023 annual meeting of
the Company’s shareholders.
 THE WALT DISNEY COMPANY AND SUBSIDIARIES

TABLE OF CONTENTS

Page
PART I

ITEM 1. Business 2

ITEM 1A. Risk Factors 19

ITEM 1B. Unresolved Staff Comments 28

ITEM 2. Properties 28

ITEM 3. Legal Proceedings 28

ITEM 4. Mine Safety Disclosures 29

Information About our Executive Officers 29

PART II

ITEM 5. Market for the Company’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities 30

ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 31

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 53

ITEM 8. Financial Statements and Supplementary Data 54

ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 54

ITEM 9A. Controls and Procedures 54

ITEM 9B. Other Information 55

ITEM 9C Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 55

PART III

ITEM 10. Directors, Executive Officers and Corporate Governance 56

ITEM 11. Executive Compensation 56

ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 56

ITEM 13. Certain Relationships and Related Transactions, and Director Independence 56

ITEM 14. Principal Accounting Fees and Services 56

PART IV

ITEM 15. Exhibits and Financial Statement Schedules 57

ITEM 16. Form 10-K Summary 61

SIGNATURES 62

Consolidated Financial Information — The Walt Disney Company 63

Cautionary Note on Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements generally relate to future events or our future financial or operating performance and may include statements
concerning, among other things, financial results, business plans (including statements regarding new services and products and
future expenditures, costs and investments), future liabilities, impairments and amortization, competition, and the impact of
COVID-19 on our businesses and results of operations. In some cases, you can identify forward-looking statements because
they contain words such as “may,” “will,” “would,” “should,” “expects,” “plans,” “could,” “intends,” “target,” “projects,”
“believes,” “estimates,” “anticipates,” “potential” or “continue” or the negative of these words or other similar terms or
expressions that concern our expectations, strategy, plans or intentions. These statements reflect our current views with respect
to future events and are based on assumptions as of the date of this report. These statements are subject to known and unknown
risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different
from expectations or results projected or implied by forward-looking statements.
Such differences may result from actions taken by the Company, including restructuring or strategic initiatives (including
capital investments, asset acquisitions or dispositions, new or expanded business lines or cessation of certain operations), our
execution of our business plans (including the content we create and IP we invest in, our pricing decisions and our cost
structure) or other business decisions, as well as from developments beyond the Company’s control, including:
• further deterioration in domestic and global economic conditions;
• deterioration in or pressures from competitive conditions, including competition to create or acquire content;
• consumer preferences and acceptance of our content, offerings, pricing model and price increases and the market for
advertising sales on our direct-to-consumer services and linear networks;
• health concerns and their impact on our businesses and productions;
• international, regulatory, legal, political, or military developments;
• technological developments;
• labor markets and activities;
• adverse weather conditions or natural disasters; and
• availability of content;
each such risk includes the current and future impacts of, and is amplified by, COVID-19 and related mitigation efforts.
Such developments may further affect entertainment, travel and leisure businesses generally and may, among other things,
affect (or further affect, as applicable):
• our operations, business plans or profitability;
• demand for our products and services;
• the performance of the Company’s content;
• our ability to create or obtain desirable content at or under the value we assign the content;
• the advertising market for programming;
• income tax expense; and
• performance of some or all Company businesses either directly or through their impact on those who distribute our
products.
Additional factors include those described in this Annual Report on Form 10-K, including under the captions “Risk
Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Business,” in our
subsequent quarterly reports on Form 10-Q, including under the captions “Risk Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations,” and in our subsequent filings with the Securities and Exchange
Commission.
A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances. You should not
place undue reliance on the forward-looking statements. Unless required by federal securities laws, we assume no obligation to
update any of these forward-looking statements, or to update the reasons actual results could differ materially from those
anticipated, to reflect circumstances or events that occur after the statements are made.

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 PART I

ITEM 1. Business
The Walt Disney Company, together with its subsidiaries, is a diversified worldwide entertainment company with
operations in two segments: Disney Media and Entertainment Distribution (DMED) and Disney Parks, Experiences and
Products (DPEP).
The terms “Company”, “we”, “our” and “us” are used in this report to refer collectively to the parent company and the
subsidiaries through which businesses are conducted.
COVID-19 Pandemic
Since early 2020, the world has been, and continues to be, impacted by the novel coronavirus (COVID-19) and its
variants. COVID-19 and measures to prevent its spread have impacted our segments in a number of ways, most significantly at
DPEP where our theme parks and resorts were closed and cruise ship sailings and guided tours were suspended. In addition, at
DMED we delayed, or in some cases, shortened or cancelled theatrical releases and experienced disruptions in the production
and availability of content. Operations have resumed at various points since May 2020, with certain theme park and resort
operations and film and television productions resuming by the end of fiscal 2020 and throughout fiscal 2021. Although
operations resumed, many of our businesses continue to experience impacts from COVID-19, such as incremental health and
safety measures and related increased expenses, capacity restrictions and closures (including at some of our international parks
and in theaters in certain markets), and disruption of content production activities.
The impact of COVID-19 related disruptions on our financial and operating results will be dictated by the currently
unknowable duration and severity of COVID-19 and its variants, and among other things, governmental actions imposed in
response to COVID-19 and individuals’ and companies’ risk tolerance regarding health matters going forward. We have
incurred and will continue to incur additional costs to address government regulations and the safety of our employees, guests
and talent.
Human Capital
The Company’s key human capital management objectives are to attract, retain and develop the highest quality talent. To
support these objectives, the Company’s human resources programs are designed to develop talent to prepare them for critical
roles and leadership positions for the future; reward and support employees through competitive pay, benefit, and perquisite
programs; enhance the Company’s culture through efforts aimed at making the workplace more engaging and inclusive; acquire
talent and facilitate internal talent mobility to create a high-performing, diverse workforce; engage employees as brand
ambassadors of the Company’s content, products and experiences; and evolve and invest in technology, tools, and resources to
enable employees at work.
The Company employed approximately 220,000 people as of October 1, 2022, of which approximately 166,000 were
employed in the U.S. and approximately 54,000 were employed internationally. Our global workforce is comprised of
approximately 78% full time and 15% part time employees, with another 7% being seasonal employees. A significant number
of employees in various parts of our businesses, including employees of our theme parks, and writers, directors, actors and
production personnel for our productions are covered by collective bargaining agreements. In addition, some of our employees
outside the U.S. are represented by works councils, trade unions or other employee associations.
Some of our key programs and initiatives to attract, develop and retain our diverse workforce include:
• Diversity, Equity, and Inclusion (DE&I): Our DE&I objectives are to build teams that reflect the life experiences of
our audiences, while employing and supporting a diverse array of voices in our creative and production teams. Our
DE&I initiatives and programs include:
◦ The Company’s Reimagine Tomorrow efforts, which build on Disney’s longstanding commitment to diversity,
equity and inclusion, and features a website, Disney’s first large-scale platform for amplifying underrepresented
voices
◦ Executive Incubator, Creative Talent Development and Inclusion, and the Disney Launchpad: Shorts Incubator,
which are designed to create a pipeline of next-generation creative executives from underrepresented backgrounds
◦ Development programs, which target underrepresented talent
◦ Innovative learning opportunities, which spark dialogue among employees, leaders, Disney talent and external
experts
◦ Over 100 employee-led Business Employee Resource Groups (BERGs), which represent and support the diverse
communities that make up our workforce
◦ The Disney Look appearance guidelines, which were updated to cultivate a more inclusive environment that
encourages and celebrates authentic expressions of belonging among employees

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 • Health, wellness, family resources, and other benefits: Disney’s benefit offerings are designed to meet the varied
and evolving needs of a diverse workforce across businesses and geographies while helping our employees care for
themselves and their families. We provide:
◦ Healthcare options aimed at improving quality of care while limiting out-of-pocket costs
◦ Family care resources, such as childcare programs for employees, including access to onsite/community centers,
enhanced back-up care choices to include personal caregivers, childcare referral assistance and center discounts,
homework help, a variety of parenting educational resources and a family building benefit supporting fertility
treatments, adoptions or surrogacy
◦ Free mental and behavioral health resources, including on-demand access to the Employee Assistance Program for
employees and their dependents
◦ Two Centers for Living Well that offer convenient, on-demand access to board-certified physicians and counselors
◦ A multi-layered response to COVID-19, including testing and treatment under all Company medical plans at no
cost to employees and dependents
◦ Global Well-Being Week (introduced in 2022), a dedicated week for employees around the world to celebrate,
learn and engage in well-being through in-person and virtual events and activities focused on physical, emotional,
financial, and social well-being
• Disney Aspire: We support the long-term career aspirations of our hourly employees and further our commitment to
strengthening the communities in which we work through our education investment program, Disney Aspire. We pay
100% of the tuition costs upfront for participating employees at a variety of in-network learning providers and
universities and reimburse employees for applicable books and fees. The program helps our employees achieve their
goals professionally - whether at Disney or beyond - by equipping them with the skills they need to succeed in the
rapidly changing 21st century career landscape. More than 16,000 current employees have enrolled in or graduated
from a Disney Aspire program, and more than two-thirds of our program graduates have earned an Associate,
Bachelor’s or Master’s degree.
• Talent Development: We prioritize and invest in creating opportunities to help employees grow and build their
careers through a multitude of training and development programs. These include online, instructor-led and on-the-job
learning formats as well as executive talent and succession planning paired with an individualized development
approach.
• Social Responsibility and Community: The Company’s longstanding commitment to Corporate Social
Responsibility (CSR) helps differentiate the Company as an employer. In 2021, we refreshed our CSR strategy to
connect it more closely with the Company’s mission and commercial offerings and environmental and social
opportunities relevant to our business and employees. Our CSR priorities include diversity, equity, and inclusion;
environmental stewardship and conservation; giving back to our communities with a special focus on supporting
children and families; human capital management; and operating responsibly. The strategy provides a path to
embedding these CSR priorities into our offerings and operations in addition to our philanthropy. The Company also
supports employees who give back to our communities with a generous matching gifts program and a unique
employee volunteering program, Disney VoluntEARS, which rewards volunteer hours with the opportunity to direct
not-for-profit donations by the Company.
Environmental and Sustainability
The Company has developed measurable environmental and sustainability goals for 2030, grounded in science and an
assessment of where the Company’s operations have the most significant impact on the environment, as well as the areas where
it can most effectively mitigate that impact. These goals include, among others, achieving net zero Scope 1 and 2 greenhouse
gas emissions for our direct operations, and zero waste to landfill at our wholly owned and operated parks and resorts by 2030.

DISNEY MEDIA AND ENTERTAINMENT DISTRIBUTION

DMED encompasses the Company’s global film and episodic television content production and distribution activities.
Content is distributed by a single organization across three significant lines of business: Linear Networks, Direct-to-Consumer
and Content Sales/Licensing. Content is generally created/licensed by four groups: Studios, General Entertainment, Sports and
International. The distribution organization has full accountability for the financial results of the entire media and entertainment
business.

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The operations of DMED’s significant lines of business are as follows:
• Linear Networks
◦ Domestic Channels: ABC Television Network (ABC) and eight owned ABC television stations (Broadcasting), and
Disney, ESPN, Freeform, FX and National Geographic branded domestic television networks (Cable)
◦ International Channels: Disney, ESPN, Fox, National Geographic and Star branded television networks outside of
the U.S.
◦ A 50% equity investment in A+E Television Networks (A+E), which operates a variety of cable channels including
A&E, HISTORY and Lifetime
• Direct-to-Consumer
◦ Disney+, Disney+ Hotstar, ESPN+, Hulu and Star+ direct-to-consumer (DTC) video streaming services
• Content Sales/Licensing
◦ Sale/licensing of film and television content to third-party television and subscription/advertising video-on-demand
(TV/SVOD) services
◦ Theatrical distribution
◦ Home entertainment distribution (DVD, Blu-ray discs and electronic home video licenses)
◦ Music distribution
◦ Staging and licensing of live entertainment events on Broadway and around the world (Stage Plays)
DMED also includes the following activities that are reported with Content Sales/Licensing:
• Post-production services by Industrial Light & Magic and Skywalker Sound
• National Geographic magazine and online business
• A 30% ownership interest in Tata Play Limited (formerly Tata Sky Limited), which operates a direct-to-home satellite
distribution platform in India
The significant revenues of DMED are as follows:
• Affiliate fees - Fees charged by our Linear Networks to multi-channel video programming distributors (i.e. cable,
satellite, telecommunications and digital over-the-top (e.g. YouTube TV) service providers) (MVPDs) and television
stations affiliated with ABC for the right to deliver our programming to their customers
• Subscription fees - Fees charged to customers/subscribers for our DTC streaming services
• Advertising - Sales of advertising time/space at Linear Networks and Direct-to-Consumer
• TV/SVOD distribution - Licensing fees and other revenue for the right to use our film and television productions and
revenue from fees charged to customers to view our sports programming (“pay-per-view”) and fees for streaming
access to films that are also playing in theaters (“Premier Access”). TV/SVOD distribution revenue is primarily
reported in Content Sales/Licensing, except for pay-per-view and Premier Access revenues, which are reported in
Direct-to-Consumer.
• Theatrical distribution - Rentals from licensing our film productions to theaters
• Home entertainment - Sales of our film and television content to retailers and distributors in home video formats
• Other content sales/licensing revenue - Revenues from licensing our music, ticket sales from stage play performances
and fees from licensing our intellectual properties (“IP”) for use in stage plays
• Other revenue - Fees from sub-licensing of sports programming rights (reported in Linear Networks) and sales of post-
production services (reported with Content Sales/Licensing)
The significant expenses of DMED are as follows:
• Operating expenses consist primarily of programming and production costs, technical support costs, operating labor,
distribution costs and costs of sales. Programming and production costs include amortization of licensed programming
rights (including sports rights), amortization of capitalized production costs, subscriber-based fees for programming
our Hulu services, production costs related to live programming such as news and sports and amortization of
participations and residual obligations. Programming and production costs also include fees paid to Linear Networks
from other DMED businesses for the right to air our linear networks and related services. These costs are largely
incurred across four content creation/licensing groups, as follows:
◦ Studios - Primarily capitalized production costs related to films produced under the Walt Disney Pictures,
Twentieth Century Studios, Marvel, Lucasfilm, Pixar and Searchlight Pictures banners

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 ◦ General Entertainment - Primarily internal production of and acquisition of rights to episodic television programs
and news content. Internal content is generally produced by the following television studios: ABC Signature; 20th
Television; Disney Television Animation; FX Productions; and various studios for which we commission
productions for our branded channels and DTC streaming services
◦ Sports - Primarily acquisition of professional and college sports programming rights and related production costs
◦ International - Primarily internal production of and acquisition of rights to local content outside the U.S. and
Canada
• Selling, general and administrative costs, including marketing costs
• Depreciation and amortization

Media and Entertainment Distribution Strategy

The Company has significantly increased its focus on distribution of content via our own DTC streaming services relative
to traditional distribution of content. In general, film content was traditionally distributed first in the theatrical market, followed
by the home entertainment market and then in the TV/SVOD market. In general, episodic television content was traditionally
launched on our domestic linear networks and licensed for use globally in other TV/SVOD windows. Although the Company
continues to monetize a significant amount of its content in the traditional manner, our focus on our own DTC distribution has
had a number of impacts including but not limited to:
• in some cases, we are producing exclusive content for our DTC streaming services;
• rather than selling our content in the TV/SVOD market, we generally distribute it on our DTC streaming services; and
• in part because of the impact of COVID-19 on theatrical markets around the world, we may alter our traditional
theatrical distribution approach, for example by making a film available on our DTC streaming services at the same
time it is in theaters or shortly thereafter (e.g. Premier Access).
Over time, all else being equal, these impacts will tend to increase revenue and costs at Direct-to-Consumer and reduce
revenue and costs at Content Sales/Licensing and Linear Networks. Our distribution approach is based on flexibility in our
windowing strategy, and we may change our original launch and distribution strategy for any particular piece of content.
Distribution decisions may impact revenues and viewership, and the allocation of costs to our businesses/distribution platforms,
particularly programming, production and marketing costs, depends on the distribution approach.
A more detailed discussion of our distribution businesses and production groups follows.

Linear Networks
The majority of Linear Networks revenue is derived from affiliate fees and advertising sales. The Company’s linear
networks businesses provide programming under multi-year licensing agreements with MVPDs and/or affiliated television
stations that are generally based on contractually specified rates on a per subscriber basis. The amounts that we can charge to
MVPDs for our networks is largely dependent on the quality and quantity of programming that we can provide and the
competitive market for programming services. The ability to sell advertising time and the rates received are primarily dependent
on the size and nature of the audience that the network can deliver to the advertiser as well as overall advertiser demand.
Linear Networks consist of our domestic and international branded television channels.
Domestic Channels
Our domestic channels include Cable operations comprising Disney, ESPN, Freeform, FX and National Geographic
branded channels and Broadcasting operations comprising ABC and eight owned ABC affiliated television stations.
Cable
Disney Channels
Branded television channels include: Disney Channel; Disney Junior; and Disney XD (collectively Disney Channels).
Disney Channel - the Disney Channel airs original series and movie programming 24 hours a day targeted to kids ages 2
to 14. The channel features live-action comedy series, animated programming and preschool series as well as original movies
and theatrical films.
Disney Junior - the Disney Junior channel airs programming 24 hours a day targeted to kids ages 2 to 7 and their parents
and caregivers. The channel features animated and live-action programming that blends Disney’s storytelling and characters
with learning. Disney Junior also airs as a programming block on the Disney Channel.
Disney XD - the Disney XD channel airs programming 24 hours a day targeted to kids ages 6 to 11. The channel features a
mix of live-action and animated programming.

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ESPN
Branded television channels include eight 24-hour domestic television sports channels: ESPN and ESPN2 (both of which
are dedicated to professional and college sports as well as sports news and original programming); ESPNU (which is dedicated
to college sports); ESPNEWS (which re-airs select ESPN studio shows and airs a variety of other programming); SEC Network
(which is dedicated to Southeastern Conference college athletics); Longhorn Network (which is dedicated to The University of
Texas athletics); ESPN Deportes (which airs professional and college sports as well as studio shows in Spanish); and ACC
Network (which is dedicated to Atlantic Coast Conference college athletics). In addition, ESPN programs the sports schedule
on ABC, which is branded ESPN on ABC.
ESPN also includes the following:
• ESPN.com, which delivers sports news, information and video on internet-connected devices, with approximately 20
editions in five languages globally. In the U.S., ESPN.com also features live video streams of ESPN channels to
authenticated MVPD subscribers. Non-subscribers have limited access to certain content.
• ESPN app, which is an all-in-one sports content platform, serving fans with a personalized digital destination on
streaming devices. The app content includes news, highlights and real-time interactive features, including real-time
scores, play-by-play and fantasy sports scores. ESPN+ subscribers can access the ESPN+ content from the app. In the
U.S., the app also features live video streams of ESPN’s linear channels and exclusive events to authenticated MVPD
subscribers. Non-subscribers have limited access to certain content.
• ESPN Radio, which is the largest sports radio network in the U.S. In fiscal 2022, the Company sold its four owned
radio stations for an amount that was not material.
In addition, ESPN owns and operates the following events: ESPYs (annual awards show); X Games (winter and summer
action sports competitions), which were sold in October 2022 for an amount that was not material; and a portfolio of collegiate
sporting events including: football bowl games, basketball games, softball games and post-season award shows.
ESPN is owned 80% by the Company and 20% by Hearst Corporation (Hearst).
Freeform
Freeform is a channel targeted to viewers ages 18 to 34 that airs original, Company owned (“library”) and licensed
television series, films and holiday programming events.
FX Channels
Branded general entertainment television channels include: FX; FXM; and FXX (collectively FX Channels), which air a
mix of original, library and licensed television series and films.
National Geographic Channels
Branded television channels include: National Geographic; Nat Geo Wild; and Nat Geo Mundo (collectively National
Geographic Channels). National Geographic Channels air scripted and documentary programming on such topics as natural
history, adventure, science, exploration and culture.
National Geographic, including the magazine and online business reported in Content Sales/Licensing, is owned 73% by
the Company and 27% by the National Geographic Society.

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 The number of subscribers (in millions) for the Company’s significant domestic cable channels are as follows:
Subscribers(1)
Disney
Disney Channel 74
Disney Junior 54
Disney XD 53
ESPN
ESPN 74
ESPN2 74
ESPNU 51
ESPNEWS(2) 56
SEC Network(2) 51
ACC Network(2) 50
Freeform 73
FX Channels
FX 74
FXX 71
FXM 46
National Geographic Channels
National Geographic 73
National Geographic Wild 46
(1)
Based on Nielsen Media Research estimates as of September 2022 (except where noted). Estimates include traditional
MVPD and the majority of digital OTT subscriber counts.
(2)
Because Nielsen Media Research does not measure this channel, estimated subscribers are according to SNL Kagan as
of December 2021.
Broadcasting
ABC
As of October 1, 2022, ABC had affiliation agreements with approximately 240 local television stations reaching almost
100% of U.S. television households. ABC broadcasts programs in the primetime, daytime, late night, news and sports
“dayparts”. ABC is also available digitally through the ABC App and website to authenticated MVPD subscribers. Non-
subscribers have more limited access to on-demand episodes.
ABC also produces a variety of primetime specials, news and daytime programming.
Domestic Television Stations
The Company owns eight television stations, six of which are located in the top ten television household markets in the
U.S. All of our television stations are affiliated with ABC and collectively reach approximately 20% of the nation’s television
households.

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 The stations we own are as follows:
Television Market
TV Station Market Ranking(1)
WABC New York, NY 1
KABC Los Angeles, CA 2
WLS Chicago, IL 3
WPVI Philadelphia, PA 4
KGO San Francisco, CA 8
KTRK Houston, TX 9
WTVD Raleigh-Durham, NC 24
KFSN Fresno, CA 55
(1)
Based on Nielsen Media Research, U.S. Television Household Estimates, January 1, 2022
International Channels
Our International Channels focus on General Entertainment, Sports and/or Family programming and operate under four
significant brands: Disney; ESPN; Fox; and Star. Our international channels use content from the Company’s various studios,
including library titles, as well as content acquired from third parties.
The Company’s increased focus on DTC distribution in international markets is expected to negatively impact the
International Channels business as we shift the primary means of monetizing our content from licensing of linear channels to
distribution on our DTC platforms.
General Entertainment
The Company operates approximately 220 General Entertainment channels outside the U.S. primarily under the Fox,
National Geographic and Star brands, which are broadcast in approximately 40 languages and 180 countries/territories.
Fox branded channels air a variety of scripted, reality and documentary programming. Channels are often thematically
branded, focusing on such topics as comedy, cooking, crime and movies, and are broadcast in most regions internationally.
National Geographic branded channels air scripted and documentary programming on such topics as natural history,
science, exploration and culture, and are broadcast in most regions internationally.
Star branded channels air a variety of scripted, reality and documentary programming primarily in India. Channels are
also broadcast in other countries in Asia Pacific and Latin America.
In addition, the Company operates UTV and Bindass branded channels principally in India. UTV Action and UTV
Movies offer Bollywood movies as well as Hollywood, Asian and Indian regional movies dubbed in Hindi. Bindass is a youth
entertainment channel.
Sports
The Company operates approximately 55 Sports channels outside the U.S. under the ESPN, Fox and Star brands, which
are broadcast in approximately 10 languages and 105 countries/territories.
ESPN branded channels primarily operate in Latin America, Asia Pacific and Europe. In the Netherlands, the ESPN
branded channels are operated by Eredivisie Media & Marketing CV (EMM), which has the media and sponsorship rights of
the Dutch Premier League for soccer. The Company owns 51% of EMM.
Fox branded sports channels primarily operate in Latin America, Asia Pacific and Europe. Fox Sports Premium, a pay
television service in Argentina, airs the matches of the professional soccer league in Argentina.
Star branded sports channels primarily operate in India and certain other countries in Asia Pacific. Star has rights to
various sports programming including cricket, soccer, tennis and field hockey.
Family
The Company operates approximately 75 Family channels outside the U.S. primarily under the Disney brand, which are
broadcast in approximately 25 languages and 175 countries/territories.

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 As of September 2022, the estimated number of subscribers (in millions) for the Company’s significant international
channels, based on internal management reports, are as follows:
Subscribers
Disney
Disney Channel 151
Disney Junior 141
ESPN(1) 62
Fox(1) 139
National Geographic(1) 289
Star
General Entertainment(1) 180
Sports(1) 83
(1)
Reflects our estimate of each unique subscriber that has access to one or more of these branded channels.
Equity Investments
The Company has investments in media businesses that are accounted for under the equity method, the most significant of
which are A+E and CTV Specialty Television, Inc. (CTV). The Company’s share of the financial results for these investments
is reported as “Equity in the income (loss) of investees, net” in the Company’s Consolidated Statements of Operations.
A+E
A+E is owned 50% by the Company and 50% by Hearst. A+E operates a variety of cable channels:
• A&E – which offers entertainment programming including original reality and scripted series
• HISTORY – which offers original series and event-driven specials
• Lifetime and Lifetime Movie Network (LMN) – which offer female-focused programming
• FYI – which offers contemporary lifestyle programming
A+E programming is available in approximately 200 countries and territories. A+E’s networks are distributed
internationally under multi-year licensing agreements with MVPDs. A+E programming is also sold to international television
broadcasters and SVOD services.
As of September 2022, the number of domestic subscribers (in millions) for A+E channels are as follows:
Subscribers(1)
A&E 69
HISTORY 70
Lifetime 69
LMN 52
FYI 42
(1)
Based on Nielsen Media Research estimates as of September 2022. Estimates include traditional MVPD and the
majority of digital OTT subscriber counts.
CTV
ESPN holds a 30% equity interest in CTV, which owns television channels in Canada, including The Sports Networks
(TSN) 1-5, Le Réseau des Sports (RDS), RDS2, RDS Info, ESPN Classic Canada, Discovery Canada and Animal Planet
Canada.

Direct-to-Consumer
Our DTC businesses are subscription services that provide video streaming of general entertainment, family and sports
programming (services are offered individually or in various bundles) that are offered to customers directly or through third-
party distributors on mobile and internet connected devices.
Disney+ Services (includes Disney+ Hotstar and Star+)
Disney+ is a subscription-based DTC service with Disney, Pixar, Marvel, Star Wars and National Geographic branded
programming, which are all top level selections or “tiles” within the Disney+ interface. Outside the U.S. and Latin America,
Disney+ also includes a Star branded tile, which features general entertainment programming.

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 Disney+ Hotstar is a subscription-based DTC service available in India, Indonesia, Malaysia and Thailand. Programming
includes television shows, movies, sports and original series in approximately ten languages, in addition to gaming and social
features. Disney+ Hotstar has exclusive streaming rights to cricket from the International Cricket Council (ICC) and the Board
of Control for Cricket in India (BCCI), along with other cricket rights.
Star+ is a standalone DTC service in Latin America with a variety of general entertainment content and live sports
programming.
Disney+ services use content from the Company’s various studios, including library titles, as well as content acquired
from third parties.
The majority of Disney+ revenue is derived from subscription fees. In addition, Disney+ Hotstar generates advertising
revenue and Disney+ generates Premier Access fees. The Company plans to introduce an ad-supported Disney+ service in the
U.S. in December 2022 and internationally starting in late 2023.
As of October 1, 2022, the estimated number of paid Disney+, Disney+ Hotstar and Star+ subscribers, based on internal
management reports, was approximately 164 million.
ESPN+
ESPN+ is a subscription-based DTC service offering thousands of live sporting events, on-demand sports content and
original programming. ESPN+ revenue is derived from subscription fees, pay-per-view fees and, to a lesser extent, advertising
sales. Live events available through the service include mixed martial arts, soccer, hockey, boxing, baseball, college sports,
golf, tennis and cricket. ESPN+ is currently the exclusive distributor for Ultimate Fighting Championship (UFC) pay-per-view
events in the U.S. As of October 1, 2022, the estimated number of paid ESPN+ subscribers, based on internal management
reports, was approximately 24 million.
Hearst has a 20% interest in the Company’s DTC sports business.
Hulu
Hulu is a subscription-based DTC service with general entertainment content from the Company’s various studios as well
as content licensed from third parties. Hulu’s revenue is primarily derived from subscription fees and advertising sales. Hulu
offers SVOD services with or without advertising in addition to a digital OTT MVPD (Live TV) service that is available with
either of Hulu’s SVOD services and, since December 2021, includes the Disney+ and ESPN+ DTC services. Hulu’s Live TV
service includes live linear streams of cable networks and the major broadcast networks. In addition, Hulu offers subscriptions
to premium services such as HBOMax, Cinemax, Starz and Showtime, which can be added to the Hulu service. Certain
programming from ABC, Freeform and FX Channels is also available on the Hulu SVOD service one day after airing on these
channels. As of October 1, 2022, the estimated number of paid Hulu subscribers, based on internal management reports, was
approximately 47 million.
The Company has a 67% ownership interest in and full operational control of Hulu. NBC Universal (NBCU) owns the
remaining 33% of Hulu. The Company has a put/call agreement with NBCU, which provides NBCU the option to require the
Company to purchase NBCU’s interest in Hulu and the Company the option to require NBCU to sell its interest in Hulu to the
Company, in both cases, beginning in January 2024 (see Note 2 of the Consolidated Financial Statements for additional
information).

Content Sales/Licensing and Other

The majority of Content Sales/Licensing revenue is derived from TV/SVOD, theatrical and home entertainment
distribution. In addition, revenue is generated from music distribution and stage plays.
The Company also publishes National Geographic magazine and provides post-production services through Industrial
Light & Magic and Skywalker Sound. These activities are reported with Content Sales/Licensing.
TV/SVOD Distribution
Although we generally intend to use our film and television content on our DTC services and linear networks in TV/
SVOD windows, we also license our content to third-party television networks, television stations and other video service
providers for distribution to viewers on television or a variety of internet-connected devices, including through other DTC
services.
Theatrical Distribution
The Company licenses full-length live-action and animated films from the Company’s Studio production groups to
theaters globally. Cumulatively through October 1, 2022, the Company has released approximately 1,100 full-length live-action
films and 100 full-length animated films. In the domestic and most major international markets, we generally distribute and
market our films directly. In certain international markets our films are distributed by independent companies. During fiscal

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2023, we expect to release approximately 20 films, although we may choose to distribute certain films exclusively on our DTC
streaming services in certain territories.
The Company incurs significant marketing and advertising costs before and throughout the theatrical release of a film in
an effort to generate public awareness of the film, to increase the public’s intent to view the film and to help generate consumer
interest in the subsequent home entertainment and other ancillary markets. These costs are expensed as incurred, which may
result in a loss on a film in the theatrical markets, including in periods prior to the theatrical release of the film.
Home Entertainment Distribution
We distribute the Company’s film and episodic television content in home entertainment markets in physical (DVD and
Blu-ray disc) and electronic formats globally.
Domestically, we distribute directly to retailers and wholesalers. Internationally, we distribute directly and through
independent distribution companies. Physical formats of our film and episodic television content are generally sold to retailers,
such as Walmart and Target, and electronic formats are sold through e-tailers, such as Apple and Amazon, and MVPDs, such as
Comcast and DirecTV. The Company also operates Disney Movie Club, which sells DVD/Blu-ray discs directly to consumers
in the U.S. and Canada.
Distribution of film content in the home entertainment window generally starts within three months after the theatrical
release. Electronic formats may be released up to two weeks ahead of the physical release.
Distribution of episodic television content in the home entertainment window includes digital sales of season passes that
can be purchased prior to, during and after the broadcast season with individual episodes typically available to season pass
customers shortly after the initial airing of the show in each territory. Individual episodes are also available for digital purchase
shortly after their initial airing in each territory.
As of October 1, 2022, we have approximately 2,200 produced and acquired film titles that are actively distributed in the
home entertainment window, including approximately 1,900 live-action titles and approximately 300 animated titles.
Concurrently with physical home entertainment distribution, we license titles to video-on-demand services (such as Apple
and Amazon) for electronic delivery to consumers for a specified rental period.
Disney Theatrical Group
Disney Theatrical Group develops, produces and licenses live entertainment events on Broadway and around the world.
Productions include The Lion King, Frozen, Aladdin and Beauty and the Beast.
Disney Theatrical Group also licenses the Company’s IP to Feld Entertainment, the producer of Disney On Ice and Marvel
Universe Live!.
Music Distribution
The Disney Music Group (DMG) commissions new music for the Company’s motion pictures and television programs
and develops, produces, markets and distributes the Company’s music worldwide either directly or through license agreements.
DMG also licenses the songs and recording copyrights to third parties for printed music, records, audio-visual devices, public
performances and digital distribution and produces live musical concerts. DMG labels include Walt Disney Records and
Hollywood Records.
Equity Investment
The Company has a 30% effective interest in Tata Play Limited, which operates a direct-to-home satellite distribution
platform in India.

Studios
The Studios produce motion pictures under the Walt Disney Pictures, Twentieth Century Studios, Marvel, Lucasfilm,
Pixar and Searchlight Pictures banners. Costs to produce the films are generally capitalized and allocated to the distribution
platform utilizing the content.
Marvel licensed rights to produce and distribute Spider-Man films to Sony Pictures Entertainment (Sony) prior to the
Company’s fiscal 2010 acquisition of Marvel. In general, Sony incurs the costs to produce and distribute Spider-Man films and
the Company licenses the merchandise rights to third parties. The Company pays Sony a licensing fee based on each film’s box
office receipts, subject to specified limits. In general, the Company distributes other Marvel-produced films.
The Studios film library includes content from approximately 100 years of production history, as well as acquired film
libraries and totals approximately 5,100 live-action titles and 400 animation titles. The library includes approximately 50
movies and approximately 30 series that the Studios group produced for initial distribution on our DTC platforms.

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 In fiscal 2023, the Studios plan to produce approximately 40 titles, which include films and episodic television programs,
for distribution theatrically and/or on our DTC platforms.

General Entertainment
Content produced by General Entertainment primarily consists of original episodic television programs, network news and
daytime/nighttime content. General Entertainment also acquires episodic television programming rights. Original content is
generally produced by the following Company owned television studios: ABC Signature; 20th Television; Disney Branded
Television; FX Productions; and National Geographic Studios. Original content is also commissioned by General Entertainment
and produced by various other third-party studios. Costs to produce original content are generally capitalized and allocated to
the distribution platform utilizing the content. Program development is carried out in collaboration with writers, producers and
creative teams.
General Entertainments television programming library includes content from approximately 70 years of production
history. Series with four or more seasons include approximately 75 one-hour dramas, 55 half-hour comedies, 5 half-hour non-
scripted series, 30 one-hour non-scripted series, 15 half-hour animated series and 10 half-hour live-action series. The library
includes approximately 130 series that the General Entertainment group produced for initial distribution on our DTC platforms.
In fiscal 2023, General Entertainment plans to produce or commission more than 270 original programs, most of which
will include multiple episodes. Productions generally include comedies, dramas, animations, documentaries, specials, made for
TV movies, shorts and network news content. The vast majority of programming will be used on our Linear Networks and/or
our DTC platforms. Programming is also produced for third-parties, many of which have domestic linear distribution rights,
while the Company has SVOD and international distribution rights.

Sports
The Company has various professional and college sports programming rights, which the Sports group uses to produce
content aired on our Linear Networks and distributed on our DTC platforms, including live events, sports news and original
content. In the U.S., rights include college football (including bowl games and the College Football Playoff) and basketball, the
National Basketball Association (NBA), the National Football League (NFL), MLB, US Open Tennis, the Professional Golfers’
Association (PGA) Championship, the Women’s National Basketball Association (WNBA), soccer, Top Rank Boxing, the
Wimbledon Championships, the Masters golf tournament, mixed martial arts and the National Hockey League (NHL).
Internationally, rights include various cricket events (for which the Company has the global distribution rights to certain events)
and soccer (including English Premier League, LaLiga, Bundesliga and multiple UEFA leagues).

International
The International group focuses on the development and production of locally created and relevant entertainment and
sports content to support growth across the Company’s portfolio of streaming services. In addition, this group also oversees
international media operations, including international linear channels, local advertising sales and local content sales and
distribution. International has produced approximately 150 movies and series for initial distribution on the DTC platforms
worldwide.

Competition and Seasonality

The Company’s Linear Networks and DTC streaming services compete for viewers primarily with other television
networks, independent television stations and other media, such as other DTC streaming services and video games. With
respect to the sale of advertising time, we compete with other television networks, independent television stations, MVPDs and
other advertising media such as digital content, newspapers, magazines, radio and billboards. Our television and radio stations
primarily compete for audiences and advertisers in local market areas.
The Company’s Linear Networks compete with other networks for carriage by MVPDs. The Company’s contractual
agreements with MVPDs are renewed or renegotiated from time to time in the ordinary course of business. Consolidation and
other market conditions in the cable, satellite and telecommunication distribution industry and other factors may adversely
affect the Company’s ability to obtain and maintain contractual terms for the distribution of its various programming services
that are as favorable as those currently in place.
The Content Sales/Licensing businesses compete with all forms of entertainment. A significant number of companies
produce and/or distribute theatrical and television content, distribute products in the home entertainment market, provide pay
television and SVOD services, and produce music and live theater.
The operating results of Content Sales/Licensing fluctuate due to the timing and performance of releases in the theatrical,
home entertainment and television markets. Release dates are determined by several factors, including competition and the
timing of vacation and holiday periods.
The Company’s websites and digital products compete with other websites and entertainment products.

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 We also compete with other media and entertainment companies, independent production companies and SVOD services
for the acquisition of sports rights, creative and performing talent, story properties, show concepts, scripted and other
programming, advertiser support and exhibition outlets that are essential to the success of our DMED businesses.
Advertising revenues at Linear Networks and Direct-to-Consumer are subject to seasonal advertising patterns, changes in
viewership levels and the demand for sports programming. In general, domestic advertising revenues are typically somewhat
higher during the fall and somewhat lower during the summer months. In addition, advertising revenues generated from sports
programming are impacted by the timing of sports seasons and events, which varies throughout the year or may take place
periodically (e.g. biannually, quadrennially). Affiliate revenues vary with the subscriber trends of MVPDs.

Federal Regulation
Television and radio broadcasting are subject to extensive regulation by the Federal Communications Commission (FCC)
under federal laws and regulations, including the Communications Act of 1934, as amended. Violation of FCC regulations can
result in substantial monetary fines, limited renewals of licenses and, in egregious cases, denial of license renewal or revocation
of a license. FCC regulations that affect DMED include the following:
• Licensing of television and radio stations. Each of the television and radio stations we own must be licensed by the
FCC. These licenses are granted for periods of up to eight years, and we must obtain renewal of licenses as they expire
in order to continue operating the stations. We (and the acquiring entity in the case of a divestiture) must also obtain
FCC approval whenever we seek to have a license transferred in connection with the acquisition or divestiture of a
station. The FCC may decline to renew or approve the transfer of a license in certain circumstances and may delay
renewals while permitting a licensee to continue operating. Although we have received such renewals and approvals in
the past or have been permitted to continue operations when renewal is delayed, there can be no assurance that this will
be the case in the future.
• Television and radio station ownership limits. The FCC imposes limitations on the number of television stations and
radio stations we can own in a specific market, on the combined number of television and radio stations we can own in
a single market and on the aggregate percentage of the national audience that can be reached by television stations we
own. Currently:
◦ FCC regulations may restrict our ability to own more than one television station in a market, depending on the size
and nature of the market. We do not own more than one television station in any market.
◦ Federal statutes permit our television stations in the aggregate to reach a maximum of 39% of the national
audience. Pursuant to the most recent decision by the FCC as to how to calculate compliance with this limit, our
eight stations reach approximately 20% of the national audience.
◦ FCC regulations in some cases impose restrictions on our ability to acquire additional radio or television stations in
the markets in which we own radio stations. We do not believe any such limitations are material to our current
operating plans.
• Dual networks. FCC rules currently prohibit any of the four major broadcast television networks — ABC, CBS, Fox
and NBC — from being under common ownership or control.
• Regulation of programming. The FCC regulates broadcast programming by, among other things, banning “indecent”
programming, regulating political advertising and imposing commercial time limits during children’s programming.
Penalties for broadcasting indecent programming can be over $400,000 per indecent utterance or image per station.
Federal legislation and FCC rules also limit the amount of commercial matter that may be shown on broadcast or cable
channels during programming designed for children 12 years of age and younger. In addition, broadcast stations are
generally required to provide an average of three hours per week of programming that has as a “significant purpose”
meeting the educational and informational needs of children 16 years of age and younger. FCC rules also give
television station owners the right to reject or refuse network programming in certain circumstances or to substitute
programming that the licensee reasonably believes to be of greater local or national importance.
• Cable and satellite carriage of broadcast television stations. With respect to MVPDs operating within a television
station’s Designated Market Area, FCC rules require that every three years each television station elect either “must
carry” status, pursuant to which MVPDs generally must carry a local television station in the station’s market, or
“retransmission consent” status, pursuant to which the MVPDs must negotiate with the television station to obtain the
consent of the television station prior to carrying its signal. The ABC owned television stations have historically
elected retransmission consent.
• Cable and satellite carriage of programming. The Communications Act and FCC rules regulate some aspects of
negotiations between programmers and distributors regarding the carriage of networks by cable and satellite
distribution companies, and some cable and satellite distribution companies have sought regulation of additional
aspects of the carriage of programming on their systems. New legislation, court action or regulation in this area could
have an impact on the Company’s operations.

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 The foregoing is a brief summary of certain provisions of the Communications Act, other legislation and specific FCC
rules and policies. Reference should be made to the Communications Act, other legislation, FCC rules and public notices and
rulings of the FCC for further information concerning the nature and extent of the FCC’s regulatory authority.
FCC laws and regulations are subject to change, and the Company generally cannot predict whether new legislation, court
action or regulations, or a change in the extent of application or enforcement of current laws and regulations, would have an
adverse impact on our operations.

DISNEY PARKS, EXPERIENCES AND PRODUCTS

The operations of DPEP’s significant lines of business are as follows:
• Parks & Experiences:
◦ Theme parks and resorts, which include: Walt Disney World Resort in Florida; Disneyland Resort in California;
Disneyland Paris; Hong Kong Disneyland Resort (48% ownership interest); and Shanghai Disney Resort (43%
ownership interest), all of which are consolidated in our results. Additionally, the Company licenses our IP to a
third party to operate Tokyo Disney Resort.
◦ Disney Cruise Line, Disney Vacation Club, National Geographic Expeditions (73% ownership interest),
Adventures by Disney and Aulani, a Disney Resort & Spa in Hawaii
• Consumer Products:
◦ Licensing of our trade names, characters, visual, literary and other IP to various manufacturers, game developers,
publishers and retailers throughout the world, for use on merchandise, published materials and games
◦ Sale of branded merchandise through online, retail and wholesale businesses, and development and publishing of
books, comic books and magazines (except National Geographic magazine, which is reported in DMED)
The significant revenues of DPEP are as follows:
• Theme park admissions - Sales of tickets for admission to our theme parks and for premium access to certain
attractions (e.g. Genie+ and Lightning Lane)
• Parks & Experiences merchandise, food and beverage - Sales of merchandise, food and beverages at our theme parks
and resorts and cruise ships
• Resorts and vacations - Sales of room nights at hotels, sales of cruise and other vacations and sales and rentals of
vacation club properties
• Merchandise licensing and retail:
◦ Merchandise licensing - Royalties from licensing our IP for use on consumer goods
◦ Retail - Sales of merchandise through internet shopping sites generally branded shopDisney and at The Disney
Store, as well as to wholesalers (including books, comic books and magazines)
• Parks licensing and other - Revenues from sponsorships and co-branding opportunities, real estate rent and sales and
royalties earned on Tokyo Disney Resort revenues
The significant expenses of DPEP are as follows:
• Operating expenses consisting primarily of operating labor, costs of goods sold, infrastructure costs, supplies,
commissions and entertainment offerings. Infrastructure costs include technology support costs, repairs and
maintenance, property taxes, utilities and fuel, retail occupancy costs, insurance and transportation
• Selling, general and administrative costs, including marketing costs
• Depreciation and amortization
Significant capital investments:
• In recent years, the majority of the Company’s capital spend has been at our parks and experiences business, which is
principally for theme park and resort expansion, new attractions, cruise ships, capital improvements and systems
infrastructure. The various investment plans discussed in the “Parks & Experiences” section are based on
management’s current expectations. Actual investment may differ.

Parks & Experiences

Walt Disney World Resort
The Walt Disney World Resort is located approximately 20 miles southwest of Orlando, Florida, on approximately 25,000
acres of land. The resort includes theme parks (the Magic Kingdom, EPCOT, Disney’s Hollywood Studios and Disney’s
Animal Kingdom); hotels; vacation club properties; a retail, dining and entertainment complex (Disney Springs); a sports

14
complex; conference centers; campgrounds; golf courses; water parks; and other recreational facilities designed to attract
visitors for an extended stay.
The Walt Disney World Resort is marketed through a variety of international, national and local advertising and
promotional activities. A number of attractions and restaurants in each of the theme parks are sponsored or operated by other
companies under multi-year agreements.
Magic Kingdom — The Magic Kingdom consists of six themed areas: Adventureland, Fantasyland, Frontierland, Liberty
Square, Main Street USA and Tomorrowland. Each land provides a unique guest experience featuring themed attractions,
restaurants, merchandise shops and entertainment experiences. Tomorrowland is currently undergoing an expansion including
the Tron Lightcycle/Run, which is scheduled to open in Spring 2023.
EPCOT — EPCOT consists of four major themed areas: World Showcase, World Celebration, World Nature and World
Discovery. All areas feature themed attractions, restaurants, merchandise shops and entertainment experiences. Countries
represented with pavilions include Canada, China, France, Germany, Italy, Japan, Mexico, Morocco, Norway, the United
Kingdom and the U.S. EPCOT is undergoing a multi-year transformation, which includes the addition of Guardians of the
Galaxy: Cosmic Rewind, which opened in the summer of 2022 and Journey of Water, inspired by Moana, which is scheduled to
open late 2023.
Disney’s Hollywood Studios — Disney’s Hollywood Studios consists of eight themed areas: Animation Courtyard,
Commissary Lane, Echo Lake, Grand Avenue, Hollywood Boulevard, Star Wars: Galaxy’s Edge, Sunset Boulevard and Toy
Story Land. The areas provide behind-the-scenes glimpses of Hollywood-style action through various shows and attractions and
offer themed food service, merchandise shops and entertainment experiences.
Disney’s Animal Kingdom — Disney’s Animal Kingdom consists of a 145-foot tall Tree of Life centerpiece surrounded
by five themed areas: Africa, Asia, DinoLand USA, Discovery Island and Pandora - The World of Avatar. Each themed area
contains attractions, restaurants, merchandise shops and entertainment experiences. The park features more than 300 species of
live mammals, birds, reptiles and amphibians and 3,000 varieties of vegetation.
Hotels, Vacation Club Properties and Other Resort Facilities — As of October 1, 2022, the Company owned and
operated 19 resort hotels and vacation club facilities at the Walt Disney World Resort, with approximately 23,000 rooms and
3,600 vacation club units. Resort facilities include 500,000 square feet of conference meeting space and Disney’s Fort
Wilderness camping and recreational area, which offers approximately 800 campsites.
Disney Springs is an approximately 120-acre retail, dining and entertainment complex and consists of four areas:
Marketplace, The Landing, Town Center and West Side. The areas are home to more than 150 venues including the 64,000-
square-foot World of Disney retail store. Most of the Disney Springs facilities are operated by third parties that pay rent to the
Company.
Ten independently-operated hotels with approximately 7,000 rooms are situated on property leased from the Company.
ESPN Wide World of Sports Complex is a 230-acre center that hosts professional caliber training and competitions,
festival and tournament events and interactive sports activities. The complex, which welcomes both amateur and professional
athletes, accommodates multiple sporting events, including baseball, basketball, football, soccer, softball, tennis and track and
field. It also includes a stadium, as well as two venues designed for cheerleading, dance competitions and other indoor sports.
Other recreational amenities and activities available at the Walt Disney World Resort include three championship golf
courses, miniature golf courses, full-service spas, tennis, sailing, swimming, horseback riding and a number of other sports and
leisure time activities. The resort also includes two water parks: Disney’s Blizzard Beach and Disney’s Typhoon Lagoon.
Disneyland Resort
The Company owns 489 acres and has rights under a long-term lease for use of an additional 52 acres of land in Anaheim,
California. The Disneyland Resort includes two theme parks (Disneyland and Disney California Adventure), three resort hotels
and a retail, dining and entertainment complex (Downtown Disney).
The Disneyland Resort is marketed through a variety of international, national and local advertising and promotional
activities. A number of the attractions and restaurants in the theme parks are sponsored or operated by other companies under
multi-year agreements.
Disneyland — Disneyland consists of nine themed areas: Adventureland, Critter Country, Fantasyland, Frontierland, Main
Street USA, Mickey’s Toontown, New Orleans Square, Star Wars: Galaxy’s Edge, and Tomorrowland. These areas feature
themed attractions, restaurants, merchandise shops and entertainment experiences. Mickey’s Toontown is currently undergoing
an expansion and transformation, including the addition of Mickey and Minnie’s Runaway Railway, which is scheduled to open
in early 2023.

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 Disney California Adventure — Disney California Adventure is adjacent to Disneyland and includes eight themed areas:
Avengers Campus, Buena Vista Street, Cars Land, Grizzly Peak, Hollywood Land, Pacific Wharf (which will be transformed
into San Fransokyo from Big Hero 6), Paradise Gardens Park and Pixar Pier. These areas include themed attractions,
restaurants, merchandise shops and entertainment experiences.
Hotels, Vacation Club Units and Other Resort Facilities — Disneyland Resort includes three Company owned and
operated hotels and vacation club facilities with approximately 2,400 rooms, 50 vacation club units and 180,000 square feet of
conference meeting space.
Downtown Disney is a themed 15-acre retail, entertainment and dining complex with approximately 30 venues located
adjacent to both Disneyland and Disney California Adventure. Most of the Downtown Disney facilities are operated by third
parties that pay rent to the Company.
Aulani, a Disney Resort & Spa
Aulani, a Disney Resort & Spa, is a Company-operated family resort on a 21-acre oceanfront property on Oahu, Hawaii
featuring approximately 350 hotel rooms, an 18,000-square-foot spa and 12,000 square feet of conference meeting space. The
resort also has approximately 480 vacation club units.
Disneyland Paris
Disneyland Paris is located on approximately 5,200-acres in Marne-la-Vallée, approximately 20 miles east of Paris,
France. The land is being developed pursuant to a master agreement with French governmental authorities. Disneyland Paris
includes two theme parks (Disneyland Park and Walt Disney Studios Park); seven themed resort hotels; two convention centers;
a shopping, dining and entertainment complex (Disney Village); and a 27-hole golf facility. Of the 5,200 acres comprising the
site, approximately half have been developed to date, including a planned community (Val d’Europe) and an eco-tourism
destination (Villages Nature).
Disneyland Park — Disneyland Park consists of five themed areas: Adventureland, Discoveryland, Fantasyland,
Frontierland and Main Street USA. These areas include themed attractions, restaurants, merchandise shops and entertainment
experiences.
Walt Disney Studios Park — Walt Disney Studios Park includes five themed areas: Front Lot, Production Courtyard,
Toon Studio, Worlds of Pixar and Avengers Campus, which opened in the summer of 2022. These areas each include themed
attractions, restaurants, merchandise shops and entertainment experiences. Walt Disney Studios Park is undergoing a multi-year
expansion that will include a new themed area based on Frozen.
Hotels and Other Facilities — Disneyland Paris operates seven resort hotels, with approximately 5,750 rooms and
250,000 square feet of conference meeting space. In addition, five on-site hotels that are owned and operated by third parties
provide approximately 1,500 rooms.
Disney Village is an approximately 500,000-square-foot retail, dining and entertainment complex located between the
theme parks and the hotels. A number of the Disney Village facilities are operated by third parties that pay rent to the Company.
Val d’Europe is a planned community near Disneyland Paris that is being developed in phases. Val d’Europe currently
includes a regional train station, hotels and a town center consisting of a shopping center as well as office, commercial and
residential space. Third parties operate these developments on land leased or purchased from the Company.
Villages Nature is an eco-tourism resort that consists of recreational facilities, restaurants and 900 vacation units. The
resort is a 50% joint venture between the Company and Pierre & Vacances-Center Parcs, which manages the venture.
Hong Kong Disneyland Resort
The Company owns a 48% interest in Hong Kong Disneyland Resort and the Government of the Hong Kong Special
Administrative Region (HKSAR) owns a 52% interest. The resort is located on 310 acres on Lantau Island and is in close
proximity to the Hong Kong International Airport and the Hong Kong-Zhuhai-Macau Bridge. Hong Kong Disneyland Resort
includes one theme park and three themed resort hotels. A separate Hong Kong subsidiary of the Company is responsible for
managing Hong Kong Disneyland Resort. The Company is entitled to receive royalties and management fees based on the
operating performance of Hong Kong Disneyland Resort.
Hong Kong Disneyland — Hong Kong Disneyland consists of seven themed areas: Adventureland, Fantasyland, Grizzly
Gulch, Main Street USA, Mystic Point, Tomorrowland and Toy Story Land. These areas feature themed attractions, restaurants,
merchandise shops and entertainment experiences. The park is in the midst of a multi-year expansion project that includes a
Frozen-themed area, expected to open in 2023.
Hotels — Hong Kong Disneyland Resort includes three themed hotels with a total of 1,750 rooms and approximately
16,000 square feet of conference meeting space.

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Shanghai Disney Resort
The Company owns a 43% interest in Shanghai Disney Resort and Shanghai Shendi (Group) Co., Ltd (Shendi) owns a
57% interest. The resort is located in the Pudong district of Shanghai on approximately 1,000 acres of land, which includes the
Shanghai Disneyland theme park; two themed resort hotels; a retail, dining and entertainment complex (Disneytown); and an
outdoor recreation area. A management company, in which the Company has a 70% interest and Shendi has a 30% interest, is
responsible for operating the resort and receives a management fee based on the operating performance of Shanghai Disney
Resort. The Company is also entitled to royalties based on the resort’s revenues.
Shanghai Disneyland — Shanghai Disneyland consists of seven themed areas: Adventure Isle, Fantasyland, Gardens of
Imagination, Mickey Avenue, Tomorrowland, Toy Story Land and Treasure Cove. These areas feature themed attractions,
shows, restaurants, merchandise shops and entertainment experiences. The Company is constructing an eighth themed area
based on the animated film Zootopia.
Hotels and Other Facilities — Shanghai Disneyland Resort includes two themed hotels with a total of 1,220 rooms.
Disneytown is an 11-acre outdoor complex of dining, shopping and entertainment venues located adjacent to Shanghai
Disneyland. Most Disneytown facilities are operated by third parties that pay rent to Shanghai Disney Resort.
Tokyo Disney Resort
Tokyo Disney Resort is located on 494 acres of land, six miles east of downtown Tokyo, Japan. The Company earns
royalties on revenues generated by the Tokyo Disney Resort, which is owned and operated by Oriental Land Co., Ltd. (OLC), a
third-party Japanese corporation. The resort includes two theme parks (Tokyo Disneyland and Tokyo DisneySea); five Disney-
branded hotels; six other hotels (operated by third parties other than OLC); a retail, dining and entertainment complex
(Ikspiari); and Bon Voyage, a Disney-themed merchandise location.
Tokyo Disneyland — Tokyo Disneyland consists of seven themed areas: Adventureland, Critter Country, Fantasyland,
Tomorrowland, Toontown, Westernland and World Bazaar.
Tokyo DisneySea — Tokyo DisneySea is divided into seven “ports of call,” including American Waterfront, Arabian
Coast, Lost River Delta, Mediterranean Harbor, Mermaid Lagoon, Mysterious Island and Port Discovery. OLC is expanding
Tokyo DisneySea to include an eighth themed port, Fantasy Springs expected to open in spring 2024.
Hotels and Other Resort Facilities — Tokyo Disney Resort includes five Disney-branded hotels with a total of more than
3,000 rooms and a monorail, which links the theme parks and resort hotels with Ikspiari. OLC is currently constructing a 475-
room Disney-branded hotel at Tokyo DisneySea that is expected to open in spring 2024.
Disney Vacation Club (DVC)
DVC offers ownership interests in 15 resort facilities located at the Walt Disney World Resort; Disneyland Resort;
Aulani; Vero Beach, Florida; and Hilton Head Island, South Carolina. Available units are offered for sale under a vacation
ownership plan and are operated as hotel rooms when not occupied by vacation club members. The Company’s vacation club
units range from deluxe studios to three-bedroom grand villas. Unit counts in this document are presented in terms of two-
bedroom equivalents. DVC had approximately 4,400 vacation club units as of October 1, 2022 and is scheduled to open an
additional 135 units at The Villas at Disneyland Hotel in 2023. The Company also plans to open additional units at Disney’s
Polynesian Village Resort in late 2024.
Storyliving by Disney
The Company is developing its first Storyliving by Disney residential community, Cotino, in Rancho Mirage, California.
Disney Cruise Line
Disney Cruise Line is a five-ship vacation cruise line, which operates out of ports in North America and Europe. The
Disney Magic and the Disney Wonder are 85,000-ton 875-stateroom ships; the Disney Dream and the Disney Fantasy are
130,000-ton 1,250-stateroom ships; and the Disney Wish, launched in July 2022, is a 140,000-ton 1,250-stateroom ship. The
ships cater to families, children, teenagers and adults, with themed areas and activities for each group. Many cruise vacations
include a visit to Disney’s Castaway Cay, a 1,000-acre private Bahamian island.
Disney Cruise Line is adding the Disney Treasure and a seventh ship, which are to be delivered from the shipyard in fiscal
2025 and fiscal 2026, respectively. Both of these ships will be approximately 140,000 tons with 1,250 staterooms and will be
powered by liquefied natural gas.
In November 2022, the Company purchased a partially completed ship for an amount that is not material. The ship will be
approximately 200,000 tons. Disney Cruise Line will incur the cost to complete construction with total costs anticipated to be
less than our recent fleet additions. This ship is expected to be delivered in 2025.

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 The Company has approximately 550 acres of land at Lighthouse Point on the island of Eleuthera, which is scheduled to
open as a Disney Cruise Line destination in 2024.
Adventures by Disney and National Geographic Expeditions
Adventures by Disney and National Geographic Expeditions offer guided tour packages predominantly at non-Disney
sites around the world.
Walt Disney Imagineering
Walt Disney Imagineering provides master planning, real estate development, attraction, entertainment and show design,
engineering support, production support, project management and research and development for DPEP.

Consumer Products
Licensing
The Company’s merchandise licensing operations cover a diverse range of product categories, the most significant of
which are: toys, apparel, games, home décor and furnishings, accessories, food, books, health and beauty, stationery, footwear,
magazines and consumer electronics. The Company licenses characters from its film, television and other properties for use on
third-party products in these categories and earns royalties, which are usually based on a fixed percentage of the wholesale or
retail selling price of the products. Some of the major properties licensed by the Company include: Mickey and Friends, Star
Wars, Spider-Man, Disney Princess, Avengers, Frozen, Toy Story, Winnie the Pooh and Cars.
Retail
The Company sells Disney-, Marvel-, Pixar- and Lucasfilm-branded products through shopDisney branded internet sites
and Disney Store branded retail locations. At October 1, 2022, the Company owns and operates approximately 40 stores in
Japan, 20 stores in North America, three stores in Europe and one store in China.
The Company creates, distributes and publishes a variety of products in multiple countries and languages based on the
Company’s branded franchises. The products include children’s books and comic books.

Competition and Seasonality

The Company’s theme parks and resorts as well as Disney Cruise Line and Disney Vacation Club compete with other
forms of entertainment, lodging, tourism and recreational activities. The profitability of the leisure-time industry may be
influenced by various factors that are not directly controllable, such as economic conditions including business cycle and
exchange rate fluctuations, health concerns, the political environment, travel industry trends, amount of available leisure time,
oil and transportation prices, weather patterns and natural disasters. The licensing and retail business competes with other
licensors, retailers and publishers of character, brand and celebrity names, as well as other licensors, publishers and developers
of game software, online video content, websites, other types of home entertainment and retailers of toys and kids merchandise.
All of the theme parks and the associated resort facilities are operated on a year-round basis. Typically, theme park
attendance and resort occupancy fluctuate based on the seasonal nature of vacation travel and leisure activities, the opening of
new guest offerings and pricing and promotional offers. Peak attendance and resort occupancy generally occur during the
summer months when school vacations occur and during early winter and spring holiday periods. The licensing, retail and
wholesale businesses are influenced by seasonal consumer purchasing behavior, which generally results in higher revenues
during the Company’s first and fourth fiscal quarter, and by the timing and performance of theatrical and game releases and
cable programming broadcasts.

INTELLECTUAL PROPERTY PROTECTION

The Company’s businesses throughout the world are affected by its ability to exploit and protect against infringement of
its IP, including trademarks, trade names, copyrights, patents and trade secrets. Important IP includes rights in the content of
motion pictures, television programs, electronic games, sound recordings, character likenesses, theme park attractions, books
and magazines, and merchandise. Risks related to the protection and exploitation of IP rights and information concerning the
expiration of certain of our copyrights are set forth in Item 1A – Risk Factors.

AVAILABLE INFORMATION
Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those
reports are available without charge on our website, www.disney.com/investors, as soon as reasonably practicable after they are
filed electronically with the U.S. Securities and Exchange Commission (SEC). We are providing the address to our internet site
solely for the information of investors. We do not intend the address to be an active link or to otherwise incorporate the contents
of the website into this report.

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ITEM 1A. Risk Factors
For an enterprise as large and complex as the Company, a wide range of factors could materially affect future
developments and performance. In addition to the factors affecting specific business operations identified in connection with the
description of these operations and the financial results of these operations elsewhere in our filings with the SEC, the most
significant factors affecting our business include the following:

BUSINESS, ECONOMIC, MARKET and OPERATING CONDITION RISKS

The adverse impact of COVID-19 on our businesses will continue for an unknown length of time and may continue to
impact certain of our key sources of revenue.
Since early 2020, the world has been and continues to be impacted by COVID-19 and its variants. COVID-19 and
measures to prevent its spread have impacted our segments in a number of ways, most significantly at DPEP where our theme
parks and resorts were closed and cruise ship sailings and guided tours were suspended. In addition, at DMED we delayed, or in
some cases, shortened or canceled theatrical releases and experienced disruptions in the production and availability of content.
Collectively, our impacted businesses have historically been the source of the majority of our revenue. Operations have
resumed at various points since May 2020, with certain theme parks and resort operations and film and television productions
resuming by the end of fiscal 2020 and throughout 2021. Although operations resumed, many of our businesses continue to
experience impacts from COVID-19, such as incremental health and safety measures and related increased expenses, capacity
restrictions and closures (including at some of our international parks and in theaters in certain markets), and disruptions of
content production activities.
COVID-19 impacts and future health outbreaks and pandemics could hasten the erosion of historical sources of revenue at
our Linear Networks businesses and change consumer preferences. For example, COVID-19 impacts have changed, and may
continue to change, consumer behavior and consumption patterns, such as theater-going to watch movies. Some industries in
which our customers operate, such as theatrical distribution, retail and travel, have experienced, and could continue to
experience, contraction and financial distress, which could impact the profitability of our businesses going forward.
Our mitigation efforts in response to the impacts of COVID-19 on our businesses have had, or may continue to have,
negative impacts. For example, in response to COVID-19 impacts, we incurred significant additional indebtedness and delayed
or suspended certain projects in which we have invested, particularly at our parks and resorts and studio operations. In addition,
we may take mitigation actions in the future to respond to the impacts of COVID-19 or other health outbreaks or pandemics on
our businesses, such as raising additional financing; not declaring future dividends; further suspending or reducing capital
spending; reducing film and television content investments; implementing furloughs or reductions in force or modifying our
operating strategy. These and other of our mitigating actions may have an adverse impact on our businesses. Additionally, there
are limitations on our ability to mitigate the adverse financial impact of COVID-19 and other health outbreaks or pandemics,
including the fixed costs of our theme park business and the impact such events may have on capital markets and our cost of
borrowing.
Geographic variation in government requirements and ongoing changes to restrictions have disrupted and could further
disrupt our businesses, including our production operations. Our operations could be suspended, re-suspended or subjected to
new or reinstated limitations by government action or otherwise in the future as a result of developments related to COVID-19,
such as the expansion of the Omicron subvariants or other variants, and other future health outbreaks and pandemics. For
example, our international parks have reopened and closed multiple times since the onset of COVID-19. Some of our
employees who returned to work were later refurloughed. Our operations could be further negatively impacted and our
reputation could be negatively impacted by a significant COVID-19 or other health outbreak impacting our employees,
customers or others interacting with our businesses, including our supply chain.
The impacts of COVID-19 to our business have generally amplified, or reduced our ability to mitigate, the other risks
discussed in our filings with the SEC and our remediation efforts may not be successful.
COVID-19 also makes it more challenging for management to estimate future performance of our businesses. COVID-19
has already adversely impacted our businesses and net cash flow, and we expect the ultimate magnitude of these disruptions on
our financial and operational results will be dictated by the length of time that such disruptions continue which will, in turn,
depend on the currently unknowable duration and severity of the impacts of COVID-19, and among other things, the impact
and duration of governmental actions imposed in response to COVID-19 and individuals’ and companies’ risk tolerance
regarding health matters going forward.
Changes in U.S., global, and regional economic conditions are expected to have an adverse effect on the profitability of
our businesses.
A decline in economic conditions, such as recession, economic downturn, and/or inflationary conditions in the U.S. and
other regions of the world in which we do business can adversely affect demand and/or expenses for any of our businesses, thus
reducing our revenue and earnings. Past declines in economic conditions reduced spending at our parks and resorts, purchases

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of and prices for advertising on our broadcast and cable networks and owned stations, performance of our home entertainment
releases, and purchases of Company-branded consumer products, and similar impacts can be expected as such conditions recur.
The current decline in economic conditions could also reduce attendance at our parks and resorts, prices that MVPDs pay for
our cable programming, purchases of and prices for advertising on our DTC products or subscription levels for our cable
programming or DTC products, while also increasing the prices we pay for goods, services and labor. Economic conditions can
also impair the ability of those with whom we do business to satisfy their obligations to us. In addition, an increase in price
levels generally, or in price levels in a particular sector such as current inflation in the domestic and global energy sector and
other pronounced price increases generally and in certain other sectors, could result in a shift in consumer demand away from
the entertainment and consumer products we offer, which could also adversely affect our revenues and, at the same time,
increase our costs. A decline in economic conditions could impact implementation of our business plans, such as our plans to
realign our cost structure and for the new DTC ad-supported service, pricing structure and price increases. In addition, actions
to reduce inflation, including raising interest rates, increase our cost of borrowing, which in turn could make it more difficult to
obtain financing for our operations or investments on favorable terms. Further, global economic conditions may impact foreign
currency exchange rates against the U.S. dollar. The current or continued strength in the value of the U.S. dollar has adversely
impacted the U.S. dollar value of revenue we receive and expect to receive from other markets and may reduce international
demand for our products and services. A decrease in the value of the U.S. dollar may increase our labor, supply or other costs in
non-U.S. markets. Although we hedge exposure to certain foreign currency fluctuations, any such hedging activity may not
substantially offset the negative financial impact of exchange rate fluctuations and is not expected to offset all such negative
financial impact, particularly in periods of sustained U.S. dollar strength relative to multiple foreign currencies. Further,
economic or political conditions in countries outside the U.S. also have reduced, and could continue to reduce, our ability to
hedge exposure to currency fluctuations in those countries or our ability to repatriate revenue from those countries. Broader
supply chain delays, such as those currently impacting global distribution may further exacerbate current inflationary pressures
and impact our ability to sell and deliver goods or otherwise disrupt our operations. The adverse impact on our businesses of the
decline in economic conditions will depend, in part, on its severity and duration and our ability to mitigate the impacts of this
decline on our businesses will be limited.
Changes in technology and in consumer consumption patterns may affect demand for our entertainment products, the
revenue we can generate from these products or the cost of producing or distributing products.
The media entertainment and internet businesses in which we participate increasingly depend on our ability to
successfully adapt to shifting patterns of content consumption through the adoption and exploitation of new technologies. New
technologies affect the demand for our products, the manner in which our products are distributed to consumers, ways we
charge for and receive revenue for our entertainment products and the stability of those revenue streams, the sources and nature
of competing content offerings, the time and manner in which consumers acquire and view some of our entertainment products
and the options available to advertisers for reaching their desired audiences. This trend has impacted the business model for
certain traditional forms of distribution, as evidenced by the industry-wide decline in ratings for broadcast television, the
reduction in demand for home entertainment sales of theatrical content, the development of alternative distribution channels for
broadcast and cable programming and declines in subscriber levels for traditional cable channels, including for a number of our
networks. In addition, theater-going to watch movies currently is, and may continue to be, below pre-COVID-19 levels.
Declines in linear viewership have resulted in decreased advertising revenue. In order to respond to these developments, we
regularly consider, and from time to time implement changes to our business models, most recently by developing, investing in
and acquiring DTC products, initiating plans to again reorganize our media and entertainment businesses to advance our DTC
strategies, and developing next generation storytelling offerings. There can be no assurance that our DTC offerings, next
generation storytelling offerings and other efforts will successfully respond to these changes. In addition, declines in certain
traditional forms of distribution may increase the cost of content allocable to our DTC offerings, negatively impacting the
profitability of our DTC offerings. We expect to forgo revenue from traditional sources, particularly as we expand our DTC
offerings. To date we have experienced significant losses in our DTC businesses. There can be no assurance that the DTC
model and other business models we may develop will ultimately be profitable or as profitable as our existing or historic
business models.
Misalignment with public and consumer tastes and preferences for entertainment, travel and consumer products could
negatively impact demand for our entertainment offerings and products and adversely affect the profitability of any of
our businesses.
Our businesses create entertainment, travel and consumer products whose success depends substantially on consumer
tastes and preferences that change in often unpredictable ways. The success of our businesses depends on our ability to
consistently create compelling content, which may be distributed, among other ways, through broadcast, cable, internet or
cellular technology, theme park attractions, hotels and other resort facilities and travel experiences and consumer products.
Such distribution must meet the changing preferences of the broad consumer market and respond to competition from an
expanding array of choices facilitated by technological developments in the delivery of content. The success of our theme
parks, resorts, cruise ships and experiences, as well as our theatrical releases, depends on demand for public or out-of-home

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entertainment experiences. Demand for certain of our out-of-home entertainment experiences, such as theater-going to watch
movies, has not returned to pre-pandemic levels, and COVID-19 may continue to impact consumer tastes and preferences. In
addition, many of our businesses increasingly depend on acceptance of our offerings and products by consumers outside the
U.S. The success of our businesses therefore depends on our ability to successfully predict and adapt to changing consumer
tastes and preferences outside as well as inside the U.S. Moreover, we must often invest substantial amounts in content
production and acquisition, acquisition of sports rights, theme park attractions, cruise ships or hotels and other facilities or
customer facing platforms before we know the extent to which these products will earn consumer acceptance, and these
products may be introduced into a significantly different market or economic or social climate from the one we anticipated at
the time of the investment decisions. If our entertainment offerings and products (including our content offerings, which have
been impacted by COVID-19 and may in the future be impacted by COVID-19 developments or other health outbreaks or
pandemics) as well as our methods to make our offerings and products available to consumers, do not achieve sufficient
consumer acceptance, our revenue may decline, decline further or fail to grow to the extent we anticipate when making
investment decisions and thereby further adversely affect the profitability of one or more of our businesses. Further, consumers’
perceptions of our position on matters of public interest, including our efforts to achieve certain of our environmental and social
goals, often differ widely and present risks to our reputation and brands. Consumer tastes and preferences impact, among other
items, revenue from advertising sales (which are based in part on ratings for the programs in which advertisements air), affiliate
fees, subscription fees, theatrical film receipts, the license of rights to other distributors, theme park admissions, hotel room
charges and merchandise, food and beverage sales, sales of licensed consumer products or sales of our other consumer products
and services.
The success of our businesses is highly dependent on the existence and maintenance of intellectual property rights in the
entertainment products and services we create.
The value to us of our IP is dependent on the scope and duration of our rights as defined by applicable laws in the U.S.
and abroad and the manner in which those laws are construed. If those laws are drafted or interpreted in ways that limit the
extent or duration of our rights, or if existing laws are changed, our ability to generate revenue from our IP may decrease, or the
cost of obtaining and maintaining rights may increase. The terms of some copyrights for IP related to some of our products and
services have expired and other copyrights will expire in the future. For example, in the United States and countries that look to
the United States copyright term when shorter than their own, the copyright term for early works such as the short film
Steamboat Willie (1928), and the specific early versions of characters depicted in those works, expires at the end of the 95th
calendar year after the date the copyright was originally secured in the United States. Revenues generated from this intellectual
property could be negatively impacted.
The unauthorized use of our IP may increase the cost of protecting rights in our IP or reduce our revenues. The
convergence of computing, communication and entertainment devices, increased broadband internet speed and penetration,
increased availability and speed of mobile data transmission and increasingly sophisticated attempts to obtain unauthorized
access to data systems have made the unauthorized digital copying and distribution of our films, television productions and
other creative works easier and faster and protection and enforcement of IP rights more challenging. The unauthorized
distribution and access to entertainment content generally continues to be a significant challenge for IP rights holders.
Inadequate laws or weak enforcement mechanisms to protect entertainment industry IP in one country can adversely affect the
results of the Company’s operations worldwide, despite the Company’s efforts to protect its IP rights. COVID-19 and
distribution innovation in response to COVID-19 has increased opportunities to access content in unauthorized ways.
Additionally, negative economic conditions coupled with a shift in government priorities could lead to less enforcement. These
developments require us to devote substantial resources to protecting our IP against unlicensed use and present the risk of
increased losses of revenue as a result of unlicensed distribution of our content and other commercial misuses of our IP.
With respect to IP developed by the Company and rights acquired by the Company from others, the Company is subject to
the risk of challenges to our copyright, trademark and patent rights by third parties. Successful challenges to our rights in IP
may result in increased costs for obtaining rights or the loss of the opportunity to earn revenue from or utilize the IP that is the
subject of challenged rights. From time to time, the Company has been notified that it may be infringing certain IP rights of
third parties. Technological changes in industries in which the Company operates and extensive patent coverage in those areas
may increase the risk of such claims being brought and prevailing.
Protection of electronically stored data and other cybersecurity is costly, and if our data or systems are materially
compromised in spite of this protection, we may incur additional costs, lost opportunities, damage to our reputation,
disruption of service or theft of our assets.
We maintain information necessary to conduct our business, including confidential and proprietary information as well as
personal information regarding our customers and employees, in digital form. We also use computer systems to deliver our
products and services and operate our businesses. Data maintained in digital form is subject to the risk of unauthorized access,
modification, exfiltration, destruction or denial of access and our computer systems are subject to cyberattacks that may result
in disruptions in service. We use many third-party systems and software, which are also subject to supply chain and other

21
cyberattacks. We develop and maintain an information security program to identify and mitigate cyber risks but the
development and maintenance of this program is costly and requires ongoing monitoring and updating as technologies change
and efforts to overcome security measures become more sophisticated. Accordingly, despite our efforts, the risk of
unauthorized access, modification, exfiltration, destruction or denial of access with respect to data or systems and other
cybersecurity attacks cannot be eliminated entirely, and the risks associated with a potentially material incident remain. In
addition, we provide some confidential, proprietary and personal information to third parties in certain cases, which may also be
compromised.
If our information or cyber security systems or data are compromised in a material way, our ability to conduct our
business may be impaired, we may lose profitable opportunities or the value of those opportunities may be diminished and, as
described above, we may lose revenue as a result of unlicensed use of our intellectual property. If personal information of our
customers or employees is misappropriated, our reputation with our customers and employees may be damaged resulting in loss
of business or morale, and we may incur costs to remediate possible harm to our customers and employees or damages arising
from litigation and/or to pay fines or take other action with respect to judicial or regulatory actions arising out of the incident.
Insurance we obtain may not cover losses or damages associated with such attacks or events. Our systems and users and those
of third parties with whom we engage are continually attacked, sometimes successfully.
A variety of uncontrollable events may reduce demand for or consumption of our products and services, impair our
ability to provide our products and services or increase the cost or reduce the profitability of providing our products
and services.
Demand for and consumption of our products and services, particularly our theme parks and resorts, is highly dependent
on the general environment for travel and tourism. The environment for travel and tourism, as well as demand for and
consumption of other entertainment products, can be significantly adversely affected in the U.S., globally or in specific regions
as a result of a variety of factors beyond our control, including: health concerns (including as it has been by COVID-19 and
could be by future health outbreaks and pandemics); adverse weather conditions arising from short-term weather patterns or
long-term climate change, catastrophic events or natural disasters (such as excessive heat or rain, hurricanes, typhoons, floods,
droughts, tsunamis and earthquakes); international, political or military developments (including social unrest); a decline in
economic activity; and terrorist attacks. These events and others, such as fluctuations in travel and energy costs and computer
virus attacks, intrusions or other widespread computing or telecommunications failures, may also damage our ability to provide
our products and services or to obtain insurance coverage with respect to some of these events. An incident that affected our
property directly would have a direct impact on our ability to provide goods and services and could have an extended effect of
discouraging consumers from attending our facilities. Moreover, the costs of protecting against such incidents, including the
costs of protecting against the spread of COVID-19, reduces the profitability of our operations.
For example, hurricanes, including Hurricane Ian in late September 2022, which caused Walt Disney World Resort parks
in Florida to close for two days, have impacted the profitability of Walt Disney World Resort and may do so in the future. The
Company has paused certain operations in certain regions and the profitability of certain operations has been impacted as a
result of events in the corresponding regions.
In addition, we derive affiliate fees and royalties from the distribution of our programming, sales of our licensed goods
and services by third parties, and the management of businesses operated under brands licensed from the Company, and we are
therefore dependent on the successes of those third parties for that portion of our revenue. A wide variety of factors could
influence the success of those third parties and if negative factors significantly impacted a sufficient number of those third
parties, the profitability of one or more of our businesses could be adversely affected. In specific geographic markets, we have
experienced delayed and/or partial payments from certain affiliate partners due to liquidity issues.
We obtain insurance against the risk of losses relating to some of these events, generally including certain physical
damage to our property and resulting business interruption, certain injuries occurring on our property and some liabilities for
alleged breach of legal responsibilities. When insurance is obtained it is subject to deductibles, exclusions, terms, conditions
and limits of liability. The types and levels of coverage we obtain vary from time to time depending on our view of the
likelihood of specific types and levels of loss in relation to the cost of obtaining coverage for such types and levels of loss and
we may experience material losses not covered by our insurance. For example, many losses related to impacts of COVID-19
have not been covered by insurance available to us.
Changes in our business strategy or restructuring of our businesses has increased and may continue to increase our
costs and has otherwise affected and may continue to affect the profitability of our businesses or the value of our assets.
As changes in our business environment occur we have adjusted, continue to adjust and may further adjust our business
strategies to meet these changes and we may otherwise decide to further restructure our operations or particular businesses or
assets. For example, in November 2022, we announced plans to reorganize DMED to advance our DTC strategies and
rationalize costs; in fiscal 2022, we announced plans to introduce an ad-supported Disney+ service, new pricing model and
price increases and cost realignment; in March 2021, we announced the closure of a substantial number of our Disney-branded

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retail stores; and we have announced exploration of a number of new types of businesses. In addition, with the recent change in
leadership, there may be additional adjustments to our business strategies. Our new organization and strategies are, among other
things, subject to execution risk and may not produce the anticipated benefits, such as supporting our growth strategies and
enhancing shareholder value. For example, notwithstanding our announced plans to rationalize costs, the costs of our DTC
strategy, and associated losses, may continue to grow or be reduced more slowly than anticipated, which may impact our
distribution strategy across businesses/distribution platforms, the types of content we distribute through various businesses/
distribution platforms, and the timing and sequencing of content windows. Our new organization and strategies could be less
successful than our previous organizational structure and strategies. In addition, external events including changing technology,
changing consumer purchasing patterns, acceptance of content offerings and changes in macroeconomic conditions may impair
the value of our assets. When these changes or events occur, we have incurred and may continue to incur costs to change our
business strategy and have needed and may in the future need to write-down the value of assets. For example, current
conditions, including COVID-19 and our business decisions, have reduced the value of some of our assets. We have impaired
goodwill and intangible assets at our International Channels businesses and impaired the value of certain of our retail store
assets. We may write-down other assets as our strategy evolves to account for the current business environment. We also make
investments in existing or new businesses, including investments in international expansion of our business and in new business
lines. In recent years, such investments have included expansion and renovation of certain of our theme parks, expansion of our
fleet of cruise ships, the acquisition of TFCF and investments related to DTC offerings. Some of these investments have returns
that are negative or low, the ultimate business prospects of the businesses related to these investments are uncertain, these
investments may impact the profitability of our other businesses, and these risks are exacerbated by COVID-19. In any of these
events, our costs may increase, we may have significant charges associated with the write-down of assets or returns on new
investments may be negative or lower than prior to the change in strategy or restructuring. Even if our strategies are effective in
the long term, our new offerings will generally not be profitable in the short term, growth of our new offerings is unlikely to be
even quarter over quarter and we may not expand into new markets as or when anticipated. Our ability to forecast for new
businesses may be impacted by our lack of experience operating in those new businesses, speed with which the competitive
landscape changes, volatility beyond our control (such as the events beyond our control noted above) and our ability to obtain
or develop the content and rights on which our projections are based. Accordingly, we may not achieve our forecasted
outcomes.
Increased competitive pressures may reduce our revenues or increase our costs.
We face substantial competition in each of our businesses from alternative providers of the products and services we offer
and from other forms of entertainment, lodging, tourism and recreational activities. This includes, among other types,
competition for human resources, content and other resources we require in operating our business. For example:
• Our programming and production operations compete to obtain creative, performing and business talent, sports and
other programming, story properties, advertiser support and market share with other studio operators, television
networks, SVOD providers and other new sources of broadband delivered content.
• Our television networks and stations and DTC offerings compete for the sale of advertising time with other television
and SVOD services, as well as with newspapers, magazines, billboards and radio stations. In addition, we increasingly
face competition for advertising sales from internet and mobile delivered content, which offer advertising delivery
technologies that are more targeted than can be achieved through traditional means.
• Our television networks compete for carriage of their programming with other programming providers.
• Our theme parks and resorts compete for guests with all other forms of entertainment, lodging, tourism and recreation
activities.
• Our content sales/licensing operations compete for customers with all other forms of entertainment.
• Our consumer products business competes with other licensors and creators of IP.
• Our DTC businesses compete for customers with an increasing number of competitors’ DTC offerings, all other forms
of media and all other forms of entertainment, as well as for technology, creative, performing and business talent and
for content.
Competition in each of these areas may further increase as a result of technological developments and changes in market
structure, including consolidation of suppliers of resources and distribution channels. Increased competition may increase the
cost of programming and other products and divert consumers from our creative or other products, or to other products or other
forms of entertainment, which could reduce our revenue or increase our marketing costs.
Competition for the acquisition of resources can further increase the cost of producing our products and services, deprive
us of talent necessary to produce high quality creative material or increase the cost of compensation for our employees. Such
competition may also reduce, or limit growth in, prices for our products and services, including advertising rates and
subscription fees at our media networks and DTC offerings, parks and resorts admissions and room rates and prices for
consumer products from which we derive license revenues.

23
Our results may be adversely affected if long-term programming or carriage contracts are not renewed on sufficiently
favorable terms.
We enter into long-term contracts for both the acquisition and the distribution of media programming and products,
including contracts for the acquisition of programming rights for sporting events and other programs, and contracts for the
distribution of our programming to content distributors. As these contracts expire, we must renew or renegotiate the contracts,
and if we are unable to renew them on acceptable terms, we may lose programming rights or distribution rights. As a result, our
portfolio of programming rights and the distributors of our programming have changed and may continue to change over time.
Even if these contracts are renewed, the cost of obtaining certain programming rights has increased and may continue to
increase (or increase at faster rates than our historical experience) and programming distributors, facing pressures resulting from
increased subscription fees and alternative distribution challenges, have demanded and may continue to demand terms
(including pricing and the breadth of distribution) that reduce our revenue from distribution of programs (or increase revenue at
slower rates than our historical experience). Moreover, our ability to renew these contracts on favorable terms may be affected
by a number of factors, such as consolidation in the market for program distribution, the entrance of new participants in the
market for distribution of content on digital platforms and the impacts of COVID-19. With respect to the acquisition of
programming rights, particularly sports programming rights, the impact of these long-term contracts on our results over the
term of the contracts depends on a number of factors, including the strength of advertising markets, subscription levels and rates
for programming, effectiveness of marketing efforts and the size of viewer audiences. There can be no assurance that revenues
from programming based on these rights will exceed the cost of the rights plus the other costs of producing and distributing the
programming.
Changes in regulations applicable to our businesses may impair the profitability of our businesses.
Our broadcast networks and television stations are highly regulated, and each of our other businesses is subject to a
variety of U.S. and overseas regulations. Some of these regulations include:
• U.S. FCC regulation of our television and radio networks, our national programming networks and our owned
television stations. See Item 1 — Business — Disney Media and Entertainment Distribution, Federal Regulation.
• Federal, state and foreign privacy and data protection laws and regulations.
• Regulation of the safety and supply chain of consumer products and theme park operations, including potential
regulation regarding the sourcing, importation and the sale of goods.
• Environmental protection regulations.
• U.S. and international anti-corruption laws, sanction programs and trade restrictions, restrictions on the manner in
which content is currently licensed and distributed, ownership restrictions, currency exchange controls or film or
television content requirements, investment obligations or quotas.
• Domestic and international labor laws, tax laws or currency controls.
New laws and regulations, as well as changes in any of these current laws and regulations or regulator activities in any of
these areas, or others, may require us to spend additional amounts to comply with the regulations, or may restrict our ability to
offer products and services in ways that are profitable, and create an increasingly unpredictable regulatory landscape. For
example, in 2019 India implemented regulation and tariffs impacting certain bundling of channels; in 2022 the U.S. and other
countries implemented a series of sanctions against Russia in response to events in Russia and Ukraine; U.S. agencies have
enhanced trade restrictions and legislation is currently under consideration that would prohibit importation of goods from
certain regions; U.S. state governments have become more active in passing legislation targeted at specific sectors and
companies; and in many countries/regions around the world (including but not limited to the EU) regulators are requiring us to
broadcast on our linear (or display on our DTC streaming services) programming produced in specific countries as well as
invest specified amounts of our revenues in local content productions.
Public health and other regional, national, state and local regulations and policies are impacting our ability to operate our
businesses at all or in accordance with historic practice. In addition to the government requirements that have impacted most of
our businesses as a result of COVID-19, government requirements may continue to be extended and new government
requirements may be imposed to address COVID-19 or future health outbreaks or pandemics.
Our operations outside the U.S. may be adversely affected by the operation of laws in those jurisdictions.
Our operations in non-U.S. jurisdictions are in many cases subject to the laws of the jurisdictions in which they operate
rather than, or in addition to, U.S. law. Our risks of operating internationally have increased following the completion of the
TFCF acquisition, which increased the importance of international operations to our future operations, growth and prospects.
Laws in some jurisdictions differ in significant respects from those in the U.S. These differences can affect our ability to react
to changes in our business, and our rights or ability to enforce rights may be different than would be expected under U.S. law.
Moreover, enforcement of laws in some international jurisdictions can be inconsistent and unpredictable, which can affect both
our ability to enforce our rights and to undertake activities that we believe are beneficial to our business. In addition, the
business and political climate in some jurisdictions may encourage corruption, which could reduce our ability to compete

24
successfully in those jurisdictions while remaining in compliance with local laws or U.S. anti-corruption laws applicable to our
businesses. As a result, our ability to generate revenue and our expenses in non-U.S. jurisdictions may differ from what would
be expected if U.S. law alone governed these operations.
Environmental, social and governance matters and any related reporting obligations may impact our businesses.
U.S. and international regulators, investors and other stakeholders are increasingly focused on environmental, social, and
governance (ESG) matters. For example, new domestic and international laws and regulations relating to ESG matters,
including human capital, diversity, sustainability, climate change and cybersecurity, are under consideration or being adopted,
which may include specific, target-driven disclosure requirements or obligations. Our response will require additional
investments and implementation of new practices and reporting processes, all entailing additional compliance risk. In addition,
we have announced a number of ESG initiatives and goals, which will require ongoing investment, and there is no assurance
that we will achieve any of these goals or that our initiatives will achieve their intended outcomes. Consumers’ perceptions of
our efforts to achieve these goals often differ widely and present risks to our reputation and brands. In addition, our ability to
implement some initiatives or achieve some goals is dependent on external factors. For example, our ability to meet certain
sustainability goals or initiatives may depend in part on third-party collaboration, mitigation innovations and/or the availability
of economically feasible solutions at scale.
Damage to our reputation or brands may negatively impact our Company across businesses and regions.
Our reputation and globally recognizable brands are integral to the success of our businesses. Because our brands engage
consumers across our businesses, damage to our reputation or brands in one business may have an impact on our other
businesses. Because some of our brands are globally recognized, brand damage may not be locally contained. Maintenance of
the reputation of our Company and brands depends on many factors including the quality of our offerings, maintenance of trust
with our customers and our ability to successfully innovate. In addition, we may pursue brand or product integration combining
previously separate brands or products targeting different audiences under one brand or pursue other business initiatives
inconsistent with one or more of our brands, and there is no assurance that these initiatives will be accepted by our customers
and not adversely impact one or more of our brands. Significant negative claims or publicity regarding the Company or its
operations, products, management, employees, practices, business partners, business decisions, social responsibility and culture
may materially damage our brands or reputation, even if such claims are untrue. Damage to our reputation or brands could
impact our sales, business opportunities, profitability, recruiting and valuation of our securities.
Various risks may impact the success of our DTC business.
We may not successfully execute on our DTC strategy. The success of our DTC strategy and profitability of our DTC
businesses will be impacted by the success of our efforts to reorganize DMED to advance our DTC strategies, drive subscriber
additions and retention based on the attractiveness of our content, manage churn in reaction to price increases, achieve the
desired financial impact of the Disney+ ad supported service, pricing model and price increases, our ability to execute on cost
realignment and the effects of our determinations with regard to distribution for our creative content across windows. The initial
costs of marketing campaigns are generally recognized in the DMED business/distribution platform of initial exploitation, and
allocation of programming and production costs is driven by distribution of the relevant content across windows. Accordingly,
our distribution determinations impact the costs of each business/distribution channel, including DTC. An increasing number of
competitors have entered DTC businesses. Consumers may not be willing to pay for an expanding set of DTC streaming
services at increasing prices, potentially exacerbated by an economic downturn. In addition, economic downturns negatively
impact the purchase of and price for advertising on our DTC streaming services. We face competition for creative talent and
may not be successful in recruiting and retaining talent, or may face increased costs to do so. Our content may not successfully
attract and retain subscribers in the quantities that we expect. Our content is subject to cost pressures and may cost more than
we expect. We may not successfully manage our costs to meet our profitability goals. Government regulation, including revised
foreign content and ownership regulations, may impact the implementation of our DTC business plans. The highly competitive
environment in which we operate puts pricing pressure on our DTC offerings and may require us to lower our prices or not take
price increases to attract or retain customers or experience higher churn rates. These and other risks may impact the profitability
and success of our DTC businesses.
Potential credit ratings actions, increases in interest rates, or volatility in the U.S. and global financial markets could
impede access to, or increase the cost of, financing our operations and investments.
Our borrowing costs have been, and can be affected by short- and long-term debt ratings assigned by independent ratings
agencies that are based, in part, on the Company’s performance as measured by credit metrics such as leverage and interest
coverage ratios. As a result of the financial impact of COVID-19 on our businesses, Standard and Poor’s downgraded our long-
term debt ratings by two notches to BBB+ and downgraded our short-term debt ratings by one notch to A-2. Fitch downgraded
our long- and short-term credit ratings by one notch to A- and F2, respectively. As of October 1, 2022 Moody’s Investors
Service’s long- and short-term debt ratings for the Company were A2 and P-1 (Stable), respectively, Standard and Poor’s long-
and short-term debt ratings for the Company were BBB+ and A-2 (Positive), respectively, and Fitch’s long- and short-term debt
ratings for the Company were A- and F2 (Stable), respectively. These ratings actions have increased, and any potential future

25
downgrades could further increase, our cost of borrowing and/or make it more difficult for us to obtain financing on acceptable
terms.
In addition, increases in interest rates have increased our cost of borrowing and volatility in U.S. and global financial
markets could impact our access to, or further increase the cost of, financing. Past disruptions in the U.S. and global credit and
equity markets made it more difficult for many businesses to obtain financing on acceptable terms. These conditions tended to
increase the cost of borrowing and if they recur, our cost of borrowing could increase and it may be more difficult to obtain
financing for our operations or investments.
Labor disputes may disrupt our operations and adversely affect the profitability of any of our businesses.
A significant number of employees in various parts of our businesses, including employees of our theme parks and
writers, directors, actors, and production personnel for our productions are covered by collective bargaining agreements. In
addition, some of our employees outside the U.S. are represented by works councils, trade unions or other employee
associations. Further, the employees of licensees who manufacture and retailers who sell our consumer products, and
employees of providers of programming content (such as sports leagues) may be covered by labor agreements with their
employers. In general, a labor dispute involving our employees or the employees of our licensees or retailers who sell our
consumer products or providers of programming content may disrupt our operations and reduce our revenues. Resolution of
disputes or negotiation of rate increases may increase our costs.
The seasonality of certain of our businesses and timing of certain of our product offerings could exacerbate negative
impacts on our operations.
Each of our businesses is normally subject to seasonal variations and variations in connection with the timing of our
product offerings, including as follows:
• Revenues at DPEP fluctuate with changes in theme park attendance and resort occupancy resulting from the seasonal
nature of vacation travel and leisure activities and seasonal consumer purchasing behavior, which generally results in
increased revenues during the Company’s first and fourth fiscal quarters. Peak attendance and resort occupancy
generally occur during the summer months when school vacations occur and during early winter and spring holiday
periods. In addition, licensing revenues fluctuate with the timing and performance of our theatrical releases and cable
programming broadcasts, many of which have been delayed, canceled or modified.
• Revenues from television networks and stations are subject to seasonal advertising patterns and changes in viewership
levels. In general, advertising revenues are somewhat higher during the fall and somewhat lower during the summer
months.
• Revenues from content sales/licensing fluctuate due to the timing of content releases across various distribution
markets. Release dates and methods are determined by a number of factors, including, among others, competition, the
timing of vacation and holiday periods and impacts of COVID-19 to various distribution markets.
• DTC revenues fluctuate based on changes in the number of subscribers and subscriber fee or revenue mix; viewership
levels on our digital platforms; and the demand for sports and film and television content. Each of these may depend
on the availability of content, which varies from time to time throughout the year based on, among other things, sports
seasons, content production schedules and league shut downs. Because our DTC business is relatively new, we have
limited data on which to base our understanding of DTC seasonality.
Accordingly, negative impacts on our business occurring during a time of typical high seasonal demand such as our park
closures due to COVID-19 restrictions or hurricane damage during the summer travel season or other high seasons, could have
a disproportionate effect on the results of that business for the year.
Costs of employee health, welfare and pension benefits, including postretirement medical benefits for some employees
and retirees, may reduce our profitability.
With approximately 220,000 employees, our profitability is substantially affected by costs of our health, welfare and
pension benefits, including the costs of medical benefits for current employees and the costs of postretirement medical benefits
for some current employees and retirees. We may experience significant increases in these costs as a result of macroeconomic
factors, which are beyond our control, including increases in the cost of health care. Impacts of COVID-19 or future health
outbreaks and pandemics may lead to an increase in the cost of medical insurance and expenses. In addition, changes in
investment returns and discount rates used to calculate pension and postretirement medical expense and related assets and
liabilities can be volatile and may have an unfavorable impact on our costs in some years. These macroeconomic factors as well
as a decline in the fair value of pension and postretirement medical plan assets may put upward pressure on the cost of
providing pension and postretirement medical benefits and may increase future funding requirements. There can be no
assurance that we will succeed in limiting cost increases, and continued upward pressure could reduce the profitability of our
businesses.

26
ACQUISITION RISKS
Our consolidated indebtedness increased substantially following completion of the TFCF acquisition and further
increased as a result of the impacts of COVID-19. This increased level of indebtedness could adversely affect us,
including by decreasing our business flexibility.
As a result of the TFCF acquisition in fiscal 2019, the Company’s net indebtedness increased substantially. The increased
indebtedness could have the effect of, among other things, reducing our financial flexibility and reducing our flexibility to
respond to changing business and economic conditions, such as those presented by COVID-19, among others. Increased levels
of indebtedness could also reduce funds available for investments, capital expenditures, share repurchases and dividends, and
other activities and may create competitive disadvantages for us relative to other companies with lower debt levels. Our
leverage ratios have increased as the result of COVID-19’s impact on financial performance, which caused certain of the credit
ratings agencies to downgrade their assessment of our credit ratings, and are expected to remain elevated at least in the near
term. Our debt ratings may be further downgraded, which may negatively impact our cost of borrowings.
The TFCF acquisition and integration and Hulu put/call may result in additional costs and expenses.
We have incurred and may continue to incur significant costs, expenses and fees for professional services and other
transaction and financing costs in connection with the TFCF acquisition and integration and the Hulu put/call agreement with
NBCU. We may also incur accounting and other costs that were not anticipated at the time of the TFCF acquisition, including
costs for which we have established reserves or which may lead to reserves in the future. Such costs, including the Company’s
obligations under the Hulu put/call agreement with NBCU, could negatively impact the Company’s free cash flow and result in
the Company incurring additional indebtedness.

GENERAL RISKS
The price of our common stock has been, and may continue to be, volatile.
The price of our common stock has experienced substantial volatility and may continue to be volatile. Various factors
have impacted, and may continue to impact, the price of our common stock, including, among others, changes in management;
variations in our operating results; variations between our actual results and expectations of securities analysts; changes in our
estimates, guidance or business plans; changes in financial estimates and recommendations by securities analysts; the activities,
operating results or stock price of our competitors or other industry participants in the industries in which we operate; the
announcement or completion of significant transactions by us or a competitor; events affecting the stock market generally; and
the economic and political conditions in the U.S. and internationally, as well as other factors described in this Item 1A. Some of
these factors may adversely impact the price of our common stock, regardless of our operating performance. Further, volatility
in the price of our common stock may negatively impact one or more of our businesses, including by increasing cash
compensation or stock awards for our employees who participate in our stock incentive programs or limiting our financing
options for acquisitions and other business expansion.

The Company’s amended and restated bylaws provide to the fullest extent permitted by law that the Court of Chancery
of the State of Delaware will be the exclusive forum for certain legal actions between the Company and its stockholders,
which could increase costs to bring a claim, discourage claims or limit the ability of the Company’s stockholders to
bring a claim in a judicial forum viewed by the stockholders as more favorable for disputes with the Company or the
Company’s directors, officers or other employees.
The Company’s amended and restated bylaws provide to the fullest extent permitted by law that unless the Company
consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and
exclusive forum for any (i) derivative action or proceeding brought on behalf of the Company, (ii) any action or proceeding
asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or stockholder of the Company to
the Company or the Company’s stockholders, (iii) any action or proceeding asserting a claim arising pursuant to, or seeking to
enforce any right, obligation or remedy under, any provision of the General Corporation Law of the State of Delaware (the
“DGCL”), the Certificate of Incorporation or these Bylaws (as each may be amended from time to time), (iv) any action or
proceeding as to which the General Corporation Law of the State of Delaware confers jurisdiction on the Court of Chancery of
the State of Delaware, (v) or any action or proceeding asserting a claim governed by the internal affairs doctrine. The choice of
forum provision may increase costs to bring a claim, discourage claims or limit a stockholder’s ability to bring a claim in a
judicial forum that it finds favorable for disputes with the Company or the Company’s directors, officers or other employees,
which may discourage such lawsuits against the Company or the Company’s directors, officers and other employees.
Alternatively, if a court were to find the choice of forum provision contained in the Company’s amended and restated bylaws to
be inapplicable or unenforceable in an action, the Company may incur additional costs associated with resolving such action in
other jurisdictions. The exclusive forum provision in the Company’s amended and restated bylaws will not preclude or contract
the scope of exclusive federal or concurrent jurisdiction for actions brought under the federal securities laws including the
Securities Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended, or the respective rules and regulations
promulgated thereunder.

27
ITEM 1B. Unresolved Staff Comments
The Company has received no written comments regarding its periodic or current reports from the staff of the SEC that
were issued 180 days or more preceding the end of fiscal 2022 that remain unresolved.

ITEM 2. Properties
Our parks and resorts locations and other properties of the Company and its subsidiaries are described in Item 1 under the
caption Disney Parks, Experiences and Products. Film and television library properties and television stations owned by the
Company are described in Item 1 under the caption Disney Media and Entertainment Distribution.
The Company and its subsidiaries own and lease properties throughout the world. In addition to the properties noted
above, the table below provides a brief description of other significant properties and the related business segment.
Property /
Location Approximate Size Use Business Segment
Burbank, CA & surrounding Land (201 acres) & Buildings Owned Office/Production/ Corporate/DMED/DPEP
cities(1) (4,695,000 ft2) Warehouse (includes 240,000 ft2
sublet to third-party tenants)

Burbank, CA & surrounding Buildings (1,821,000 ft2) Leased Office/Warehouse Corporate/DMED/DPEP

cities(1)

Los Angeles, CA Land (22 acres) & Buildings Owned Office/Production/Technical Corporate/DMED
(600,000 ft2) Warehouse

Los Angeles, CA Buildings (3,051,000 ft2) Leased Office/Production/ Corporate/DMED/DPEP

Technical/Theater

New York, NY Buildings (51,000 ft2) Owned Office Corporate/DMED

New York, NY Land (2 acres) & Buildings Leased Office/Production/Theater/ Corporate/DMED/DPEP

(2,186,000 ft2) Warehouse (includes 679,000 ft2
sublet to third-party tenants)

Bristol, CT Land (117 acres) & Buildings Owned Office/Production/Technical DMED

(1,174,000 ft2)

Bristol, CT Buildings (512,000 ft2) Leased Office/Warehouse/Technical DMED

Emeryville, CA Land (20 acres) & Buildings Owned Office/Production/Technical DMED

(430,000 ft2)

Emeryville, CA Buildings (80,000 ft2) Leased Office/Storage DMED

San Francisco, CA Buildings (638,000 ft2) Leased Office/Production/ Corporate/DMED

Technical/Theater (includes 47,000
ft2 sublet to third-party tenants)

USA & Canada Land and Buildings (Multiple Owned and Leased Office/ Corporate/DMED/DPEP
sites and sizes) Production/Transmitter/Theaters/
Warehouse

Europe, Asia, Australia & Buildings (Multiple sites and Leased Office/Warehouse/Retail/ DMED/DPEP
Latin America sizes) Residential
(1)
Surrounding cities include Glendale, CA, North Hollywood, CA and Sun Valley, CA

ITEM 3. Legal Proceedings

As disclosed in Note 14 to the Consolidated Financial Statements, the Company is engaged in certain legal matters, and
the disclosure set forth in Note 14 relating to certain legal matters is incorporated herein by reference.
The Company, together with, in some instances, certain of its directors and officers, is a defendant in various other legal
actions involving copyright, breach of contract and various other claims incident to the conduct of its businesses. Management
does not expect the Company to suffer any material liability by reason of these actions.

28
ITEM 4. Mine Safety Disclosures
Not applicable.

Information About Our Executive Officers

The executive officers of the Company are elected each year at the organizational meeting of the Board of Directors,
which follows the annual meeting of the shareholders, and at other Board of Directors meetings, as appropriate. Each of the
executive officers has been employed by the Company in the position or positions indicated in the list and pertinent notes
below.
As of November 20, 2022, the following individuals have served as executive officers since the beginning of our last
fiscal year:
Executive
Name Age Title Officer Since
Robert A. Iger 71 Chief Executive Officer(1) 11/20/2022

Robert A. Chapek 63 Chief Executive Officer(2) 2020 -

11/20/2022
Christine M. McCarthy 67 Senior Executive Vice President and Chief Financial Officer(3) 2005
(4)
Horacio E. Gutierrez 57 Senior Executive Vice President and General Counsel 2022
(5)
Paul J. Richardson 57 Senior Executive Vice President and Chief Human Resources Officer 2021
(6)
Kristina K. Schake 52 Senior Executive Vice President and Chief Communications Officer 2022
(1)
Mr. Iger was appointed Chief Executive Officer effective November 20, 2022. He previously served as Executive
Chairman of the Company from February 2020 through December 2021 and as Chief Executive Officer of the
Company from September 2005 to February 2020.
(2)
Mr. Chapek was appointed Chief Executive Officer effective February 24, 2020 and served as Chief Executive Officer
until November 20, 2022. He served as Chairman of Disney Parks, Experiences and Products since the segment’s
creation in 2018, and prior to that was the Chairman of Walt Disney Parks and Resorts from 2015.
(3)
Ms. McCarthy was appointed Senior Executive Vice President and Chief Financial Officer effective June 30, 2015.
She was previously Executive Vice President, Corporate Real Estate, Alliances and Treasurer of the Company from
2000 to 2015.
(4)
Mr. Gutierrez was appointed Senior Executive Vice President and General Counsel effective February 1, 2022. Prior to
joining the Company, he served as Head of Global Affairs and Chief Legal Officer for Spotify Technology S.A.
(Spotify) from November 2019 to January 2022, where he led a global, multi-disciplinary team of business, corporate
communications and public affairs, government relations, licensing, operations and legal professionals responsible for
the company’s work in areas including industry relations, content partnerships, public policy, and trust & safety. He
was previously Spotify’s General Counsel - Vice President, Business & Legal Affairs from April 2016 to November
2019.
(5)
Mr. Richardson was appointed Senior Executive Vice President and Chief Human Resources Officer effective July 1,
2021. He was previously Senior Vice President of Human Resources at ESPN from 2007.
(6)
Ms. Schake was appointed Senior Executive Vice President and Chief Communications Officer effective June 29,
2022. Previously, she served as Executive Vice President, Global Communications from April 2022. Prior to joining
the Company, she was appointed by the President of the United States as Counselor for Strategic Communications to
the Secretary of the U.S. Department of Health and Human Services, leading a nationwide public education campaign
from March 2021 to December 2021. Prior to that, she served as Global Communications Director for Instagram, a
subsidiary of Meta Platforms, Inc., from March 2017 to March 2019, where she oversaw the communications teams in
North America, Latin America, Europe, and Asia.

29
 PART II

ITEM 5. Market for the Company’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
The Company’s common stock is listed on the New York Stock Exchange under the ticker symbol “DIS”.
The Company paid a dividend of $1.6 billion in fiscal year 2020 related to operations in the second half of fiscal 2019.
The Company did not pay a dividend with respect to fiscal year 2020 nor fiscal year 2021 operations and has not declared or
paid a dividend with respect to fiscal 2022 operations.
As of October 1, 2022, the approximate number of common shareholders of record was 793,000.
The following table provides information about Company purchases of equity securities that are registered by the
Company pursuant to Section 12 of the Exchange Act during the quarter ended October 1, 2022:
Total Number Maximum
of Shares Number of
Purchased Shares that
as Part of May Yet Be
Publicly Purchased
Total Number Weighted Announced Under the
of Shares Average Price Plans or Plans or
Period Purchased(1) Paid per Share Programs Programs(2)
July 3, 2022 – July 31, 2022 30,343 $ 100.81 — n/a
August 1, 2022 – August 31, 2022 22,440 119.99 — n/a
September 1, 2022 – October 1, 2022 23,058 107.38 — n/a
Total 75,841 108.48 — n/a
(1)
75,841 shares were purchased on the open market to provide shares to participants in the Walt Disney Investment Plan.
These purchases were not made pursuant to a publicly announced repurchase plan or program.
(2)
Not applicable as the Company no longer has a stock repurchase plan or program.

ITEM 6. [Reserved]

30
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

CONSOLIDATED RESULTS
(in millions, except per share data)
% Change
Better
2022 2021 (Worse)
Revenues:
Services $ 74,200 $ 61,768 20 %
Products 8,522 5,650 51 %
Total revenues 82,722 67,418 23 %
Costs and expenses:
Cost of services (exclusive of depreciation and amortization) (48,962) (41,129) (19) %
Cost of products (exclusive of depreciation and amortization) (5,439) (4,002) (36) %
Selling, general, administrative and other (16,388) (13,517) (21) %
Depreciation and amortization (5,163) (5,111) (1) %
Total costs and expenses (75,952) (63,759) (19) %
Restructuring and impairment charges (237) (654) 64 %
Other income (expense), net (667) 201 nm
Interest expense, net (1,397) (1,406) 1 %
Equity in the income of investees, net 816 761 7 %
Income from continuing operations before income taxes 5,285 2,561 >100 %
Income taxes from continuing operations (1,732) (25) >(100) %
Net income from continuing operations 3,553 2,536 40 %
Loss from discontinued operations, net of income tax benefit of $14 and $9,
(48) (29) (66) %
respectively
Net income 3,505 2,507 40 %
Net income from continuing operations attributable to noncontrolling and
(360) (512) 30 %
redeemable noncontrolling interests
Net income attributable to Disney $ 3,145 $ 1,995 58 %

Earnings (loss) per share attributable to Disney:

Diluted(1)
Continuing operations $ 1.75 $ 1.11 58 %
Discontinued operations (0.03) (0.02) (50) %
$ 1.72 $ 1.09 58 %

Basic(1)
Continuing operations $ 1.75 $ 1.11 58 %
Discontinued operations (0.03) (0.02) (50) %
$ 1.73 $ 1.10 57 %

Weighted average number of common and common equivalent shares outstanding:

Diluted 1,827 1,828
Basic 1,822 1,816
(1)
Total may not equal the sum of the column due to rounding.

31
Organization of Information
Management’s Discussion and Analysis provides a narrative on the Company’s financial performance and condition that
should be read in conjunction with the accompanying financial statements. It includes the following sections:
• Significant Developments
• Consolidated Results and Non-Segment Items
• Business Segment Results
• Corporate and Unallocated Shared Expenses
• Restructuring Activities
• Liquidity and Capital Resources
• Supplemental Guarantor Financial Information
• Critical Accounting Policies and Estimates
In Item 7, we discuss fiscal 2022 and 2021 results and comparisons of fiscal 2022 results to fiscal 2021 results.
Discussions of fiscal 2020 results and comparisons of fiscal 2021 results to fiscal 2020 results can be found in “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report
on Form 10-K for the fiscal year ended October 2, 2021.

SIGNIFICANT DEVELOPMENTS

Leadership Change and Pending Restructuring

As previously announced, on November 20, 2022, Robert A. Iger returned to the Company as Chief Executive Officer
(“CEO”) and a director. Mr. Iger previously spent more than four decades at the Company, including 15 years as CEO. In
announcing Mr. Iger’s appointment, the Company noted he has agreed to serve as CEO for two years, with a mandate from the
Company’s Board of Directors “to set the strategic direction for renewed growth and to work closely with the Board in
developing a successor to lead the Company at the completion of his term.” Mr. Iger succeeded Robert A. Chapek, who had
served as CEO since 2020.
As contemplated by the leadership change announcement, we anticipate that within the coming months Mr. Iger will
initiate organizational and operating changes within the Company to address the Board’s goals. While the plans are in early
stages, changes in our structure and operations, including within DMED (and including possibly our distribution approach and
the businesses/distribution platforms selected for the initial distribution of content), can be expected. The restructuring and
change in business strategy, once determined, could result in impairment charges.

COVID-19 Pandemic
Since early 2020, the world has been, and continues to be, impacted by COVID-19 and its variants. COVID-19 and
measures to prevent its spread have impacted our segments in a number of ways, most significantly at DPEP where our theme
parks and resorts were closed and cruise ship sailings and guided tours were suspended. In addition, at DMED we delayed, or in
some cases, shortened or cancelled theatrical releases and experienced disruptions in the production and availability of content.
Operations have resumed at various points since May 2020, with certain theme park and resort operations and film and
television productions resuming by the end of fiscal 2020 and throughout fiscal 2021. Although operations resumed, many of
our businesses continue to experience impacts from COVID-19, such as incremental health and safety measures and related
increased expenses, capacity restrictions and closures (including at some of our international parks and in theaters in certain
markets), and disruption of content production activities.
The impact of COVID-19 related disruptions on our financial and operational results will be dictated by the currently
unknowable duration and severity of COVID-19 and its variants, and among other things, governmental actions imposed in
response to COVID-19 and individuals’ and companies’ risk tolerance regarding health matters going forward. We have
incurred and will continue to incur additional costs to address government regulations and the safety of our employees, guests
and talent.
Additionally, see Part I., Item 1A. Risk Factors - The adverse impact of COVID-19 on our businesses will continue for an
unknown length of time and may continue to impact certain of our key sources of revenue.

CONSOLIDATED RESULTS AND NON-SEGMENT ITEMS

Revenues for fiscal 2022 increased 23%, or $15.3 billion, to $82.7 billion; net income attributable to Disney increased
$1.2 billion, to income of $3.1 billion; and diluted earnings per share from continuing operations attributable to Disney
increased to income of $1.75 compared to income of $1.11 in the prior year. The EPS increase was due to higher segment

32
operating results, partially offset by higher income tax expense in the current year compared to the prior year. Higher segment
operating results reflecting growth at DPEP, partially offset by lower operating results at DMED.
Revenues
Service revenues for fiscal 2022 increased 20%, or $12.4 billion, to $74.2 billion, due to increased revenues at our theme
parks and resorts, higher DTC subscription revenue and, to a lesser extent, higher theatrical distribution and advertising
revenue. These increases were partially offset by a reduction in revenue for amounts to early terminate certain license
agreements with a customer for film and television content, which was delivered in previous years, in order for the Company to
use the content primarily on our DTC services (Content License Early Termination). The increase at theme parks and resorts
was due to higher volumes, which generally reflected the impact of operating with capacity restrictions in the prior year as a
result of COVID-19, and higher average per capita ticket revenue. The increase in DTC subscription revenue was due to
subscriber growth and higher average rates.
Product revenues for fiscal 2022 increased 51%, or $2.9 billion, to $8.5 billion, due to higher sales volumes of
merchandise, food and beverage at our theme parks and resorts.
Costs and expenses
Cost of services for fiscal 2022 increased 19%, or $7.8 billion, to $49.0 billion, due to higher programming and
production costs, increased volumes at our theme parks and resorts and higher technical support costs at Direct-to-Consumer.
The increase in programming and production costs was due to higher costs at Direct-to-Consumer, increased sports
programming costs and an increase in production cost amortization due to theatrical revenue growth. These increases were
partially offset by lower programming and production costs as a result of international channel closures.
Cost of products for fiscal 2022 increased 36%, or $1.4 billion, to $5.4 billion, due to higher merchandise, food and
beverage sales at our theme parks and resorts.
Selling, general, administrative and other costs for fiscal 2022 increased 21%, or $2.9 billion, to $16.4 billion, primarily
due to higher marketing costs at our DTC and, to a lesser extent, theatrical distribution and parks and experiences businesses.
Restructuring and Impairment Charges
Restructuring and impairment charges in fiscal 2022 were $0.2 billion primarily due to the impairment of an intangible
and other assets related to our businesses in Russia. We may incur additional charges to exit these businesses, which are not
anticipated to be material.
Restructuring and impairment charges in fiscal 2021 were $0.7 billion due to $0.4 billion of asset impairments and
severance costs related to the shut-down of an animation studio and the closure of a substantial number of Disney-branded retail
stores in North America and Europe and $0.3 billion of severance and other costs in connection with the integration of TFCF
and workforce reductions at DPEP.
Other Income (expense), net
% Change
(in millions) 2022 2021 Better (Worse)
fuboTV gain $ — $ 186 (100) %
German FTA gain — 126 (100) %
DraftKings loss (663) (111) >(100) %
Other, net (4) — nm
Other income (expense), net $ (667) $ 201 nm

In fiscal 2022, the Company recognized a non-cash loss of $663 million from the adjustment of its investment in
DraftKings Inc. (DraftKings) to fair value (DraftKings loss).
In fiscal 2021, the Company recognized a $186 million gain from the sale of our investment in fuboTV Inc. (fuboTV
gain), a $126 million gain on the sale of our 50% interest in a German free-to-air (FTA) television network (German FTA gain)
and a $111 million DraftKings loss.

33
Interest Expense, net
% Change
(in millions) 2022 2021 Better (Worse)
Interest expense $ (1,549) $ (1,546) — %
Interest income, investment income and other 152 140 9 %
Interest expense, net $ (1,397) $ (1,406) 1 %

Interest expense was comparable to the prior year as higher average interest rates were offset by lower average debt
balances.
The increase in interest income, investment income and other was due to a favorable comparison of pension and
postretirement benefit costs, other than service cost, which was a net benefit in the current year and an expense in the prior year.
This increase was partially offset by investment losses in the current year compared to investment gains in the prior year.
Equity in the Income of Investees
Equity in the income of investees increased $55 million to $816 million in the current year due to higher income from
A+E Television Networks (A+E) and the comparison to investment impairments in the prior year.
Effective Income Tax Rate

2022 2021
Income from continuing operations before income taxes $ 5,285 $ 2,561
Income tax expense on continuing operations 1,732 25
Effective income tax rate - continuing operations 32.8% 1.0%

The effective income tax rate in the current year was higher than the U.S. statutory rate primarily due to higher effective
tax rates on foreign earnings. The effective income tax rate in the prior year was lower than the U.S. statutory rate due to
favorable adjustments related to prior years and excess tax benefits on employee share-based awards, partially offset by higher
effective tax rates on foreign earnings. Higher effective tax rates on foreign earnings in both the current and prior year reflected
the impact of foreign losses and, to a lesser extent, foreign tax credits for which we are unable to recognize a tax benefit.
Noncontrolling Interests
% Change
(in millions) 2022 2021 Better (Worse)
Net income from continuing operations attributable to
noncontrolling interests $ (360) $ (512) 30%

The decrease in net income from continuing operations attributable to noncontrolling interests was primarily due to higher
losses at Shanghai Disney Resort and higher losses at our DTC sports business, partially offset by higher results for ESPN.
Net income attributable to noncontrolling interests is determined on income after royalties and management fees,
financing costs and income taxes, as applicable.
Certain Items Impacting Results in the Year
Results for fiscal 2022 were impacted by the following:
• TFCF and Hulu acquisition amortization of $2,353 million
• A $1.0 billion reduction in revenue for the Content License Early Termination
• Other expense of $667 million due to the DraftKings loss of $663 million
• Restructuring and impairment charges of $237 million
Results for fiscal 2021 were impacted by the following:
• TFCF and Hulu acquisition amortization of $2,418 million
• Restructuring and impairment charges of $654 million
• Other income of $201 million due to the fuboTV gain of $186 million and the German FTA gain of $126 million,
partially offset by the DraftKings loss of $111 million

34
 A summary of the impact of these items on EPS is as follows:
Pre-Tax Tax Benefit After-Tax EPS Favorable
(in millions, except per share data) Income (Loss) (Expense)(1) Income (Loss) (Adverse)(2)
Year Ended October 1, 2022:
TFCF and Hulu acquisition amortization(3) $ (2,353) $ 549 $ (1,804) $ (0.97)
Contract License Early Termination (1,023) 238 (785) (0.43)
Other income (expense), net (667) 156 (511) (0.28)
Restructuring and impairment charges (237) 55 (182) (0.10)
Total $ (4,280) $ 998 $ (3,282) $ (1.78)

Year Ended October 2, 2021:

TFCF and Hulu acquisition amortization(3) $ (2,418) $ 562 $ (1,856) $ (1.00)
Restructuring and impairment charges (654) 152 (502) (0.27)
Other income (expense), net 201 (46) 155 0.08
Total $ (2,871) $ 668 $ (2,203) $ (1.18)

(1)
Tax benefit (expense) is determined using the tax rate applicable to the individual item.
(2)
EPS is net of noncontrolling interest, where applicable. Total may not equal the sum of the column due to rounding.
(3)
Includes amortization of intangibles related to TFCF equity investees.

BUSINESS SEGMENT RESULTS

Below is a discussion of the major revenue and expense categories for our business segments. Costs and expenses for each
segment consist of operating expenses, selling, general, administrative and other costs, and depreciation and amortization.
Selling, general, administrative and other costs include third-party and internal marketing expenses.
DMED primarily generates revenue across three significant lines of business/distribution platforms: Linear Networks,
Direct-to-Consumer and Content Sales/Licensing. Programming and production costs to support these businesses/distribution
platforms are largely incurred across four content creation groups: Studios, General Entertainment, Sports and International.
Programming and production costs include amortization of licensed programming rights (including sports rights), amortization
of capitalized production costs, subscriber-based fees for programming our Hulu services, production costs related to live
programming such as news and sports and amortization of participations and residual obligations. These costs are generally
allocated across the DMED businesses based on the estimated relative value of the distribution windows. The initial costs of
marketing campaigns are generally recognized in the DMED business/distribution platform of initial exploitation. We have
taken an intentionally flexible approach to distribution. As we refine and adjust our plans, our decisions may impact the results
of operations of the businesses within DMED, including cost allocation, revenue timing, viewership timing and patterns, the
total mix of content on a business/distribution platform or other aspects relevant to the performance of each business/
distribution platform. For example, a shift in the timing or planned business/platform of distribution impacts the timing and
allocation of programming, production and marketing costs.
The Linear Networks business generates revenue from affiliate fees and advertising sales and from fees from sub-
licensing of sports programming to third parties. Operating expenses include programming and production costs, technology
support costs, operating labor and distribution costs.
The Direct-to-Consumer business generates revenue from subscription fees, advertising sales and pay-per-view and
Premier Access fees. Operating expenses include programming and production costs, technology support costs, operating labor
and distribution costs. Operating expenses also include fees paid to Linear Networks for the right to air the linear network feeds
and other services.
The Content Sales/Licensing business generates revenue from the sale of film and episodic television content in the TV/
SVOD and home entertainment markets, distribution of films in the theatrical market, licensing of our music rights, sales of
tickets to stage play performances and licensing of our IP for use in stage plays. Operating expenses include programming and
production costs, distribution expenses and costs of sales.
DPEP primarily generates revenue from the sale of admissions to theme parks, the sale of food, beverage and merchandise
at our theme parks and resorts, charges for room nights at hotels, sales of cruise vacations, sales and rentals of vacation club
properties, royalties from licensing our IP for use on consumer goods and the sale of branded merchandise. Revenues are also
generated from sponsorships and co-branding opportunities, real estate rent and sales, and royalties from Tokyo Disney Resort.

35
Significant expenses include operating labor, costs of goods sold, infrastructure costs, depreciation and other operating
expenses. Infrastructure costs include technology support costs, repairs and maintenance, utilities and fuel, property taxes, retail
occupancy costs, insurance and transportation. Other operating expenses include costs for such items as supplies, commissions
and entertainment offerings.
The Company evaluates the performance of its operating segments based on segment operating income, and management
uses total segment operating income as a measure of the overall performance of the operating businesses separate from non-
operating factors. Total segment operating income is not a financial measure defined by GAAP, should be reviewed in
conjunction with the relevant GAAP financial measure and may not be comparable to similarly titled measures reported by
other companies. The Company believes that information about total segment operating income assists investors by allowing
them to evaluate changes in the operating results of the Company’s portfolio of businesses separate from non-operational
factors that affect net income, thus providing separate insight into both operations and other factors that affect reported results.
The following table reconciles revenues to segment revenues:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues $ 82,722 $ 67,418 23 %
Content License Early Termination 1,023 — nm
Total segment revenues $ 83,745 $ 67,418 24 %

The following table reconciles income from continuing operations before income taxes to total segment operating income:
% Change
(in millions) 2022 2021 Better (Worse)
Income from continuing operations before income taxes $ 5,285 $ 2,561 >100 %
Add (subtract):
Content License Early Termination 1,023 — nm
Corporate and unallocated shared expenses 1,159 928 (25) %
Restructuring and impairment charges 237 654 64 %
Other income (expense), net 667 (201) nm
Interest expense, net 1,397 1,406 1 %
TFCF and Hulu acquisition amortization 2,353 2,418 3 %
Total segment operating income $ 12,121 $ 7,766 56 %

The following is a summary of segment revenue and operating income:

% Change
(in millions) 2022 2021 Better (Worse)
Segment Revenues:
Disney Media and Entertainment Distribution $ 55,040 $ 50,866 8 %
Disney Parks, Experiences and Products 28,705 16,552 73 %
Total segment revenues $ 83,745 $ 67,418 24 %
Segment operating income:
Disney Media and Entertainment Distribution $ 4,216 $ 7,295 (42) %
Disney Parks, Experiences and Products 7,905 471 >100 %
Total segment operating income $ 12,121 $ 7,766 56 %

36
Disney Media and Entertainment Distribution
Revenue and operating results for DMED are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues:
Linear Networks $ 28,346 $ 28,093 1 %
Direct-to-Consumer 19,558 16,319 20 %
Content Sales/Licensing and Other 8,146 7,346 11 %
Elimination of Intrasegment Revenue(1) (1,010) (892) (13) %
$ 55,040 $ 50,866 8 %
Segment operating income (loss):
Linear Networks $ 8,518 $ 8,407 1 %
Direct-to-Consumer (4,015) (1,679) >(100) %
Content Sales/Licensing and Other (287) 567 nm
$ 4,216 $ 7,295 (42) %
(1)
Reflects fees received by the Linear Networks from other DMED businesses for the right to air our Linear Networks
and related services.

Linear Networks
Operating results for Linear Networks are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues
Affiliate fees $ 18,535 $ 18,652 (1) %
Advertising 9,128 8,853 3 %
Other 683 588 16 %
Total revenues 28,346 28,093 1 %
Operating expenses (16,902) (16,808) (1) %
Selling, general, administrative and other (3,619) (3,491) (4) %
Depreciation and amortization (145) (168) 14 %
Equity in the income of investees 838 781 7 %
Operating Income $ 8,518 $ 8,407 1 %

Revenues
Affiliate revenue is as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Domestic Channels $ 15,694 $ 15,244 3 %
International Channels 2,841 3,408 (17) %
$ 18,535 $ 18,652 (1) %

The increase in affiliate revenue at the Domestic Channels was due to an increase of 6% from higher contractual rates,
partially offset by a decrease of 4% from fewer subscribers.
The decrease in affiliate revenue at the International Channels was due to decreases of 13% from fewer subscribers driven
by channel closures, and 6% from an unfavorable foreign exchange impact. These decreases were partially offset by an increase
of 2% from higher contractual rates.

37
 Advertising revenue is as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Cable $ 3,880 $ 3,681 5 %
Broadcasting 3,141 3,239 (3) %
Domestic Channels 7,021 6,920 1 %
International Channels 2,107 1,933 9 %
$ 9,128 $ 8,853 3 %

The increase in Cable advertising revenue was due to increases of 3% from higher impressions and 2% from higher rates.
The increase in impressions reflected higher average viewership, partially offset by fewer units delivered.
The decrease in Broadcasting advertising revenue was due to a decrease of 12% from fewer impressions at ABC,
reflecting lower average viewership, partially offset by an increase of 10% from higher rates at ABC.
The increase in International Channels advertising revenue was due to increases of 8% from higher impressions and 7%
from higher rates, partially offset by 7% from an unfavorable foreign exchange impact. The increase in impressions reflected
higher average viewership, partially offset by the impact of channel closures. The increase in average viewership benefited from
airing more cricket matches in the current year. The current year included the International Cricket Council (ICC) T20 World
Cup, more Board of Control for Cricket in India (BCCI) matches and the Asia Cricket Council (ACC) Asia Cup, partially offset
by fewer Indian Premier League (IPL) matches in the current year compared to the prior year. The ICC T20 World Cup
generally occurs every two years and was not held in the prior year due to COVID-19. The ACC Asia Cup was rescheduled
from 2020 to the current year as a result of COVID-19. The increase in BCCI cricket matches aired in the current year was
driven by COVID-19-related cancellations of certain BCCI matches in the prior year.
Other revenue increased $95 million, to $683 million from $588 million, due to sub-licensing fees from ICC T20 World
Cup matches and higher sub-licensing fees from BCCI cricket matches in the current year compared to the prior year.
Costs and Expenses
Operating expenses are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Programming and production costs
Cable $ (9,415) $ (9,353) (1) %
Broadcasting (2,773) (2,767) — %
Domestic Channels (12,188) (12,120) (1) %
International Channels (3,148) (3,139) — %
(15,336) (15,259) (1) %
Other operating expenses (1,566) (1,549) (1) %
$ (16,902) $ (16,808) (1) %

The increase in programming and production costs at Cable was due to higher sports programming costs, largely offset by
lower non-sports programming costs. The increase in sports programming costs was due to higher rights costs for NFL and
College Football Playoffs (CFP) and an increase in sports production costs reflecting the return of ESPN-hosted events, which
were canceled in the prior year due to COVID-19, partially offset by lower rights costs for MLB and NBA programming.
Higher NFL programming costs were due to airing four additional regular season games in the current year compared to the
prior year and contractual rate increases. The increase in CFP rights costs was due to higher contractual rates. Lower MLB
programming costs were due to airing 29 games of the 2022 regular season under our new contract and one 2021 season playoff
game in the current year compared to 92 games of the 2021 regular season in the prior year. The decrease in NBA programming
costs was due to the comparison to airing four games of the 2020 NBA Finals in the first quarter of fiscal 2021 due to
COVID-19, partially offset by contractual rate increases. Fiscal 2021 also included the 2021 NBA Finals and fiscal 2022
included the 2022 NBA finals. Lower non-sports programming costs were due to a lower cost mix of programming at FX
Channels.
Programming and production costs at Broadcasting were comparable to the prior year as higher costs for non-primetime
programming were largely offset by lower costs for primetime programming. Increased costs for non-primetime programming
were primarily due to higher costs for news programming and higher average costs and more hours of sports programming,
while decreased costs for primetime programming were due to lower average costs for reality and scripted programming.

38
 Programming and production costs at the International Channels were comparable to the prior year as an increase in sports
programming costs, reflecting more cricket matches in the current year and higher average costs per match for BCCI and IPL
cricket matches, was largely offset by the impact of channel closures and a favorable foreign exchange impact.
Selling, general administrative and other costs increased $128 million, to $3,619 million from $3,491 million, driven by
higher labor-related costs.
Depreciation and amortization decreased $23 million, to $145 million from $168 million, driven by fully depreciated
assets.
Equity in the Income of Investees
Income from equity investees increased $57 million, to $838 million from $781 million, due to higher income from A+E
and the comparison to impairments in the prior year. The increase at A+E resulted from lower programming costs and higher
program sales, partially offset by decreases in affiliate and advertising revenue and higher marketing costs.
Operating Income from Linear Networks
Operating income increased 1%, to $8,518 million from $8,407 million due to increases at Broadcasting and Cable and
higher income from our equity investees, partially offset by a decrease at the International Channels.
The following table provides supplemental revenue and operating income detail for Linear Networks:
% Change
(in millions) 2022 2021 Better (Worse)
Supplemental revenue detail
Domestic Channels $ 22,957 $ 22,463 2 %
International Channels 5,389 5,630 (4) %
$ 28,346 $ 28,093 1 %
Supplemental operating income detail
Domestic Channels $ 6,785 $ 6,594 3 %
International Channels 895 1,032 (13) %
Equity in the income of investees 838 781 7 %
$ 8,518 $ 8,407 1 %

Direct-to-Consumer
Operating results for Direct-to-Consumer are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues
Subscription fees $ 15,291 $ 12,020 27 %
Advertising 3,733 3,366 11 %
TV/SVOD distribution and other 534 933 (43) %
Total revenues 19,558 16,319 20 %
Operating expenses (17,440) (13,234) (32) %
Selling, general, administrative and other (5,760) (4,435) (30) %
Depreciation and amortization (373) (329) (13) %
Operating Loss $ (4,015) $ (1,679) >(100) %

Revenues
The increase in subscription fees reflected increases of 20% from higher subscribers, due to growth at Disney+, Hulu and
ESPN+, and 9% from higher average rates due to increases in retail pricing at Disney+ and Hulu, partially offset by a decrease
of 2% from an unfavorable foreign exchange impact.
Advertising revenue growth reflected increases of 7% from higher rates due to an increase at Hulu, and to a lesser extent,
at Disney+, and 4% from higher impressions due to increases at Disney+, ESPN+ and Hulu. The increase in impressions at
Disney+ was primarily due to airing the ICC T20 World Cup and ACC Asia Cup in the current year, neither of which were
aired in the prior year.

39
 The decrease in TV/SVOD distribution and other revenue was due to the absence of Disney+ Premier Access revenues in
the current year compared to revenues for Black Widow, Raya and the Last Dragon, Jungle Cruise and Cruella in the prior
year. To a lesser extent, the decrease also reflected lower UFC pay-per-view fees due to lower average buys per event.
The following table presents additional information about our Disney+, ESPN+ and Hulu product offerings(1).
Paid subscribers(2) as of:

October 1, October 2, % Change

(in millions) 2022 2021 Better (Worse)
Disney+
Domestic (U.S. and Canada) 46.4 38.8 20 %
International (excluding Disney+ Hotstar)(3) 56.5 36.0 57 %
Disney+ Core(4) 102.9 74.8 38 %
Disney+ Hotstar 61.3 43.3 42 %
Total Disney+(4) 164.2 118.1 39 %

ESPN+ 24.3 17.1 42 %

Hulu
SVOD Only 42.8 39.7 8 %
Live TV + SVOD 4.4 4.0 10 %
Total Hulu(4) 47.2 43.8 8 %

Average Monthly Revenue Per Paid Subscriber(5) for the fiscal year ended:
% Change
2022 2021 Better (Worse)
Disney+
Domestic (U.S. and Canada) $ 6.34 $ 6.33 — %
International (excluding Disney+ Hotstar)(3) 6.10 5.31 15 %
Disney+ Core 6.22 5.87 6 %
Disney+ Hotstar 0.88 0.68 29 %
Global Disney+ 4.24 4.08 4 %

ESPN+ 4.80 4.57 5 %

Hulu
SVOD Only 12.72 12.86 (1) %
Live TV + SVOD 87.62 81.35 8 %
(1)
In the U.S., Disney+, ESPN+ and Hulu SVOD Only are each offered as a standalone service or as a package that
includes all three services (the SVOD Bundle). Effective December 21, 2021, Hulu Live TV + SVOD includes
Disney+ and ESPN+ (the new Hulu Live TV + SVOD offering), whereas previously, Hulu Live TV + SVOD was
offered as a standalone service or with Disney+ and ESPN+ as optional additions (the old Hulu Live TV + SVOD
offering). Effective March 15, 2022, Hulu SVOD Only is also offered with Disney+ as an optional add-on. Disney+ is
available in more than 150 countries and territories outside the U.S. and Canada. In India and certain other Southeast
Asian countries, the service is branded Disney+ Hotstar. In certain Latin American countries, we offer Disney+ as well
as Star+, a general entertainment SVOD service, which is available on a standalone basis or together with Disney+
(Combo+). Depending on the market, our services can be purchased on our websites, through third-party platforms/
apps or via wholesale arrangements.
(2)
Reflects subscribers for which we recognized subscription revenue. Subscribers cease to be a paid subscriber as of
their effective cancellation date or as a result of a failed payment method. Subscribers to the SVOD Bundle are
counted as a paid subscriber for each service included in the SVOD Bundle and subscribers to the Hulu Live TV +
SVOD offerings are counted as one paid subscriber for each of the Hulu Live TV + SVOD, Disney+ and ESPN+
offerings. A Hulu SVOD Only subscriber that adds Disney+ is counted as one paid subscriber for each of the Hulu
SVOD Only and Disney+ offerings. In Latin America, if a subscriber has either the standalone Disney+ or Star+
service or subscribes to Combo+, the subscriber is counted as one Disney+ paid subscriber. Subscribers include those

40
 who receive a service through wholesale arrangements including those for which we receive a fee for the distribution
of the service to each subscriber of an existing content distribution tier. When we aggregate the total number of paid
subscribers across our DTC streaming services, we refer to them as paid subscriptions.
(3)
Includes the Disney+ service outside the U.S. and Canada and the Star+ service in Latin America.
(4)
Total may not equal the sum of the column due to rounding.
(5)
Average monthly revenue per paid subscriber is calculated based on the average of the monthly average paid
subscribers for each month in the period. The monthly average paid subscribers is calculated as the sum of the
beginning of the month and end of the month paid subscriber count, divided by two. Disney+ average monthly revenue
per paid subscriber is calculated using a daily average of paid subscribers for the period. Revenue includes
subscription fees, advertising (excluding revenue earned from selling advertising spots to other Company businesses)
and premium and feature add-on revenue but excludes Premier Access and Pay-Per-View revenue. The average
revenue per paid subscriber is net of discounts on offerings that carry more than one service. Revenue is allocated to
each service based on the relative retail price of each service on a standalone basis. Revenue for the new Hulu Live TV
+ SVOD offering is allocated to the SVOD services based on the wholesale price of the SVOD Bundle. In general,
wholesale arrangements have a lower average monthly revenue per paid subscriber than subscribers that we acquire
directly or through third-party platforms.
The average monthly revenue per paid subscriber for domestic Disney+ was comparable to the prior year, as an increase
in retail pricing and a lower mix of wholesale subscribers was essentially offset by a higher mix of subscribers to multi-product
offerings.
The average monthly revenue per paid subscriber for international Disney+ (excluding Disney+ Hotstar) increased from
$5.31 to $6.10 due to increases in retail pricing, partially offset by an unfavorable foreign exchange impact.
The average monthly revenue per paid subscriber for Disney+ Hotstar increased from $0.68 to $0.88 driven by higher per-
subscriber advertising revenue and increases in retail pricing, partially offset by a higher mix of wholesale subscribers.
The average monthly revenue per paid subscriber for ESPN+ increased from $4.57 to $4.80 primarily due to an increase
in retail pricing, a lower mix of annual subscribers and higher per-subscriber advertising revenue, partially offset by a higher
mix of subscribers to multi-product offerings.
The average monthly revenue per paid subscriber for the Hulu SVOD Only service decreased from $12.86 to $12.72
driven by lower per-subscriber advertising revenue, a higher mix of subscribers to multi-product offerings and, to a lesser
extent, to promotional offerings, partially offset by an increase in retail pricing.
The average monthly revenue per paid subscriber for the Hulu Live TV + SVOD service increased from $81.35 to $87.62
driven by an increase in retail pricing and higher per-subscriber advertising revenue, partially offset by a higher mix of
subscribers to multi-product offerings.
Costs and Expenses
Operating expenses are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Programming and production costs
Disney+ $ (5,027) $ (2,915) (72) %
Hulu (7,564) (6,680) (13) %
ESPN+ and other (1,564) (1,121) (40) %
Total programming and production costs (14,155) (10,716) (32) %
Other operating expense (3,285) (2,518) (30) %
$ (17,440) $ (13,234) (32) %

The increase in programming and production costs at Disney+ was due to more content provided on the service and, to a
lesser extent, higher average cost programming, which reflected an increased mix of original content.
The increase in programming and production costs at Hulu was due to more content provided on the service and higher
subscriber-based fees for programming the Live TV service, which reflected rate increases and an increase in the number of
subscribers.
The increase in programming and production costs at ESPN+ and other was due to new NHL programming and higher
rights costs for soccer and golf programming.

41
 Other operating expenses increased due to higher technology and distribution costs at Disney+ reflecting growth in
existing markets and, to a lesser extent, expansion to new markets.
Selling, general, administrative and other costs increased $1,325 million, to $5,760 million from $4,435 million, due to
higher marketing costs at Disney+ and Hulu.
Depreciation and amortization increased $44 million, to $373 million from $329 million, primarily due to increased
investment in technology assets at Disney+.
Operating Loss from Direct-to-Consumer
Operating loss from Direct-to-Consumer increased $2,336 million, to $4,015 million from $1,679 million due to a higher
loss at Disney+ and, to a lesser extent, lower operating income at Hulu and a higher loss at ESPN+.

Content Sales/Licensing and Other

Operating results for Content Sales/Licensing and Other are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues
TV/SVOD distribution $ 3,781 $ 4,206 (10) %
Theatrical distribution 1,875 920 >100 %
Home entertainment 820 1,014 (19) %
Other 1,670 1,206 38 %
Total revenues 8,146 7,346 11 %
Operating expenses (5,499) (4,536) (21) %
Selling, general, administrative and other (2,638) (1,963) (34) %
Depreciation and amortization (296) (294) (1) %
Equity in the income of investees — 14 — %
Operating Income (Loss) $ (287) $ 567 nm

Revenues
The decrease in TV/SVOD distribution revenue reflected lower sales volumes, which included the impact from the shift
from licensing our content to third parties to distributing it on our DTC streaming services.
The increase in theatrical distribution revenue was due to more titles released in the current year compared to the prior year
and revenue in the current year from the co-production of Marvel’s Spider-Man: No Way Home. Although COVID-19
continues to impact our theatrical distribution business in certain markets, the impact in fiscal 2021 was more significant due to
theater closures and capacity restrictions in many territories in which we operate. Titles released in the current year included
Doctor Strange In The Multiverse of Madness, Thor: Love and Thunder, Eternals, Encanto and Lightyear. Titles released in the
prior year included Shang-Chi & The Legend of The Ten Rings, Black Widow and Free Guy.
The decrease in home entertainment revenue was due to lower unit sales despite the benefit of more new release titles in
the current year. Net effective pricing was comparable to the prior year as lower unit pricing was offset by a higher mix of new
release titles, which have a higher sales price than catalog titles.
The increase in other revenue was due to more stage play performances in the current year as productions were generally
shut down in the prior year due to COVID-19.
Operating expenses are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Programming and production costs $ (4,215) $ (3,611) (17) %
Distribution costs and cost of goods sold (1,284) (925) (39) %
$ (5,499) $ (4,536) (21) %

The increase in programming and production costs was due to higher production cost amortization, driven by more
theatrical releases, and, to a lesser extent, higher film cost impairments.
Higher cost of goods sold and distribution costs were due to the increased number of stage play performances in the
current year.

42
 Selling, general, administrative and other costs increased $675 million, to $2,638 million from $1,963 million, due to
higher theatrical marketing costs as more titles were released in the current year compared to the prior year.
Operating Income from Content Sales/Licensing and Other
Operating income from Content Sales/Licensing and Other decreased $854 million, to a loss of $287 million from income
of $567 million, primarily due to lower TV/SVOD distribution results, higher film cost impairments and decreases in home
entertainment and theatrical distribution results, partially offset by higher stage play results.
Items Excluded from Segment Operating Income Related to Disney Media and Entertainment Distribution
The following table presents supplemental information for items related to DMED that are excluded from segment
operating income:
% Change
(in millions) 2022 2021 Better (Worse)
TFCF and Hulu acquisition amortization(1) $ (2,345) $ (2,410) 3 %
Content License Early Termination (1,023) — nm
Restructuring and impairment charges(2) (229) (315) 27 %
German FTA gain — 126 (100) %
(1)
In the current year, amortization of step-up on film and television costs was $634 million and amortization of
intangible assets was $1,699 million. In the prior year, amortization of step-up on film and television costs was $646
million and amortization of intangible assets was $1,749 million.
(2)
The current year includes impairments of assets related to our Russian businesses. The prior year includes impairments
and severance costs related to the closure of an animation studio and severance costs and contract termination charges
in connection with the integration of TFCF.

Disney Parks, Experiences and Products

Operating results for DPEP are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Revenues
Theme park admissions $ 8,602 $ 3,848 >100 %
Parks & Experiences merchandise, food and beverage 6,579 3,299 99 %
Resorts and vacations 6,410 2,701 >100 %
Merchandise licensing and retail 5,229 5,241 — %
Parks licensing and other 1,885 1,463 29 %
Total revenues 28,705 16,552 73 %
Operating expenses (14,936) (10,799) (38) %
Selling, general, administrative and other (3,403) (2,886) (18) %
Depreciation and amortization (2,451) (2,377) (3) %
Equity in the loss of investees (10) (19) 47 %
Operating Income $ 7,905 $ 471 >100 %

43
COVID-19
Revenues at DPEP benefited from fewer closures and operating capacity restrictions in fiscal 2022 compared to fiscal
2021 as a result of COVID-19. The following table summarizes the approximate number of weeks of operations in the current
and prior year:
Weeks of Operation
2022 2021
Walt Disney World Resort 52 52
Disneyland Resort 52 22
Disneyland Paris 52 19
Hong Kong Disneyland Resort 37 40
Shanghai Disney Resort 37 52

Revenues
The increase in theme park admissions revenue was due to attendance growth and higher average per capita ticket
revenue. Higher attendance reflected increases at Disneyland Resort, Walt Disney World Resort and, to a lesser extent,
Disneyland Paris, partially offset by a decrease at Shanghai Disney Resort. Growth in average per capita ticket revenue was due
to the introduction of Genie+ and Lightning Lane at our domestic parks in the first quarter of the current fiscal year and higher
average ticket prices at Walt Disney World Resort and Disneyland Paris, partially offset by lower average ticket prices at
Disneyland Resort and Shanghai Disney Resort.
Parks & Experiences merchandise, food and beverage revenue growth was due to increases of 82% from higher volumes
and 9% from higher average guest spending.
Growth in resorts and vacations revenue was primarily due to increases of 51% from higher occupied hotel room nights,
32% from an increase in passenger cruise days and 17% from higher average daily hotel room rates.
Merchandise licensing and retail revenue was comparable to the prior year, as a decrease of 7% from retail was offset by
an increase of 7% from merchandise licensing. The decrease in retail revenues was due to the closure of a substantial number of
Disney-branded retail stores in North America and Europe in the second half of fiscal 2021. The revenue growth at merchandise
licensing was primarily due to higher sales of merchandise based on Mickey and Friends, Star Wars, Encanto, Spider-Man and
Disney Princesses, partially offset by a decrease in revenues from merchandise based on Frozen.
The increase in parks licensing and other revenue was primarily due to higher sponsorship revenues and an increase in
royalties from Tokyo Disney Resort.
The following table presents supplemental park and hotel statistics:
Domestic International(1) Total
2022 2021 2022 2021 2022 2021
Parks
Increase (decrease)
Attendance(2) nm (17)% 54 % (4)% 87 % (14)%
Per Capita Guest
Spending(3) 13 % 17 % 21 % (3)% 18 % 11 %
Hotels
Occupancy(4) 82 % 42 % 56 % 21 % 76 % 37 %
Available Room Nights (in
thousands)(5) 10,073 10,451 3,179 3,179 13,252 13,630
Increase (decrease)
Per Room Guest
Spending(6) 19 % 1% —% 22 % 16 % 4%
(1)
Per capita guest spending growth rate and per room guest spending growth rate exclude the impact of changes in
foreign currency exchange rates.
(2)
Attendance is used to analyze volume trends at our theme parks and is based on the number of unique daily entries, i.e.
a person visiting multiple theme parks in a single day is counted only once. Our attendance count includes
complimentary entries but excludes entries by children under the age of three.

44
 (3)
Per capita guest spending is used to analyze guest spending trends and is defined as total revenue from ticket sales and
sales of food, beverage and merchandise in our theme parks, divided by total theme park attendance.
(4)
Occupancy is used to analyze the usage of available capacity at hotels and is defined as the number of room nights
occupied by guests as a percentage of available hotel room nights.
(5)
Available hotel room nights are defined as the total number of room nights that are available at our hotels and at DVC
properties located at our theme parks and resorts that are not utilized by DVC members. Available hotel room nights
include rooms temporarily taken out of service.
(6)
Per room guest spending is used to analyze guest spending at our hotels and is defined as total revenue from room
rentals and sales of food, beverage and merchandise at our hotels, divided by total occupied hotel room nights.
Costs and Expenses
Operating expenses are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Operating labor $ (6,577) $ (4,711) (40) %
Infrastructure costs (2,766) (2,308) (20) %
Cost of goods sold and distribution costs (2,938) (2,086) (41) %
Other operating expenses (2,655) (1,694) (57) %
$ (14,936) $ (10,799) (38) %

The increases in operating labor, cost of goods sold and distribution costs and other operating expenses were due to higher
volumes, while the increase in infrastructure costs was due to higher volumes and increased technology spending.
Selling, general, administrative and other costs increased $517 million from $2,886 million to $3,403 million due to
higher marketing spend and inflation.
Depreciation and amortization increased $74 million from $2,377 million to $2,451 million, primarily due to new
attractions at our domestic parks and resorts.

Segment Operating Income

Segment operating income increased $7,434 million, to $7,905 million due to growth at our domestic parks and
experiences and, to a lesser extent, at our international parks and resorts and consumer products business.
The following table presents supplemental revenue and operating income detail for the Parks, Experiences and Products
segment:
% Change
(in millions) 2022 2021 Better (Worse)
Supplemental revenue detail
Parks & Experiences
Domestic $ 20,131 $ 9,353 >100 %
International 3,297 1,859 77 %
Consumer Products 5,277 5,340 (1) %
$ 28,705 $ 16,552 73 %
Supplemental operating income detail
Parks & Experiences
Domestic $ 5,332 $ (1,139) nm
International (237) (1,074) 78 %
Consumer Products 2,810 2,684 5 %
$ 7,905 $ 471 >100 %

45
Items Excluded from Segment Operating Income Related to Parks, Experiences and Products
The following table presents supplemental information for items related to DPEP that are excluded from segment
operating income:
% Change
(in millions) 2022 2021 Better (Worse)
Restructuring and impairment charges(1) $ — $ (327) 100 %
Amortization of TFCF intangible assets (8) (8) — %
(1)
The prior year includes asset impairments and severance costs related to the closure of a substantial number of our
Disney-branded retail stores in North America and Europe and severance costs related to other workforce reductions.

CORPORATE AND UNALLOCATED SHARED EXPENSES

Corporate and unallocated shared expenses are as follows:
% Change
(in millions) 2022 2021 Better (Worse)
Corporate and unallocated shared expenses $ (1,159) $ (928) (25) %

The increase in corporate and unallocated shared expenses was driven by higher compensation and human resource-
related costs.

RESTRUCTURING ACTIVITIES
See Note 18 to the Consolidated Financial Statements for information regarding the Company’s restructuring activities.

LIQUIDITY AND CAPITAL RESOURCES

The change in cash, cash equivalents and restricted cash is as follows:
(in millions) 2022 2021
Cash provided by operations - continuing operations $ 6,002 $ 5,566
Cash used in investing activities - continuing operations (5,008) (3,171)
Cash used in financing activities - continuing operations (4,729) (4,385)
Cash (used in) provided by discontinued operations (4) 9
Impact of exchange rates on cash, cash equivalents and restricted cash (603) 30
Change in cash, cash equivalents and restricted cash $ (4,342) $ (1,951)

Operating Activities
Continuing operations
Cash provided by operating activities of $6.0 billion for fiscal 2022 increased 8% or $436 million compared to $5.6
billion in fiscal 2021 due to higher operating cash flow at DPEP and, to a lesser extent, lower income tax payments and pension
contributions, partially offset by lower operating cash flow at DMED and, to a lesser extent, a partial payment for the Content
License Early Termination. The increase in operating cash flow at DPEP was due to higher operating cash receipts driven by
higher revenue, partially offset by an increase in operating cash disbursements due to higher operating expenses. The decrease
in operating cash flow at DMED was due to higher operating cash disbursements and higher spending on film and television
productions, partially offset by higher operating cash receipts. Higher operating cash disbursements were driven by increased
operating expenses while higher operating cash receipts were due to revenue growth.

46
 Depreciation expense is as follows:
(in millions) 2022 2021
Disney Media and Entertainment Distribution $ 650 $ 613
Disney Parks, Experiences and Products
Domestic 1,680 1,551
International 662 718
Total Disney Parks, Experiences and Products 2,342 2,269
Corporate 191 186
Total depreciation expense $ 3,183 $ 3,068

Amortization of intangible assets is as follows:

(in millions) 2022 2021
Disney Media and Entertainment Distribution $ 164 $ 178
Disney Parks, Experiences and Products 109 108
TFCF and Hulu 1,707 1,757
Total amortization of intangible assets $ 1,980 $ 2,043

Produced and licensed content costs

DMED incurs costs to produce and license film, episodic television and other content. Production costs include spend on
content internally produced at our studios such as live-action and animated films, episodic series, specials, shorts and theatrical
stage plays. Production costs also include original content commissioned from third-party studios. Programming costs include
content rights licensed from third parties for use on the Company’s Linear Networks and DTC streaming services.
Programming assets are generally recorded when the programming becomes available to us with a corresponding increase in
programming liabilities.
The Company’s production and programming activity for fiscal 2022 and 2021 are as follows:
(in millions) 2022 2021
Beginning balances:
Production and programming assets $ 31,732 $ 27,193
Programming liabilities (4,113) (4,099)
27,619 23,094
Spending:
Licensed programming and rights 13,316 12,412
Produced content 16,611 12,848
29,927 25,260
Amortization:
Licensed programming and rights (13,432) (12,784)
Produced content (10,224) (8,175)
(23,656) (20,959)
Change in production and programming costs 6,271 4,301
Other non-cash activity (163) 224
Ending balances:
Production and programming assets 37,667 31,732
Programming liabilities (3,940) (4,113)
$ 33,727 $ 27,619

The Company currently expects its fiscal 2023 spend on produced and licensed content, including sports rights, to be in
the low $30 billion range. See Note 14 to the Consolidated Financial Statements for information regarding the Company’s
contractual commitments to acquire sports and broadcast programming.

47
Commitments and guarantees
The Company has various commitments and guarantees, such as long-term leases, purchase commitments and other
executory contracts, that are disclosed in the footnotes to the financial statements. See Notes 14 and 15 to the Consolidated
Financial Statements for further information regarding these commitments.
Legal and Tax Matters
As disclosed in Notes 9 and 14 to the Consolidated Financial Statements, the Company has exposure for certain tax and
legal matters.

Investing Activities
Continuing operations
Investing activities consist principally of investments in parks, resorts and other property and acquisition and divestiture
activity. The Company’s investments in parks, resorts and other property for fiscal 2022 and 2021 are as follows:
(in millions) 2022 2021
Disney Media and Entertainment Distribution $ 810 $ 862
Disney Parks, Experiences and Products
Domestic 2,680 1,597
International 767 675
Total Disney Parks, Experiences and Products 3,447 2,272
Corporate 686 444
$ 4,943 $ 3,578

Capital expenditures at DMED primarily reflect investments in technology and in facilities and equipment for expanding
and upgrading broadcast centers, production facilities and television station facilities.
Capital expenditures at DPEP are principally for theme park and resort expansion, new attractions, cruise ships, capital
improvements and systems infrastructure. The increase in capital expenditures at our domestic parks and resorts in fiscal 2022
compared to fiscal 2021 was due to cruise ship fleet expansion.
Capital expenditures at Corporate primarily reflect investments in facilities, information technology infrastructure and
equipment. The increase in fiscal 2022 compared to fiscal 2021 was due to higher spending on facilities.
The Company currently expects its fiscal 2023 capital expenditures will be up to approximately $6.7 billion compared to
fiscal 2022 capital expenditures of $4.9 billion. The increase in capital expenditures is due to higher spending across the
enterprise.
Other Investing Activities
Cash provided by other investing activities of $407 million in fiscal 2021 reflects proceeds from the sales of investments.

Financing Activities
Continuing operations
Cash used in financing activities was $4.7 billion in fiscal 2022 compared to $4.4 billion in fiscal 2021. Cash used in
financing activities in fiscal 2022 was due to a reduction in borrowings. The increase in cash used in financing activities in
fiscal 2022 compared to fiscal 2021 reflected a higher reduction in net borrowings ($4.0 billion in fiscal 2022 compared to $3.7
billion in fiscal 2021) and lower proceeds from the exercise of stock options ($0.1 billion in fiscal 2022 compared to $0.4
billion in fiscal 2021). In addition, cash used in financing activities in fiscal 2021 included a $0.4 billion purchase of a
redeemable noncontrolling interest.

48
Borrowings activities and other
During the year ended October 1, 2022, the Company’s borrowing activity was as follows:
October 2, Other October 1,
(in millions) 2021 Borrowings Payments Activity 2022
Commercial paper with original maturities less than
three months(1) $ — $ 50 $ — $ — $ 50
Commercial paper with original maturities greater than
three months 1,992 2,417 (2,801) 4 1,612
U.S. dollar denominated notes(2) 49,090 — (3,857) (142) 45,091
Asia Theme Parks borrowings(3) 1,331 333 (159) (80) 1,425
Foreign currency denominated debt and other(4) 1,993 — — (1,802) 191
$ 54,406 $ 2,800 $ (6,817) $ (2,020) $ 48,369
(1)
Borrowings and reductions of borrowings are reported net.
(2)
The other activity is primarily due to the amortization of purchase accounting adjustments and debt issuance fees.
(3)
See Note 6 to the Consolidated Financial Statements for information regarding commitments to fund the Asia Theme
Parks.
(4)
The other activity is due to market value adjustments for debt with qualifying hedges.
See Note 8 to the Consolidated Financial Statements for information regarding the Company’s bank facilities and debt
maturities. The Company may use operating cash flows, commercial paper borrowings up to the amount of its unused $12.25
billion bank facilities and incremental term debt issuances to retire or refinance other borrowings before or as they come due.
See Note 2 to the Consolidated Financial Statements for a summary of the Company’s put/call agreement with NBCU.
The Company did not declare or pay a dividend or repurchase any of its shares in fiscal 2022 or 2021.
The Company’s operating cash flow and access to the capital markets can be impacted by factors outside of its control,
including COVID-19, which had an adverse impact on the Company’s operating cash flows in fiscal 2021 and, to a lesser
extent, fiscal 2022. We believe that the Company’s financial condition is strong and that its cash balances, other liquid assets,
operating cash flows, access to debt and equity capital markets and borrowing capacity under current bank facilities, taken
together, provide adequate resources to fund ongoing operating requirements and upcoming debt maturities as well as future
capital expenditures related to the expansion of existing businesses and development of new projects. In addition, the Company
could undertake other measures to ensure sufficient liquidity, such as continuing to not declare dividends (the Company did not
pay a dividend with respect to fiscal 2021 operations and has not declared or paid a dividend with respect to fiscal 2022
operations); raising financing; suspending or reducing capital spending; reducing film and television content investments; or
implementing furloughs or reductions in force.
The Company’s borrowing costs can also be impacted by short- and long-term debt ratings assigned by nationally
recognized rating agencies, which are based, in significant part, on the Company’s performance as measured by certain credit
metrics such as leverage and interest coverage ratios. As of October 1, 2022, Moody’s Investors Service’s long- and short-term
debt ratings for the Company were A2 and P-1 (Stable), respectively, Standard and Poor’s long- and short-term debt ratings for
the Company were BBB+ and A-2 (Positive), respectively, and Fitch’s long- and short-term debt ratings for the Company were
A- and F2 (Stable), respectively. The Company’s bank facilities contain only one financial covenant, relating to interest
coverage of three times earnings before interest, taxes, depreciation and amortization, including both intangible amortization
and amortization of our film and television production and programming costs. On October 1, 2022, the Company met this
covenant by a significant margin. The Company’s bank facilities also specifically exclude certain entities, including the Asia
Theme Parks, from any representations, covenants or events of default.

SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

On March 20, 2019, as part of the acquisition of TFCF, The Walt Disney Company (“TWDC”) became the ultimate
parent of TWDC Enterprises 18 Corp. (formerly known as The Walt Disney Company) (“Legacy Disney”). Legacy Disney and
TWDC are collectively referred to as “Obligor Group”, and individually, as a “Guarantor”. Concurrent with the close of the
TFCF acquisition, $16.8 billion of TFCF’s assumed public debt (which then constituted 96% of such debt) was exchanged for
senior notes of TWDC (the “exchange notes”) issued pursuant to an exemption from registration under the Securities Act of
1933, as amended (the “Securities Act”), pursuant to an Indenture, dated as of March 20, 2019, between TWDC, Legacy
Disney, as guarantor, and Citibank, N.A., as trustee (the “TWDC Indenture”) and guaranteed by Legacy Disney. On November
26, 2019, $14.0 billion of the outstanding exchange notes were exchanged for new senior notes of TWDC registered under the
Securities Act, issued pursuant to the TWDC Indenture and guaranteed by Legacy Disney. In addition, contemporaneously with

49
the closing of the March 20, 2019 exchange offer, TWDC entered into a guarantee of the registered debt securities issued by
Legacy Disney under the Indenture dated as of September 24, 2001 between Legacy Disney and Wells Fargo Bank, National
Association, as trustee (the “2001 Trustee”) (as amended by the first supplemental indenture among Legacy Disney, as issuer,
TWDC, as guarantor, and the 2001 Trustee, as trustee).
Other subsidiaries of the Company do not guarantee the registered debt securities of either TWDC or Legacy Disney
(such subsidiaries are referred to as the “non-Guarantors”). The par value and carrying value of total outstanding and
guaranteed registered debt securities of the Obligor Group at October 1, 2022 was as follows:
TWDC Legacy Disney
Carrying Carrying
(in millions) Par Value Value Par Value Value
Registered debt with unconditional guarantee $ 35,343 $ 35,736 $ 9,105 $ 8,851

The guarantees by TWDC and Legacy Disney are full and unconditional and cover all payment obligations arising under
the guaranteed registered debt securities. The guarantees may be released and discharged upon (i) as a general matter, the
indebtedness for borrowed money of the consolidated subsidiaries of TWDC in aggregate constituting no more than 10% of all
consolidated indebtedness for borrowed money of TWDC and its subsidiaries (subject to certain exclusions), (ii) upon the sale,
transfer or disposition of all or substantially all of the equity interests or all or substantially all, or substantially as an entirety,
the assets of Legacy Disney to a third party, and (iii) other customary events constituting a discharge of a guarantor’s
obligations. In addition, in the case of Legacy Disney’s guarantee of registered debt securities issued by TWDC, Legacy Disney
may be released and discharged from its guarantee at any time Legacy Disney is not a borrower, issuer or guarantor under
certain material bank facilities or any debt securities.
Operations are conducted almost entirely through the Company’s subsidiaries. Accordingly, the Obligor Group’s cash
flow and ability to service its debt, including the public debt, are dependent upon the earnings of the Company’s subsidiaries
and the distribution of those earnings to the Obligor Group, whether by dividends, loans or otherwise. Holders of the guaranteed
registered debt securities have a direct claim only against the Obligor Group.
Set forth below are summarized financial information for the Obligor Group on a combined basis after elimination of (i)
intercompany transactions and balances between TWDC and Legacy Disney and (ii) equity in the earnings from and
investments in any subsidiary that is a non-Guarantor. This summarized financial information has been prepared and presented
pursuant to the Securities and Exchange Commission Regulation S-X Rule 13-01, “Financial Disclosures about Guarantors and
Issuers of Guaranteed Securities” and is not intended to present the financial position or results of operations of the Obligor
Group in accordance with U.S. GAAP.
Results of operations (in millions) 2022
Revenues $ —
Costs and expenses —
Net income (loss) from continuing operations (742)
Net income (loss) (742)
Net income (loss) attributable to TWDC shareholders (742)

Balance Sheet (in millions) October 1, 2022 October 2, 2021

Current assets $ 5,665 $ 9,506
Noncurrent assets 1,948 1,689
Current liabilities 3,741 6,878
Noncurrent liabilities (excluding intercompany to non-Guarantors) 46,218 51,439
Intercompany payables to non-Guarantors 148,958 147,629

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

We believe that the application of the following accounting policies, which are important to our financial position and
results of operations, require significant judgments and estimates on the part of management. For a summary of our significant
accounting policies, including the accounting policies discussed below, see Note 2 to the Consolidated Financial Statements.
Produced and Acquired/Licensed Content Costs
We amortize and test for impairment capitalized film and television production costs based on whether the content is
predominantly monetized individually or as a group. See Note 2 to the Consolidated Financial Statements for further
discussion.

50
 Production costs that are classified as individual are amortized based upon the ratio of the current period’s revenues to the
estimated remaining total revenues (Ultimate Revenues).
With respect to produced films intended for theatrical release, the most sensitive factor affecting our estimate of Ultimate
Revenues is theatrical performance. Revenues derived from other markets subsequent to the theatrical release are generally
highly correlated with theatrical performance. Theatrical performance varies primarily based upon the public interest and
demand for a particular film, the popularity of competing films at the time of release and the level of marketing effort. Upon a
film’s release and determination of the theatrical performance, the Company’s estimates of revenues from succeeding windows
and markets, which may include imputed license fees for content that is used on our DTC streaming services, are revised based
on historical relationships and an analysis of current market trends.
With respect to capitalized television production costs that are classified as individual, the most sensitive factors affecting
estimates of Ultimate Revenues are program ratings of the content on our licensees’ platforms. Program ratings, which are an
indication of market acceptance, directly affect the program’s ability to generate advertising and subscriber revenues and are
correlated with the license fees we can charge for the content in subsequent windows and for subsequent seasons.
Ultimate Revenues are reassessed each reporting period and the impact of any changes on amortization of production cost
is accounted for as if the change occurred at the beginning of the current fiscal year. If our estimate of Ultimate Revenues
decreases, amortization of costs may be accelerated or result in an impairment. Conversely, if our estimate of Ultimate
Revenues increases, cost amortization may be slowed.
Produced content costs that are part of a group and acquired/licensed content costs are amortized based on projected usage
typically resulting in an accelerated or straight-line amortization pattern. The determination of projected usage requires
judgment and is reviewed on a regular basis for changes. Adjustments to projected usage are applied prospectively in the period
of the change. For example, beginning in the fourth quarter of fiscal 2022, for certain content, we are accelerating the rate of
amortization in early periods, slowing the rate in later periods and have adjusted the useful life based on historical and projected
usage patterns. The most sensitive factors affecting projected usage are historical and estimated viewing patterns. If projected
usage changes we may need to accelerate or slow the recognition of amortization expense.
For content that is predominantly monetized as a group, the aggregate unamortized costs of the group are compared to the
present value of the discounted cash flows using the lowest level for which identifiable cash flows are independent of other
produced and licensed content. If the unamortized costs exceed the present value of discounted cash flows, an impairment
charge is recorded for the excess and allocated to individual titles based on the relative carrying value of each title in the group.
If there are no plans to continue to use an individual film or television program that is part of a group, the unamortized cost of
the individual title is written-off immediately. Licensed content is included as part of the group within which it is monetized for
purposes of assessing recoverability.
The amortization of multi-year sports rights is based on projections of revenues for each season relative to projections of
total revenues over the contract period (estimated relative value). Projected revenues include advertising revenue and an
allocation of affiliate revenue. If the annual contractual payments related to each season approximate each season’s estimated
relative value, we expense the related contractual payments during the applicable season. If estimated relative values by year
were to change significantly, amortization of our sports rights costs may be accelerated or slowed.
Revenue Recognition
The Company has revenue recognition policies for its various operating segments that are appropriate to the
circumstances of each business. Refer to Note 2 to the Consolidated Financial Statements for our revenue recognition policies.
Pension and Postretirement Medical Plan Actuarial Assumptions
The Company’s pension and postretirement medical benefit obligations and related costs are calculated using a number of
actuarial assumptions. Two critical assumptions, the discount rate and the expected return on plan assets, are important
elements of expense and/or liability measurement, which we evaluate annually. Other assumptions include the healthcare cost
trend rate and employee demographic factors such as retirement patterns, mortality, turnover and rate of compensation increase.
The discount rate enables us to state expected future cash payments for benefits as a present value on the measurement
date. A lower discount rate increases the present value of benefit obligations and increases pension and postretirement medical
expense. The guideline for setting this rate is a high-quality long-term corporate bond rate. We increased our discount rate to
5.44% at the end of fiscal 2022 from 2.88% at the end of fiscal 2021 to reflect market interest rate conditions at our fiscal 2022
year-end measurement date. The Company’s discount rate was determined by considering yield curves constructed of a large
population of high-quality corporate bonds and reflects the matching of the plans’ liability cash flows to the yield curves. A one
percentage point decrease in the assumed discount rate would increase total benefit expense for fiscal 2023 by approximately
$242 million and would increase the projected benefit obligation at October 1, 2022 by approximately $2.3 billion. A one
percentage point increase in the assumed discount rate would decrease total benefit expense and the projected benefit obligation
by approximately $59 million and $2.0 billion, respectively.

51
 To determine the expected long-term rate of return on the plan assets, we consider the current and expected asset
allocation, as well as historical and expected returns on each plan asset class. Our expected return on plan assets is 7.00%. A
lower expected rate of return on plan assets will increase pension and postretirement medical expense. A one percentage point
change in the long-term asset return assumption would impact fiscal 2023 annual expense by approximately $172 million.
Goodwill, Other Intangible Assets, Long-Lived Assets and Investments
The Company is required to test goodwill and other indefinite-lived intangible assets for impairment on an annual basis
and if current events or circumstances require, on an interim basis. The Company performs its annual test of goodwill and
indefinite-lived intangible assets for impairment in its fiscal fourth quarter.
Goodwill is allocated to various reporting units, which are an operating segment or one level below the operating
segment. To test goodwill for impairment, the Company first performs a qualitative assessment to determine if it is more likely
than not that the carrying amount of a reporting unit exceeds its fair value. If it is, a quantitative assessment is required.
Alternatively, the Company may bypass the qualitative assessment and perform a quantitative impairment test.
The qualitative assessment requires the consideration of factors such as recent market transactions, macroeconomic
conditions, and changes in projected future cash flows of the reporting unit.
The quantitative assessment compares the fair value of each goodwill reporting unit to its carrying amount, and to the
extent the carrying amount exceeds the fair value, an impairment of goodwill is recognized for the excess up to the amount of
goodwill allocated to the reporting unit.
In fiscal 2022, the Company bypassed the qualitative test and performed a quantitative assessment of goodwill for
impairment.
The impairment test for goodwill requires judgment related to the identification of reporting units, the assignment of
assets and liabilities to reporting units including goodwill, and the determination of fair value of the reporting units. To
determine the fair value of our reporting units, we apply what we believe to be the most appropriate valuation methodology for
each of our reporting units. We generally use a present value technique (discounted cash flows) corroborated by market
multiples when available and as appropriate. The discounted cash flow analyses are sensitive to our estimates of future revenue
growth and margins for these businesses as well as the discount rates used to calculate the present value of future cash flows. In
times of adverse economic conditions in the global economy, the Company’s long-term cash flow projections are subject to a
greater degree of uncertainty than usual. We believe our estimates are consistent with how a marketplace participant would
value our reporting units. If we had established different reporting units or utilized different valuation methodologies or
assumptions, the impairment test results could differ, and we could be required to record impairment charges.
To test its other indefinite-lived intangible assets for impairment, the Company first performs a qualitative assessment to
determine if it is more likely than not that the carrying amount of each of its indefinite-lived intangible assets exceeds its fair
value. If it is, a quantitative assessment is required. Alternatively, the Company may bypass the qualitative assessment and
perform a quantitative impairment test.
The qualitative assessment requires the consideration of factors such as recent market transactions, macroeconomic
conditions, and changes in projected future cash flows.
The quantitative assessment compares the fair value of an indefinite-lived intangible asset to its carrying amount. If the
carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized for the excess.
Fair values of indefinite-lived intangible assets are determined based on discounted cash flows or appraised values, as
appropriate.
The Company tests long-lived assets, including amortizable intangible assets, for impairment whenever events or changes
in circumstances (triggering events) indicate that the carrying amount may not be recoverable. Once a triggering event has
occurred, the impairment test employed is based on whether the Company’s intent is to hold the asset for continued use or to
hold the asset for sale. The impairment test for assets held for use requires a comparison of the estimated undiscounted future
cash flows expected to be generated over the useful life of the significant assets of an asset group to the carrying amount of the
asset group. An asset group is generally established by identifying the lowest level of cash flows generated by a group of assets
that are largely independent of the cash flows of other assets and could include assets used across multiple businesses. If the
carrying amount of an asset group exceeds the estimated undiscounted future cash flows, an impairment would be measured as
the difference between the fair value of the asset group and the carrying amount of the asset group. For assets held for sale, to
the extent the carrying amount is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the
difference. Determining whether a long-lived asset is impaired requires various estimates and assumptions, including whether a
triggering event has occurred, the identification of asset groups, estimates of future cash flows and the discount rate used to
determine fair values.

52
 The Company has investments in equity securities. For equity securities that do not have a readily determinable fair value,
we consider forecasted financial performance of the investee companies, as well as volatility inherent in the external markets
for these investments. If these forecasts are not met, impairment charges may be recorded.
The Company recorded non-cash impairment charges of $0.2 billion and $0.3 billion in fiscal 2022 and 2021,
respectively. The fiscal 2022 charges primarily related to our businesses in Russia. The fiscal 2021 charges primarily related to
the closure of an animation studio and a substantial number of our Disney-branded retail stores in North America and Europe.
Allowance for Credit Losses
We evaluate our allowance for credit losses and estimate collectability of accounts receivable based on historical bad debt
experience, our assessment of the financial condition of individual companies with which we do business, current market
conditions, and reasonable and supportable forecasts of future economic conditions. In times of economic turmoil, including
COVID-19, our estimates and judgments with respect to the collectability of our receivables are subject to greater uncertainty
than in more stable periods. If our estimate of uncollectible accounts is too low, costs and expenses may increase in future
periods, and if it is too high, costs and expenses may decrease in future periods. See Note 2 to the Consolidated Financial
Statements for additional discussion.
Contingencies and Litigation
We are currently involved in certain legal proceedings and, as required, have accrued estimates of the probable and
estimable losses for the resolution of these proceedings. These estimates are based upon an analysis of potential results,
assuming a combination of litigation and settlement strategies and have been developed in consultation with outside counsel as
appropriate. From time to time, we are also involved in other contingent matters for which we accrue estimates for a probable
and estimable loss. It is possible, however, that future results of operations for any particular quarterly or annual period could
be materially affected by changes in our assumptions or the effectiveness of our strategies related to legal proceedings or our
assumptions regarding other contingent matters. See Note 14 to the Consolidated Financial Statements for more detailed
information on litigation exposure.
Income Tax
As a matter of course, the Company is regularly audited by federal, state and foreign tax authorities. From time to time,
these audits result in proposed assessments. Our determinations regarding the recognition of income tax benefits are made in
consultation with outside tax and legal counsel, where appropriate, and are based upon the technical merits of our tax positions
in consideration of applicable tax statutes and related interpretations and precedents and upon the expected outcome of
proceedings (or negotiations) with taxing and legal authorities. The tax benefits ultimately realized by the Company may differ
from those recognized in our future financial statements based on a number of factors, including the Company’s decision to
settle rather than litigate a matter, relevant legal precedent related to similar matters and the Company’s success in supporting
its filing positions with taxing authorities.

New Accounting Pronouncements

See Note 19 to the Consolidated Financial Statements for information regarding new accounting pronouncements.

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to the impact of interest rate changes, foreign currency fluctuations, commodity fluctuations and
changes in the market values of its investments.

Policies and Procedures

In the normal course of business, we employ established policies and procedures to manage the Company’s exposure to
changes in interest rates, foreign currencies and commodities using a variety of financial instruments.
Our objectives in managing exposure to interest rate changes are to limit the impact of interest rate volatility on earnings
and cash flows and to lower overall borrowing costs. To achieve these objectives, we primarily use interest rate swaps to
manage net exposure to interest rate changes related to the Company’s portfolio of borrowings. By policy, the Company targets
fixed-rate debt as a percentage of its net debt between minimum and maximum percentages.
Our objective in managing exposure to foreign currency fluctuations is to reduce volatility of earnings and cash flow in
order to allow management to focus on core business issues and challenges. Accordingly, the Company enters into various
contracts that change in value as foreign exchange rates change to protect the U.S. dollar equivalent value of its existing foreign
currency assets, liabilities, commitments and forecasted foreign currency revenues and expenses. The Company utilizes option
strategies and forward contracts that provide for the purchase or sale of foreign currencies to hedge probable, but not firmly
committed, transactions. The Company also uses forward and option contracts to hedge foreign currency assets and liabilities.
The principal foreign currencies hedged are the euro, Japanese yen, British pound, Chinese yuan and Canadian dollar. Cross-

53
currency swaps are used to effectively convert foreign currency denominated borrowings to U.S. dollar denominated
borrowings. By policy, the Company maintains hedge coverage between minimum and maximum percentages of its forecasted
foreign exchange exposures generally for periods not to exceed four years. The gains and losses on these contracts are intended
to offset changes in the U.S. dollar equivalent value of the related exposures. The economic or political conditions in certain
countries have reduced and in the future could further reduce our ability to hedge exposure to currency fluctuations in, or
repatriate cash from, those countries.
Our objectives in managing exposure to commodity fluctuations are to use commodity derivatives to reduce volatility of
earnings and cash flows arising from commodity price changes. The amounts hedged using commodity swap contracts are
based on forecasted levels of consumption of certain commodities, such as fuel oil and gasoline.
Our objectives in managing exposures to market-based fluctuations in certain retirement liabilities are to use total return
swap contracts to reduce the volatility of earnings arising from changes in these retirement liabilities. The amounts hedged
using total return swap contracts are based on estimated liability balances.
It is the Company’s policy to enter into foreign currency and interest rate derivative transactions and other financial
instruments only to the extent considered necessary to meet its objectives as stated above. The Company does not enter into
these transactions or any other hedging transactions for speculative purposes.

Value at Risk (VAR)

The Company utilizes a VAR model to estimate the maximum potential one-day loss in the fair value of its interest rate,
foreign exchange, commodities and market sensitive equity financial instruments. The VAR model estimates were made
assuming normal market conditions and a 95% confidence level. Various modeling techniques can be used in a VAR
computation. The Company’s computations are based on the interrelationships between movements in various interest rates,
currencies, commodities and equity prices (a variance/co-variance technique). These interrelationships were determined by
observing interest rate, foreign currency, commodity and equity market changes over the preceding quarter for the calculation
of VAR amounts at each fiscal quarter end. The model includes all of the Company’s debt as well as all interest rate and foreign
exchange derivative contracts, commodities and market sensitive equity investments. Forecasted transactions, firm
commitments, and accounts receivable and payable denominated in foreign currencies, which certain of these instruments are
intended to hedge, were excluded from the model.
The VAR model is a risk analysis tool and does not purport to represent actual losses in fair value that will be incurred by
the Company, nor does it consider the potential effect of favorable changes in market factors.
VAR on a combined basis increased to $395 million at October 1, 2022 from $364 million at October 2, 2021.
The estimated maximum potential one-day loss in fair value, calculated using the VAR model, is as follows (unaudited, in
millions):
Interest Rate Currency Equity Commodity
Sensitive Sensitive Sensitive Sensitive
Financial Financial Financial Financial Combined
Fiscal 2022 Instruments Instruments Instruments Instruments Portfolio
Year end fiscal 2022 VAR $ 376 $ 71 $ 20 $ 4 $ 395
Average VAR 415 62 25 4 426
Highest VAR 455 72 32 7 479
Lowest VAR 376 46 20 2 394
Year end fiscal 2021 VAR 357 44 37 1 364

The VAR for Hong Kong Disneyland Resort and Shanghai Disney Resort is immaterial as of October 1, 2022 and has
been excluded from the above table.

ITEM 8. Financial Statements and Supplementary Data

See Index to Financial Statements and Supplemental Data on page 63.

ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.

ITEM 9A. Controls and Procedures

54
Evaluation of Disclosure Controls and Procedures
We have established disclosure controls and procedures to ensure that the information required to be disclosed by the
Company in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized
and reported within the time periods specified in SEC rules and forms and that such information is accumulated and made
known to the officers who certify the Company’s financial reports and to other members of senior management and the Board
of Directors as appropriate to allow timely decisions regarding required disclosure.
Based on their evaluation as of October 1, 2022, the principal executive officer and principal financial officer of the
Company have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934) are effective.
Management’s Report on Internal Control Over Financial Reporting
Management’s report set forth on page 64 is incorporated herein by reference.
Changes in Internal Controls
There have been no changes in our internal control over financial reporting during the fourth quarter of the fiscal year
ended October 1, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over
financial reporting.

ITEM 9B. Other Information

None.

ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

55
 PART III

ITEM 10. Directors, Executive Officers and Corporate Governance

Information regarding Section 16(a) compliance, the Audit Committee, the Company’s code of ethics, background of the
directors and director nominations appearing under the captions “Delinquent Section 16(a) Reports,” “The Board of Directors,”
“Committees,” “Governing Documents,” “Director Selection Process” and “Election of Directors” in the Company’s Proxy
Statement for the 2023 annual meeting of Shareholders is hereby incorporated by reference.
Information regarding executive officers is included in Part I of this Form 10-K as permitted by General Instruction G(3).

ITEM 11. Executive Compensation

Information appearing under the captions “Director Compensation,” and “Executive Compensation” (other than the
“Compensation Committee Report,” which is deemed furnished herein by reference, and the “Letter from the Compensation
Committee”) in the 2023 Proxy Statement is hereby incorporated by reference.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Information setting forth the security ownership of certain beneficial owners and management appearing under the caption
“Stock Ownership” and information appearing under the caption “Equity Compensation Plans” in the 2023 Proxy Statement is
hereby incorporated by reference.

ITEM 13. Certain Relationships and Related Transactions, and Director Independence
Information regarding certain related transactions appearing under the captions “Certain Relationships and Related Person
Transactions” and information regarding director independence appearing under the caption “Director Independence” in the
2023 Proxy Statement is hereby incorporated by reference.

ITEM 14. Principal Accounting Fees and Services

Information appearing under the captions “Auditor Fees and Services” and “Policy for Approval of Audit and Permitted
Non-Audit Services” in the 2023 Proxy Statement is hereby incorporated by reference.

56
 PART IV
ITEM 15. Exhibits and Financial Statement Schedules
(1) Financial Statements and Schedules
See Index to Financial Statements and Supplemental Data on page 63.
(2) Exhibits
The documents set forth below are filed herewith or incorporated herein by reference to the location indicated.
Exhibit Location
3.1 Restated Certificate of Incorporation of The Walt Exhibit 3.1 to the Current Report on Form 8-K of
Disney Company, effective as of March 19, 2019 the Company filed March 20, 2019
3.2 Certificate of Amendment to the Restated Certificate of Exhibit 3.2 to the Current Report on Form 8-K of
Incorporation of The Walt Disney Company, effective the Company filed March 20, 2019
as of March 20, 2019
3.3 Amended and Restated Bylaws of The Walt Disney Exhibit 3.3 to the Current Report on Form 8-K of
Company, effective as of March 20, 2019 the Company filed March 20, 2019
3.4 Amended and Restated Certificate of Incorporation of Exhibit 3.1 to the Current Report on Form 8-K of
TWDC Enterprises 18 Corp., effective as of March 20, Legacy Disney filed March 20, 2019
2019
3.5 Amended and Restated Bylaws of TWDC Enterprises Exhibit 3.2 to the Current Report on Form 8-K of
18 Corp., effective as of March 20, 2019 Legacy Disney filed March 20, 2019
3.6 Certificate of Elimination of Series B Convertible Exhibit 3.1 to the Current Report on Form 8-K of
Preferred Stock of The Walt Disney Company, as filed Legacy Disney filed November 30, 2018
with the Secretary of State of the State of Delaware on
November 28, 2018
4.1 Senior Debt Securities Indenture, dated as of Exhibit 4.1 to the Current Report on Form 8-K of
September 24, 2001, between TWDC Enterprises 18 Legacy Disney filed September 24, 2001
Corp. and Wells Fargo Bank, N.A., as Trustee
4.2 First Supplemental Indenture, dated as of March 20, Exhibit 4.1 to the Current Report on Form 8-K of
2019, among The Walt Disney Company, TWDC Legacy Disney filed March 20, 2019
Enterprises 18 Corp. and Wells Fargo Bank, N.A., as
Trustee
4.3 Indenture, dated as of March 20, 2019, by and among Exhibit 4.1 to the Current Report on Form 8-K of
The Walt Disney Company, as issuer, and TWDC the Company filed March 20, 2019
Enterprises 18 Corp., as guarantor, and Citibank, N.A.,
as trustee
4.4 Other long-term borrowing instruments are omitted
pursuant to Item 601(b)(4)(iii) of Regulation S-K. The
Company undertakes to furnish copies of such
instruments to the Commission upon request
4.5 Description of Registrant’s Securities Exhibit 4.6 to the Form 10-K of the Company for
the fiscal year ended September 28, 2019
10.1 Employment Agreement dated as of February 24, 2020 Exhibit 10.2 to the Current Report on Form 8-K of
between the Company and Robert Chapek † the Company filed February 25, 2020
10.2 Amendment dated July 15, 2022 to the Employment Exhibit 10.1 to the Form 10-Q of the Company for
Agreement dated February 24, 2020, between the the quarter ended July 2, 2022
Company and Robert Chapek †
10.3 Amended and Restated Employment Agreement, dated Exhibit 10.1 to the Form 10-K of Legacy Disney for
as of October 6, 2011, between the Company and the fiscal year ended October 1, 2011
Robert A. Iger †
10.4 Amendment dated July 1, 2013 to Amended and Exhibit 10.1 to the Current Report on Form 8-K of
Restated Employment Agreement, dated as of October Legacy Disney filed July 1, 2013
6, 2011, between the Company and Robert A. Iger †
10.5 Amendment dated October 2, 2014 to Amended and Exhibit 10.1 to the Current Report on Form 8-K of
Restated Employment Agreement, dated as of October Legacy Disney filed October 3, 2014
6, 2011, between the Company and Robert A. Iger †
10.6 Amendment dated March 22, 2017 to Amended and Exhibit 10.1 to the Current Report on Form 8-K of
Restated Employment Agreement, dated as of October Legacy Disney filed March 23, 2017
6, 2011, between the Company and Robert A. Iger †

57
 Exhibit Location
10.7 Amendment dated December 13, 2017 to Amended Exhibit 10.2 to the Current Report on Form 8-K of
and Restated Employment Agreement, dated as of Legacy Disney filed December 14, 2017
October 6, 2011, between the Company and Robert A.
Iger †
10.8 Amendment to Amended and Restated Employment Exhibit 10.1 to the Current Report on Form 8-K of
Agreement, Dated as of October 6, 2011, as amended, Legacy Disney filed December 3, 2018
between the Company and Robert A. Iger, dated
November 30, 2018 †
10.9 Amendment to Amended and Restated Employment Exhibit 10.1 to the Current Report on Form 8-K of
Agreement, Dated as of October 6, 2011, as amended, Legacy Disney filed March 4, 2019
between the Company and Robert A. Iger, dated March
4, 2019 †
10.10 Amendment to Amended and Restated Employment Exhibit 10.1 to the Current Report on Form 8-K of
Agreement, Dated as of October 6, 2011 and as the Company filed February 25, 2020
previously amended, between the Company and Robert
A. Iger, dated February 24, 2020 †
10.11 Employment Agreement dated as of July 1, 2015 Exhibit 10.1 to the Current Report on Form 8-K of
between the Company and Christine M. McCarthy † Legacy Disney filed June 30, 2015
10.12 Amendment dated August 15, 2017 to the Employment Exhibit 10.4 to the Current Report on Form 8-K of
Agreement dated as of July 1, 2015 between the Legacy Disney filed August 17, 2017
Company and Christine M. McCarthy †
10.13 Amendment dated December 2, 2020 to Amended Exhibit 10.1 to the Current Report on Form 8-K of
Employment Agreement dated as of July 1, 2015 the Company filed December 7, 2020
between the Company and Christine M. McCarthy †
10.14 Amendment dated December 21, 2021 to Amended Exhibit 10.1 to the Current Report on Form 8-K of
Employment Agreement dated as of July 1, 2015 the Company filed December 21, 2021
between the Company and Christine M. McCarthy †
10.15 Assignment of Employment Agreement dated January Exhibit 10.3 to the Form 10-Q of the Company for
19, 2022 between the Company and Christine M. the quarter ended January 1, 2022
McCarthy †
10.16 Employment Agreement, dated as of July 1, 2021 Exhibit 10.1 to the Form 10-Q of the Company for
between the Company and Paul J. Richardson † the quarter ended July 3, 2021

10.17 Employment Agreement, dated as of December 21, Exhibit 10.4 to the Form 10-Q of the Company for
2021 between the Company and Horacio E. the quarter ended January 1, 2022
Gutierrez †
10.18 Assignment of Employment Agreement dated January Exhibit 10.5 to the Form 10-Q of the Company for
31, 2022 between the Company and Horacio E. the quarter ended January 1, 2022
Gutierrez †
10.19 Amendment dated July 21, 2022 to the Employment Exhibit 10.2 to the Form 10-Q of the Company for
Agreement dated December 21, 2021, between Disney the quarter ended July 2, 2022
Corporate Services Co., LLC and Horacio E. Gutierrez
and to the Indemnification Agreement dated December
21, 2021, between the Company and Horacio E.
Gutierrez †
10.20 Employment Agreement, dated as of January 24, 2022 Exhibit 10.6 to the Form 10-Q of the Company for
between the Company and Geoffrey S. Morrell † the quarter ended January 1, 2022
10.21 Amended and Restated General Release, dated June Exhibit 10.5 to the Form 10-Q of the Company for
23, 2022, between the Company and Geoff Morrell † the quarter ended July 2, 2022
10.22 Employment Agreement, dated June 29, 2022, between Exhibit 10.3 to the Form 10-Q of the Company for
the Company and Kristina K. Schake † the quarter ended July 2, 2022
10.23 Consulting Agreement between the Company and M. Filed herewith
Jayne Parker †
10.24 Voluntary Non-Qualified Deferred Compensation Exhibit 10.1 to the Current Report on Form 8-K of
Plan † Legacy Disney filed December 23, 2014
10.25 Description of Directors Compensation Exhibit 10.1 to the Form 10-Q of the Company for
the quarter ended January 1, 2022
10.26 Form of Indemnification Agreement for certain Filed herewith
officers and directors †

58
 Exhibit Location
10.27 Form of Assignment and Assumption of Exhibit 10.1 to the Form 10-Q of the Company for
Indemnification Agreement for certain officers and the quarter ended June 29, 2019
directors †
10.28 1995 Stock Option Plan for Non-Employee Directors Exhibit 20 to the Form S-8 Registration Statement
(No. 33-57811) of DEI, dated Feb. 23, 1995
10.29 Amended and Restated 2002 Executive Performance Annex A to the Proxy Statement for the 2013
Plan † Annual Meeting of Legacy Disney
10.30 Management Incentive Bonus Program † The portions of the tables labeled “Performance-
based Bonus” in the sections of the Proxy Statement
for the 2022 annual meeting titled “Executive
Compensation Program Structure - Objectives and
Methods - Objectives and Key Features” and
“Compensation Process” and the section of the
Proxy Statement titled “Performance Goals”
10.31 Amended and Restated 1997 Non-Employee Directors Annex II to the Proxy Statement for the 2003
Stock and Deferred Compensation Plan annual meeting of Legacy Disney
10.32 Amended and Restated The Walt Disney Company/ Exhibit 10.1 to the Current Report on Form 8-K of
Pixar 2004 Equity Incentive Plan † Legacy Disney filed December 1, 2006
10.33 Amended and Restated 2011 Stock Incentive Plan † Annex B to Proxy Statement of registrant filed
January 17, 2020
10.34 Disney Key Employees Retirement Savings Plan † Exhibit 10.1 to the Form 10-Q of Legacy Disney for
the quarter ended July 2, 2011
10.35 Amendments dated April 30, 2015 to the Amended and Exhibit 10.3 to the Form 10-Q of Legacy Disney for
Restated The Walt Disney Productions and Associated the quarter ended March 28, 2015
Companies Key Employees Deferred Compensation
and Retirement Plan, Amended and Restated Benefit
Equalization Plan of ABC, Inc. and Disney Key
Employees Retirement Savings Plan †
10.36 Second Amendment to the Disney Key Employees Exhibit 10.33 to the Form 10-K of the Company for
Retirement Savings Plan † the fiscal year ended October 2, 2021
10.37 Third Amendment to the Disney Key Employees Exhibit 10.9 to the Form 10-Q of the Company for
Retirement Savings Plan † the quarter ended January 1, 2022
10.38 Group Personal Excess Liability Insurance Plan † Exhibit 10.8 to the Form 10-Q of the Company for
the quarter ended January 1, 2022
10.39 Form of Non-Qualified Stock Option Award Exhibit 10.2 to the Form 10-Q of the Company for
Agreement † the quarter ended January 2, 2021
10.40 Form of Non-Qualified Stock Option Award Exhibit 10.6 to the Form 10-Q of the Company for
Agreement † the quarter ended July 2, 2022
10.41 Form of Restricted Stock Unit Award Agreement Exhibit 10.7 to the Form 10-Q of the Company for
(Time-Based Vesting) † the quarter ended July 2, 2022
10.42 Form of Performance-Based Stock Unit Award Exhibit 10.4 to the Form 10-Q of the Company for
Agreement (Section 162(m) Vesting Requirement) † the quarter ended January 2, 2021
10.43 Form of Performance-Based Restricted Stock Unit Exhibit 10.5 to the Form 10-Q of the Company for
Award Agreement (Three-Year Vesting subject to the quarter ended January 2, 2021
Total Shareholder Return/ROIC Tests) †
10.44 Form of Performance-Based Restricted Stock Unit Filed herewith
Award Agreement (Three-Year Vesting subject to
Total Shareholder Return/ROIC Tests) †
10.45 Form of Performance-Based Restricted Stock Unit Exhibit 10.6 to the Form 10-Q of the Company for
Award Agreement (Three-Year Vesting subject to the quarter ended January 2, 2021
Total Shareholder Return/ROIC Tests/Section 162(m)
Vesting Requirements) †
10.46 Form of Restricted Stock Unit Award Agreement Exhibit 10.8 to the Form 10-Q of Legacy Disney for
(Time-Based Vesting) † the quarter ended December 29, 2018
10.47 Form of Performance-Based Stock Unit Award Exhibit 10.9 to the Form 10-Q of Legacy Disney for
Agreement (Section 162(m) Vesting Requirement) † the quarter ended December 29, 2018

59
 Exhibit Location
10.48 Form of Performance-Based Stock Unit Award Exhibit 10.11 to the Form 10-Q of Legacy Disney
Agreement (Three-Year Vesting subject to Total for the quarter ended December 29, 2018
Shareholder Return/EPS Growth Tests/
Section 162(m) Vesting Requirement) †
10.49 Form of Performance-Based Stock Unit Award Exhibit 10.10 to the Form 10-Q of Legacy Disney
Agreement (Three-Year Vesting subject to Total for the quarter ended December 29, 2018
Shareholder Return/EPS Growth Tests) †
10.50 Form of Non-Qualified Stock Option Award Exhibit 10.12 to the Form 10-Q of Legacy Disney
Agreement † for the quarter ended December 29, 2018
10.51 Performance-Based Stock Unit Award (Four-Year Exhibit 10.3 to the Form 10-Q of Legacy Disney for
Vesting subject to Total Shareholder Return Test/ the quarter ended December 30, 2017
Section 162(m) Vesting Requirements) for Robert A.
Iger dated as of December 13, 2017 †
10.52 Performance-Based Stock Unit Award (Four-Year Exhibit 10.2 to the Current Report on Form 8-K of
Vesting subject to Total Shareholder Return Test) as Legacy Disney filed December 3, 2018
Amended and Restated November 30, 2018 by and
between the Company and Robert A. Iger †
10.53 Performance-Based Stock Unit Award (Section 162(m) Exhibit 10.4 to the Form 10-Q of Legacy Disney for
Vesting Requirement) for Robert A. Iger dated as of the quarter ended December 30, 2017
December 13, 2017 †
10.54 Performance-Based Restricted Stock Unit Award Exhibit 10.11 to the Form 10-Q of the Company for
Agreement (Three-Year Vesting subject to Total the quarter ended January 1, 2022
Shareholder Return/ROIC tests) for Robert A. Iger
dated as of December 14, 2021 †
10.55 Non-Qualified Stock Option Award Agreement for Exhibit 10.12 to the Form 10-Q of the Company for
Robert A. Iger dated as of December 14, 2021 † the quarter ended January 1, 2022
10.56 Form of Performance-Based Restricted Stock Unit Exhibit 10.1 to the Form 10-Q of the Company for
Award Agreement (Three-Year Vesting subject to the quarter ended December 28, 2019
Total Shareholder Return/ROIC Tests) †
10.57 Form of Performance-Based Restricted Stock Unit Filed herewith
Award Agreement (Three-Year Vesting subject to
Total Shareholder Return/ROIC Tests) †
10.58 Form of Stock Option Awards Agreement † Filed herewith
10.59 Form of Stock Option Awards Agreement † Filed herewith
10.60 Form of Stock Option Awards Agreement † Filed herewith
10.61 Form of Stock Option Awards Agreement † Filed herewith
10.62 Form of Stock Option Awards Agreement † Filed herewith
10.63 Twenty-First Century Fox, Inc. 2013 Long-Term Exhibit 10.1 to the Form 8-K of TFCF filed October
Incentive Plan † 18, 2013
10.64 Five-Year Credit Agreement dated as of March 6, 2020 Exhibit 10.2 to the Current Report on Form 8-K of
the Company filed March 11, 2020
10.65 First Amendment dated as of March 4, 2022 to the Exhibit 10.3 to the Current Report on Form 8-K of
Five-Year Credit Agreement dated as of March 6, 2020 the Company filed March 9, 2022
10.66 Five-Year Credit Agreement dated as of March 4, 2022 Exhibit 10.2 to the Current Report on Form 8-K of
the Company filed March 9, 2022
10.67 364-Day Credit Agreement dated as of March 4, 2022 Exhibit 10.1 to the Current Report on Form 8-K of
the Company filed March 9, 2022
10.68 Support Agreement, dated as of September 30, 2022, Exhibit 10.1 to the Current Report on Form 8-K of
by and among Third Point LLC and certain of its the Company filed September 30, 2022
affiliates and The Walt Disney Company
21 Subsidiaries of the Company Filed herewith
22 List of Guarantor Subsidiaries Filed herewith
23 Consent of PricewaterhouseCoopers LLP Filed herewith
31(a) Rule 13a-14(a) Certification of Chief Executive Filed herewith
Officer of the Company in accordance with Section
302 of the Sarbanes-Oxley Act of 2002

60
 Exhibit Location
31(b) Rule 13a-14(a) Certification of Chief Financial Officer Filed herewith
of the Company in accordance with Section 302 of the
Sarbanes-Oxley Act of 2002
32(a) Section 1350 Certification of Chief Executive Officer Furnished herewith
of the Company in accordance with Section 906 of the
Sarbanes-Oxley Act of 2002**
32(b) Section 1350 Certification of Chief Financial Officer Furnished herewith
of the Company in accordance with Section 906 of the
Sarbanes-Oxley Act of 2002**
101 The following materials from the Company’s Annual Filed herewith
Report on Form 10-K for the year ended October 1,
2022 formatted in Inline Extensible Business
Reporting Language (iXBRL): (i) the Consolidated
Statements of Operations, (ii) the Consolidated
Statements of Comprehensive Income, (iii) the
Consolidated Balance Sheets, (iv) the Consolidated
Statements of Cash Flows, (v) the Consolidated
Statements of Equity and (vi) related notes
104 Cover Page Interactive Data File (embedded within the Filed herewith
Inline XBRL document)

* Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted
schedule or exhibit will be furnished supplementally to the SEC upon request.
** A signed original of this written statement required by Section 906 has been provided to the Company and will be
retained by the Company and furnished to the SEC or its staff upon request.
† Management contract or compensatory plan or arrangement.

ITEM 16. Form 10-K Summary

None.

61
 SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
THE WALT DISNEY COMPANY
(Registrant)
Date: November 29, 2022 By: /s/ ROBERT A. IGER
(Robert A. Iger
Chief Executive Officer and Director)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature Title Date

Principal Executive Officer
/s/ ROBERT A. IGER Chief Executive Officer and Director November 29, 2022
(Robert A. Iger)

Principal Financial and Accounting Officers

/s/ CHRISTINE M. MCCARTHY Senior Executive Vice President November 29, 2022
and Chief Financial Officer
(Christine M. McCarthy)

/s/ BRENT A. WOODFORD Executive Vice President-Controllership, November 29, 2022

Financial Planning and Tax
(Brent A. Woodford)

Directors
/s/ SUSAN E. ARNOLD Chairman of the Board and Director November 29, 2022
(Susan E. Arnold)

/s/ MARY T. BARRA Director November 29, 2022

(Mary T. Barra)

/s/ SAFRA A. CATZ Director November 29, 2022

(Safra A. Catz)

/s/ AMY L. CHANG Director November 29, 2022

(Amy L. Chang)
/s/ FRANCIS A. DESOUZA Director November 29, 2022
(Francis A. deSouza)

/s/ CAROLYN N. EVERSON Director November 29, 2022

(Carolyn N. Everson)
/s/ MICHAEL B.G. FROMAN Director November 29, 2022
(Michael B.G. Froman)

/s/ MARIA ELENA LAGOMASINO Director November 29, 2022

(Maria Elena Lagomasino)

/s/ CALVIN R. MCDONALD Director November 29, 2022

(Calvin R. McDonald)
/s/ MARK G. PARKER Director November 29, 2022
(Mark G. Parker)

/s/ DERICA W. RICE Director November 29, 2022

(Derica W. Rice)

62
 THE WALT DISNEY COMPANY AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

Page
Management’s Report on Internal Control Over Financial Reporting 64
Report of Independent Registered Public Accounting Firm (PCAOB ID: 238) 65
Consolidated Financial Statements of The Walt Disney Company and Subsidiaries
Consolidated Statements of Operations for the Years Ended October 1, 2022, October 2, 2021 and
October 3, 2020 67
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended October 1, 2022,
October 2, 2021 and October 3, 2020 68
Consolidated Balance Sheets as of October 1, 2022 and October 2, 2021 69
Consolidated Statements of Cash Flows for the Years Ended October 1, 2022, October 2, 2021 and
October 3, 2020 70
Consolidated Statements of Shareholders’ Equity for the Years Ended October 1, 2022, October 2, 2021
and October 3, 2020 71
Notes to Consolidated Financial Statements 72

All schedules are omitted for the reason that they are not applicable or the required information is included in the financial
statements or notes.

63
 MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such
term is defined in Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting includes those
policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors
of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements prepared for external purposes in accordance with generally accepted
accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
Under the supervision and with the participation of management, including our principal executive officer and principal
financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the
framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission in 2013. Based on our evaluation under the framework in Internal Control - Integrated Framework, management
concluded that our internal control over financial reporting was effective as of October 1, 2022.
The effectiveness of our internal control over financial reporting as of October 1, 2022 has been audited by
PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which is included
herein.

64
 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of The Walt Disney Company

Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of The Walt Disney Company and its subsidiaries (the
“Company”) as of October 1, 2022 and October 2, 2021, and the related consolidated statements of operations, of
comprehensive income (loss), of shareholders’ equity and of cash flows for each of the three years in the period ended
October 1, 2022, including the related notes (collectively referred to as the “consolidated financial statements”). We also have
audited the Company’s internal control over financial reporting as of October 1, 2022, based on criteria established in Internal
Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial
position of the Company as of October 1, 2022 and October 2, 2021, and the results of its operations and its cash flows for each
of the three years in the period ended October 1, 2022 in conformity with accounting principles generally accepted in the
United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over
financial reporting as of October 1, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued
by the COSO.
Change in Accounting Principle
As disclosed in the consolidated statements of shareholders’ equity, the Company changed the manner in which it
accounts for leases in fiscal year 2020.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal
control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included
in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express
opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting
based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material
misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in
all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material
misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the
consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of
internal control over financial reporting included obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal
control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

65
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated
financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to
accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging,
subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the
consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below,
providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Amortization of Production Costs
As described in Note 2 and 7 to the consolidated financial statements and disclosed by management, capitalized film and
television production costs are amortized based on whether the content is predominantly monetized individually or as a group.
Production costs for content that is predominantly monetized individually is amortized based upon the ratio of the current
period’s revenues to the estimated remaining total revenues (Ultimate Revenues). For film productions, Ultimate Revenues
include revenues from all sources, which may include imputed license fees for content that is used by the Company’s DTC
streaming services, that will be earned within ten years from the date of the initial release for theatrical films. For episodic
television series, Ultimate Revenues include revenues that will be earned within ten years, including imputed license fees for
content that is used on the Company’s DTC streaming services, from delivery of the first episode, or if still in production, five
years from delivery of the most recent episode, if later. Production costs that are predominantly monetized as a group are
amortized based on projected usage (which may be, for example, derived from historical viewership patterns), typically
resulting in an accelerated or straight-line amortization pattern. For the year ended October 1, 2022, the Company recognized
$10,224 million of amortization of produced content costs, which is primarily included in “Cost of services” in the consolidated
statements of operations.
The principal considerations for our determination that performing procedures relating to amortization of production costs
is a critical audit matter are the significant auditor effort in performing procedures and evaluating audit evidence used in the
amortization calculation for production costs monetized individually and as a group, and management’s estimates of Ultimate
Revenues and projected usage.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our
overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating
to amortization of production costs, including controls over the estimation of Ultimate Revenues and projected usage. These
procedures also included, among others, (i) testing management’s process for determining the amortization of production costs,
(ii) evaluating whether ultimate revenues for certain content titles were reasonable considering information such as past
performance of comparable titles, future firm commitments to license programs, and current market trends, (iii) evaluating the
accelerated amortization pattern for content predominately monetized as a group, and (iv) testing the completeness and
accuracy of the underlying data used in the amortization calculation for certain titles and for historical viewership data used to
calculate the estimate of projected usage for certain groups.

/s/ PricewaterhouseCoopers LLP

Los Angeles, California
November 29, 2022
We have served as the Company’s auditor since 1938.

66
 CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)

2022 2021 2020

Revenues:
Services $ 74,200 $ 61,768 $ 59,265
Products 8,522 5,650 6,123
Total revenues 82,722 67,418 65,388
Costs and expenses:
Cost of services (exclusive of depreciation and amortization) (48,962) (41,129) (39,406)
Cost of products (exclusive of depreciation and amortization) (5,439) (4,002) (4,474)
Selling, general, administrative and other (16,388) (13,517) (12,369)
Depreciation and amortization (5,163) (5,111) (5,345)
Total costs and expenses (75,952) (63,759) (61,594)
Restructuring and impairment charges (237) (654) (5,735)
Other income (expense), net (667) 201 1,038
Interest expense, net (1,397) (1,406) (1,491)
Equity in the income of investees 816 761 651
Income (loss) from continuing operations before income taxes 5,285 2,561 (1,743)
Income taxes on continuing operations (1,732) (25) (699)
Net income (loss) from continuing operations 3,553 2,536 (2,442)
Loss from discontinued operations, net of income tax benefit of $14, $9 and $10, (48) (29) (32)
respectively
Net income (loss) 3,505 2,507 (2,474)
Net income from continuing operations attributable to noncontrolling and redeemable (360) (512) (390)
noncontrolling interests
Net income (loss) attributable to The Walt Disney Company (Disney) $ 3,145 $ 1,995 $ (2,864)

Earnings (loss) per share attributable to Disney(1):

Diluted
Continuing operations $ 1.75 $ 1.11 $ (1.57)
Discontinued operations (0.03) (0.02) (0.02)
$ 1.72 $ 1.09 $ (1.58)

Basic
Continuing operations $ 1.75 $ 1.11 $ (1.57)
Discontinued operations (0.03) (0.02) (0.02)
$ 1.73 $ 1.10 $ (1.58)

Weighted average number of common and common equivalent shares outstanding:

Diluted 1,827 1,828 1,808
Basic 1,822 1,816 1,808

(1)
Total may not equal the sum of the column due to rounding.

See Notes to Consolidated Financial Statements

67
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in millions)

2022 2021 2020

Net income (loss) $ 3,505 $ 2,507 $ (2,474)
Other comprehensive income (loss), net of tax:
Market value adjustments, primarily for hedges 735 41 (251)
Pension and postretirement medical plan adjustments 2,503 1,850 (1,476)
Foreign currency translation and other (1,060) 77 115
Other comprehensive income (loss) 2,178 1,968 (1,612)
Comprehensive income (loss) 5,683 4,475 (4,086)
Net income from continuing operations attributable to noncontrolling interests (360) (512) (390)
Other comprehensive income (loss) attributable to noncontrolling interests 143 (86) (93)
Comprehensive income (loss) attributable to Disney $ 5,466 $ 3,877 $ (4,569)

See Notes to Consolidated Financial Statements

68
 CONSOLIDATED BALANCE SHEETS
(in millions, except share data)
October 1, October 2,
2022 2021
ASSETS
Current assets
Cash and cash equivalents $ 11,615 $ 15,959
Receivables, net 12,652 13,367
Inventories 1,742 1,331
Content advances 1,890 2,183
Other current assets 1,199 817
Total current assets 29,098 33,657
Produced and licensed content costs 35,777 29,549
Investments 3,218 3,935
Parks, resorts and other property
Attractions, buildings and equipment 66,998 64,892
Accumulated depreciation (39,356) (37,920)
27,642 26,972
Projects in progress 4,814 4,521
Land 1,140 1,131
33,596 32,624
Intangible assets, net 14,837 17,115
Goodwill 77,897 78,071
Other assets 9,208 8,658
Total assets $ 203,631 $ 203,609

LIABILITIES AND EQUITY

Current liabilities
Accounts payable and other accrued liabilities $ 20,213 $ 20,894
Current portion of borrowings 3,070 5,866
Deferred revenue and other 5,790 4,317
Total current liabilities 29,073 31,077
Borrowings 45,299 48,540
Deferred income taxes 8,363 7,246
Other long-term liabilities 12,518 14,522
Commitments and contingencies (Note 14)
Redeemable noncontrolling interests 9,499 9,213
Equity
Preferred stock — —
Common stock, $0.01 par value, Authorized – 4.6 billion shares, Issued – 1.8 billion shares 56,398 55,471
Retained earnings 43,636 40,429
Accumulated other comprehensive loss (4,119) (6,440)
Treasury stock, at cost, 19 million shares (907) (907)
Total Disney Shareholders’ equity 95,008 88,553
Noncontrolling interests 3,871 4,458
Total equity 98,879 93,011
Total liabilities and equity $ 203,631 $ 203,609

See Notes to Consolidated Financial Statements

69
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)

2022 2021 2020

OPERATING ACTIVITIES
Net income (loss) from continuing operations $ 3,553 $ 2,536 $ (2,442)
Depreciation and amortization 5,163 5,111 5,345
Goodwill and intangible asset impairments — — 4,953
Net (gain) loss on investments 714 (332) (920)
Deferred income taxes 200 (1,241) (392)
Equity in the income of investees (816) (761) (651)
Cash distributions received from equity investees 779 754 774
Net change in produced and licensed content costs and advances (6,271) (4,301) 397
Equity-based compensation 977 600 525
Pension and postretirement medical cost amortization 620 816 547
Other, net 595 190 125
Changes in operating assets and liabilities
Receivables 605 (357) 1,943
Inventories (420) 252 14
Other assets (707) 171 (157)
Accounts payable and other liabilities 964 2,410 (2,293)
Income taxes 46 (282) (152)
Cash provided by operations - continuing operations 6,002 5,566 7,616

INVESTING ACTIVITIES
Investments in parks, resorts and other property (4,943) (3,578) (4,022)
Other, net (65) 407 172
Cash used in investing activities - continuing operations (5,008) (3,171) (3,850)

FINANCING ACTIVITIES
Commercial paper payments, net (334) (26) (3,354)
Borrowings 333 64 18,120
Reduction of borrowings (4,016) (3,737) (3,533)
Dividends — — (1,587)
Proceeds from exercise of stock options 127 435 305
Acquisition of redeemable noncontrolling interests — (350) —
Other, net (839) (771) (1,471)
Cash provided by (used in) financing activities - continuing operations (4,729) (4,385) 8,480

CASH FLOWS FROM DISCONTINUED OPERATIONS

Cash provided by operations - discontinued operations 8 1 2
Cash provided by investing activities - discontinued operations — 8 213
Cash used in financing activities - discontinued operations (12) — —
Cash (used in) provided by discontinued operations (4) 9 215

Impact of exchange rates on cash, cash equivalents and restricted cash (603) 30 38

Change in cash, cash equivalents and restricted cash (4,342) (1,951) 12,499
Cash, cash equivalents and restricted cash, beginning of year 16,003 17,954 5,455
Cash, cash equivalents and restricted cash, end of year $ 11,661 $ 16,003 $ 17,954

Supplemental disclosure of cash flow information:

Interest paid $ 1,685 $ 1,892 $ 1,559
Income taxes paid $ 1,097 $ 1,638 $ 738

See Notes to Consolidated Financial Statements

70
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(in millions)
Equity Attributable to Disney
Accumulated
Other
Comprehensive Total Non-
Common Retained Income Treasury Disney controlling
Shares Stock Earnings (Loss) Stock Equity Interests(1) Total Equity
Balance at September 28, 2019 1,802 $ 53,907 $ 42,494 $ (6,617) $ (907) $ 88,877 $ 5,012 $ 93,889
Comprehensive income (loss) — — (2,864) (1,705) — (4,569) 198 (4,371)
Equity compensation activity 8 590 — — — 590 — 590
Dividends — 9 (1,596) — — (1,587) — (1,587)

Contributions — — — — — — 94 94
Adoption of new lease
— — 197 — — 197 — 197
accounting guidance
Distributions and other — (9) 84 — — 75 (624) (549)
Balance at October 3, 2020 1,810 $ 54,497 $ 38,315 $ (8,322) $ (907) $ 83,583 $ 4,680 $ 88,263
Comprehensive income — — 1,995 1,882 — 3,877 284 4,161
Equity compensation activity 8 904 — — — 904 — 904
Contributions — — — — — — 89 89
Cumulative effect of
— — 109 — — 109 — 109
accounting change
Distributions and other — 70 10 — — 80 (595) (515)
Balance at October 2, 2021 1,818 $ 55,471 $ 40,429 $ (6,440) $ (907) $ 88,553 $ 4,458 $ 93,011
Comprehensive income (loss) — — 3,145 2,321 — 5,466 (68) 5,398
Equity compensation activity 6 925 — — — 925 — 925
Contributions — — — — — — 74 74
Distributions and other — 2 62 — — 64 (593) (529)

Balance at October 1, 2022 1,824 $ 56,398 $ 43,636 $ (4,119) $ (907) $ 95,008 $ 3,871 $ 98,879

(1)
Excludes redeemable noncontrolling interest.

See Notes to Consolidated Financial Statements

71
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Tabular dollars in millions, except where noted and per share amounts)

1 Description of the Business and Segment Information

The Walt Disney Company, together with the subsidiaries through which businesses are conducted (the Company), is a
diversified worldwide entertainment company with operations in the Disney Media and Entertainment Distribution (DMED)
and Disney Parks, Experiences and Products (DPEP) segments.
The terms “Company”, “we”, “our” and “us” are used in this report to refer collectively to the parent company and the
subsidiaries through which businesses are conducted.
Impact of COVID-19
Since early 2020, the world has been, and continues to be, impacted by the novel coronavirus (COVID-19) and its
variants. COVID-19 and measures to prevent its spread have impacted our segments in a number of ways, most significantly at
DPEP where our theme parks and resorts were closed and cruise ship sailings and guided tours were suspended. In addition, at
DMED we delayed, or in some cases, shortened or cancelled theatrical releases and experienced disruptions in the production
and availability of content. Operations have resumed at various points since May 2020, with certain theme park and resort
operations and film and television productions resuming by the end of fiscal 2020 and throughout fiscal 2021. Although
operations resumed, many of our businesses continue to experience impacts from COVID-19, such as incremental health and
safety measures and related increased expenses, capacity restrictions and closures (including at some of our international parks
and in theaters in certain markets), and disruption of content production activities.
The impact of COVID-19 related disruptions on our financial and operating results will be dictated by the currently
unknowable duration and severity of COVID-19 and its variants, and among other things, governmental actions imposed in
response to COVID-19 and individuals’ and companies’ risk tolerance regarding health matters going forward. We have
incurred and will continue to incur additional costs to address government regulations and the safety of our employees, guests
and talent.
In fiscal 2020, the Company recorded goodwill and intangible asset impairments totaling $5.0 billion, in part due to the
negative impact COVID-19 has had on the International Channels business (see Note 18).

DESCRIPTION OF THE BUSINESS

Disney Media and Entertainment Distribution
DMED encompasses the Company’s global film and episodic television content production and distribution
activities. Content is distributed by a single organization across three significant lines of business: Linear Networks, Direct-to-
Consumer and Content Sales/Licensing. Content is generally created/licensed by four groups: Studios, General Entertainment,
Sports and International. The distribution organization has full accountability for the financial results of the entire media and
entertainment business.
The operations of DMED’s significant lines of business are as follows:
• Linear Networks
◦ Domestic Channels: ABC Television Network and eight owned ABC television stations (Broadcasting), and
Disney, ESPN (80% interest), Freeform, FX and National Geographic (73% interest) branded domestic television
networks (Cable)
◦ International Channels: Disney, ESPN, Fox, National Geographic and Star branded television networks outside the
U.S.
◦ A 50% equity investment in A+E Television Networks (A+E), which operates a variety of cable channels including
A&E, HISTORY and Lifetime
• Direct-to-Consumer
◦ Disney+, Disney+ Hotstar, ESPN+ (68% effective interest), Hulu and Star+ direct-to-consumer (DTC) video
streaming services
• Content Sales/Licensing
◦ Sale/licensing of film and television content to third-party television and subscription/advertising video-on-demand
(TV/SVOD) services
◦ Theatrical distribution
◦ Home entertainment distribution (DVD, Blu-ray discs and electronic home video licenses)
◦ Music distribution

72
 ◦ Staging and licensing of live entertainment events on Broadway and around the world (Stage Plays)
DMED also includes the following activities that are reported with Content Sales/Licensing:
• Post-production services by Industrial Light & Magic and Skywalker Sound
• National Geographic magazine and online business
• A 30% ownership interest in Tata Play Limited (formerly Tata Sky Limited), which operates a direct-to-home satellite
distribution platform in India
The significant revenues of DMED are as follows:
• Affiliate fees - Fees charged by our Linear Networks to multi-channel video programming distributors (i.e. cable,
satellite, telecommunications and digital over-the-top (e.g. YouTube TV) service providers) (MVPDs) and television
stations affiliated with the ABC Network for the right to deliver our programming to their customers
• Subscription fees - Fees charged to customers/subscribers for our DTC streaming services
• Advertising - Sales of advertising time/space on our Linear Networks and Direct-to-Consumer
• TV/SVOD distribution - Licensing fees and other revenue for the right to use our film and television productions and
revenue from fees charged to customers to view our sports programming (“pay-per-view”) and fees for streaming
access to films that are also playing in theaters (“Premier Access”). TV/SVOD distribution revenue is primarily
reported in Content Sales/Licensing, except for pay-per-view and Premier Access revenues, which are reported in
Direct-to-Consumer.
• Theatrical distribution - Rentals from licensing our film productions to theaters
• Home entertainment - Sale of our film and television content to retailers and distributors in home video formats
• Other content sales/licensing revenue - Revenues from licensing our music, ticket sales from stage play performances
and fees from licensing our intellectual properties (“IP”) for use in stage plays
• Other revenue - Fees from sub-licensing of sports programming rights (reported in Linear Networks) and sales of post-
production services (reported with Content Sales/Licensing)
The significant expenses of DMED are as follows:
• Operating expenses consist primarily of programming and production costs, technical support costs, operating labor,
distribution costs and costs of sales. Programming and production costs include amortization of licensed programming
rights (including sports rights), amortization of capitalized production costs, subscriber-based fees for programming
our Hulu services, production costs related to live programming such as news and sports and amortization of
participations and residual obligations. Programming and production costs also include fees paid to Linear Networks
from other DMED businesses for the right to air our linear networks and related services. These costs are largely
incurred across four content creation/licensing groups, as follows:
◦ Studios - Primarily capitalized production costs related to films produced under the Walt Disney Pictures,
Twentieth Century Studios, Marvel, Lucasfilm, Pixar and Searchlight Pictures banners
◦ General Entertainment - Primarily internal production of and acquisition of rights to episodic television programs
and news content. Internal content is generally produced by the following television studios: ABC Signature; 20th
Television; Disney Television Animation, FX Productions and various studios for which we commission
productions for our branded channels and DTC streaming services.
◦ Sports - Primarily acquisition of professional and college sports programming rights and related production costs
◦ International - Primarily internal production of and acquisition of rights to local content outside the U.S. and
Canada.
• Selling, general and administrative costs, including marketing costs
• Depreciation and amortization
Disney Parks, Experiences and Products
The operations of DPEP’s significant lines of business are as follows:
• Parks & Experiences:
◦ Theme parks and resorts, which include: Walt Disney World Resort in Florida; Disneyland Resort in California;
Disneyland Paris; Hong Kong Disneyland Resort (48% ownership interest); and Shanghai Disney Resort (43%
ownership interest), all of which are consolidated in our results. Additionally, the Company licenses our IP to a
third party to operate Tokyo Disney Resort
◦ Disney Cruise Line, Disney Vacation Club, National Geographic Expeditions (73% ownership interest),
Adventures by Disney and Aulani, a Disney Resort & Spa in Hawaii

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 • Consumer Products:
◦ Licensing of our trade names, characters, visual, literary and other IP to various manufacturers, game developers,
publishers and retailers throughout the world, for use on merchandise, published materials and games
◦ Sale of branded merchandise through online, retail and wholesale businesses, and development and publishing of
books, comic books and magazines (except National Geographic, which is reported in DMED)
The significant revenues of DPEP are as follows:
• Theme park admissions - Sales of tickets for admission to our theme parks and for premium access to certain
attractions (e.g. Genie+ and Lightning Lane)
• Parks & Experiences merchandise, food and beverage - Sales of merchandise, food and beverages at our theme parks
and resorts and cruise ships
• Resorts and vacations - Sales of room nights at hotels, sales of cruise and other vacations and sales and rentals of
vacation club properties
• Merchandise licensing and retail:
◦ Merchandise licensing - Royalties from licensing our IP for use on consumer goods
◦ Retail - Sales of merchandise through internet shopping sites generally branded shopDisney and at The Disney
Store, as well as to wholesalers (including books, comic books and magazines)
• Parks licensing and other - Revenues from sponsorships and co-branding opportunities, real estate rent and sales and
royalties earned on Tokyo Disney Resort revenues
The significant expenses of DPEP are as follows:
• Operating expenses consist primarily of operating labor, costs of goods sold, infrastructure costs, supplies,
commissions and entertainment offerings. Infrastructure costs include technology support costs, repairs and
maintenance, property taxes, utilities and fuel, retail occupancy costs, insurance and transportation
• Selling, general and administrative costs, including marketing costs
• Depreciation and amortization

SEGMENT INFORMATION
Our operating segments report separate financial information, which is evaluated regularly by the Chief Executive Officer
in order to decide how to allocate resources and to assess performance.
Segment operating results reflect earnings before corporate and unallocated shared expenses, restructuring and impairment
charges, net other income, net interest expense, income taxes and noncontrolling interests. Segment operating income includes
equity in the income of investees and excludes impairments of certain equity investments and acquisition accounting
amortization of TFCF Corporation (TFCF) and Hulu assets (i.e. intangible assets and the fair value step-up for film and
television costs) recognized in connection with the TFCF acquisition in fiscal 2019 (TFCF and Hulu acquisition amortization).
Corporate and unallocated shared expenses principally consist of corporate functions, executive management and certain
unallocated administrative support functions.
Segment operating results include allocations of certain costs, including information technology, pension, legal and other
shared services costs, which are allocated based on metrics designed to correlate with consumption.

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 Segment revenues and segment operating income are as follows:
2022 2021 2020
Revenues
Disney Media and Entertainment Distribution $ 55,040 $ 50,866 $ 48,350
Disney Parks, Experiences and Products 28,705 16,552 17,038
Total segment revenues $ 83,745 $ 67,418 $ 65,388
Segment operating income
Disney Media and Entertainment Distribution $ 4,216 $ 7,295 $ 7,653
Disney Parks, Experiences and Products 7,905 471 455
Total segment operating income(1) $ 12,121 $ 7,766 $ 8,108
(1)
Equity in the income of investees is included in segment operating income as follows:
2022 2021 2020
Disney Media and Entertainment Distribution $ 838 $ 795 $ 696
Disney Parks, Experiences and Products (10) (19) (19)
Equity in the income of investees included in segment
operating income 828 776 677
Amortization of TFCF intangible assets related to equity
investees (12) (15) (26)
Equity in the income of investees $ 816 $ 761 $ 651

A reconciliation of segment revenues to total revenues is as follows:

2022 2021 2020

Segment revenues $ 83,745 $ 67,418 $ 65,388
Content License Early Termination(1) (1,023) — —
Total revenues $ 82,722 $ 67,418 $ 65,388
(1)
In fiscal 2022, the Company recognized a reduction in revenue for amounts to early terminate certain license
agreements with a customer for film and television content, which was delivered in previous years, in order for the
Company to use the content primarily on our direct-to-consumer services (Content License Early Termination).
Because the content is functional IP, we recognized substantially all of the consideration to be paid by the customer
under the licenses as revenue in prior years when the content was made available under the agreements. Consequently,
we have recorded the amounts to terminate the license agreements, net of remaining amounts of deferred revenue, as a
reduction of revenue in the current year.
A reconciliation of segment operating income to income from continuing operations before income taxes is as follows:
2022 2021 2020
Segment operating income $ 12,121 $ 7,766 $ 8,108
Content License Early Termination (1,023) — —
Corporate and unallocated shared expenses (1,159) (928) (817)
Restructuring and impairment charges (237) (654) (5,735)
Other income, net (667) 201 1,038
Interest expense, net (1,397) (1,406) (1,491)
TFCF and Hulu acquisition amortization(1) (2,353) (2,418) (2,846)
Income (loss) from continuing operations before income taxes $ 5,285 $ 2,561 $ (1,743)
(1)
For fiscal 2022, amortization of intangible assets, fair value step-up on film and television costs and intangibles related
to TFCF equity investees were $1,707 million, $634 million and $12 million, respectively. For fiscal 2021,
amortization of intangible assets, fair value step-up on film and television costs and intangibles related to TFCF equity
investees were $1,757 million, $646 million and $15 million, respectively. For fiscal 2020, amortization of intangible
assets, fair value step-up on film and television costs and intangibles related to TFCF equity investees were
$1,921 million, $899 million and $26 million, respectively.

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 Capital expenditures, depreciation expense and amortization expense are as follows:
Capital expenditures 2022 2021 2020
Disney Media and Entertainment Distribution $ 810 $ 862 $ 783
Disney Parks, Experiences and Products
Domestic 2,680 1,597 2,145
International 767 675 759
Corporate 686 444 335
Total capital expenditures $ 4,943 $ 3,578 $ 4,022

Depreciation expense
Disney Media and Entertainment Distribution $ 650 $ 613 $ 638
Disney Parks, Experiences and Products
Domestic 1,680 1,551 1,634
International 662 718 694
Amounts included in segment operating income 2,342 2,269 2,328
Corporate 191 186 174
Total depreciation expense $ 3,183 $ 3,068 $ 3,140

Amortization of intangible assets

Disney Media and Entertainment Distribution $ 164 $ 178 $ 175
Disney Parks, Experiences and Products 109 108 109
Amounts included in segment operating income 273 286 284
TFCF and Hulu 1,707 1,757 1,921
Total amortization of intangible assets $ 1,980 $ 2,043 $ 2,205

Identifiable assets, including equity method investments and intangible assets,(1) are as follows:
October 1, October 2,
2022 2021
Disney Media and Entertainment Distribution $ 148,129 $ 144,675
Disney Parks, Experiences and Products 43,027 41,763
Corporate (primarily fixed asset and cash and cash equivalents) 12,475 17,171
Total consolidated assets $ 203,631 203,609
(1)
Equity method investments included in identifiable assets by segment are as follows:
October 1, October 2,
2022 2021
Disney Media and Entertainment Distribution $ 2,633 $ 2,578
Disney Parks, Experiences and Products 2 2
Corporate 43 58
$ 2,678 $ 2,638

Intangible assets, which include character/franchise intangibles, copyrights, trademarks, MVPD agreements and FCC
licenses (see Note 13), included in identifiable assets by segment are as follows:
October 1, October 2,
2022 2021
Disney Media and Entertainment Distribution $ 11,981 $ 14,143
Disney Parks, Experiences and Products 2,836 2,952
Corporate 20 20
$ 14,837 $ 17,115

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 The following table presents our revenues and segment operating income by geographical markets:
2022 2021 2020
Revenues
Americas $ 68,218 $ 54,157 $ 51,992
Europe 8,680 6,690 7,333
Asia Pacific 6,847 6,571 6,063
83,745 $ 67,418 $ 65,388
Content License Early Termination (1,023)
$ 82,722

Segment operating income (loss)

Americas $ 11,099 $ 6,314 $ 5,819
Europe 586 800 1,273
Asia Pacific 436 652 1,016
$ 12,121 $ 7,766 $ 8,108

Long-lived assets(1) by geographical markets are as follows:

October 1, October 2,
2022 2021
Americas $ 150,786 $ 144,788
Europe 8,739 8,215
Asia Pacific 10,976 12,012
$ 170,501 $ 165,015
(1)
Long-lived assets are total assets less: current assets, long-term receivables, deferred taxes, financial investments and
the fair value of derivative instruments.
The changes in the carrying amount of goodwill are as follows:
DMED DPEP Total
Balance at Oct. 3, 2020 $ 72,139 $ 5,550 $ 77,689
Currency translation adjustments and other, net 382 — 382
Balance at Oct. 2, 2021 $ 72,521 $ 5,550 $ 78,071
Currency translation adjustments and other, net (174) — (174)
Balance at Oct. 1, 2022 $ 72,347 $ 5,550 $ 77,897

2 Summary of Significant Accounting Policies

Principles of Consolidation
The consolidated financial statements of the Company include the accounts of The Walt Disney Company and its
majority-owned or controlled subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation.
The Company enters into relationships with or makes investments in other entities that may be variable interest entities
(VIE). A VIE is consolidated in the financial statements if the Company has the power to direct activities that most significantly
impact the economic performance of the VIE and has the obligation to absorb losses or the right to receive benefits from the
VIE that could potentially be significant (as defined by ASC 810-10-25-38) to the VIE. Hong Kong Disneyland Resort and
Shanghai Disney Resort (together, the Asia Theme Parks) are VIEs in which the Company has less than 50% equity ownership.
Company subsidiaries (the Management Companies) have management agreements with the Asia Theme Parks, which provide
the Management Companies, subject to certain protective rights of joint venture partners, with the ability to direct the day-to-
day operating activities and the development of business strategies that we believe most significantly impact the economic
performance of the Asia Theme Parks. In addition, the Management Companies receive management fees under these
arrangements that we believe could be significant to the Asia Theme Parks. Therefore, the Company has consolidated the Asia
Theme Parks in its financial statements.

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Reporting Period
The Company’s fiscal year ends on the Saturday closest to September 30 and consists of fifty-two weeks with the
exception that approximately every six years, we have a fifty-three week year. When a fifty-three week year occurs, the
Company reports the additional week in the fourth quarter. Fiscal 2022 and 2021 were fifty-two week years. Fiscal 2020 was a
fifty-three week year, which began on September 29, 2019 and ended on October 3, 2020.
Reclassifications
Certain reclassifications have been made in the fiscal 2021 and fiscal 2020 financial statements and notes to conform to
the fiscal 2022 presentation.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual
results may differ from those estimates.
Revenues and Costs from Services and Products
The Company generates revenue from the sale of both services and tangible products and revenues and operating costs are
classified under these two categories in the Consolidated Statements of Operations. Certain costs related to both the sale of
services and tangible products are not specifically allocated between the service or tangible product revenue streams but are
instead attributed to the principal revenue stream. The cost of services and tangible products exclude depreciation and
amortization.
Significant service revenues include:
• Affiliate fees
• Subscription fees to our DTC streaming services
• Advertising revenues
• Admissions to our theme parks, charges for room nights at hotels and sales of cruise vacation packages
• Revenue from the licensing and distribution of film and television properties
• Royalties from licensing our IP for use on consumer goods, published materials and in multi-platform games
Significant operating costs related to the sale of services include:
• Programming and production costs
• Distribution costs
• Operating labor
• Facilities and infrastructure costs
Significant tangible product revenues include:
• The sale of food, beverage and merchandise at our retail locations
• The sale of DVDs and Blu-ray discs
• The sale of books, comic books and magazines
Significant operating costs related to the sale of tangible products include:
• Costs of goods sold
• Operating labor
• Programming and production costs
• Distribution costs
• Retail occupancy costs
Revenue Recognition
The Company’s revenue recognition policies are as follows:
• Affiliate fees are recognized as the programming is provided based on contractually specified per subscriber rates and
the actual number of the affiliate’s customers receiving the programming. For affiliate contracts with fixed license
fees, the fees are recognized ratably over the contract term. If an affiliate contract includes a minimum guaranteed
license fee, the guaranteed license fee is recognized ratably over the guaranteed period and any fees earned in excess
of the guarantee are recognized as earned once the minimum guarantee has been exceeded. Affiliate agreements may
also include a license to use the network programming for on demand viewing. As the fees charged under these
contracts are generally based on a contractually specified per subscriber rate for the number of underlying subscribers
of the affiliate, revenues are recognized as earned.

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 • Subscription fees are recognized ratably over the term of the subscription.
• Advertising sales are recognized as revenue, net of agency commissions, when commercials are aired. For contracts
that contain a guaranteed number of impressions, revenues are recognized based on impressions delivered. When the
guaranteed number of impressions is not met (“ratings shortfall”), revenues are not recognized for the ratings shortfall
until the additional impressions are delivered.
• Theme park admissions are recognized when the tickets are used. Sales of annual passes are recognized ratably over
the period for which the pass is available for use.
• Resorts and vacations sales are recognized as revenue as the services are provided to the guest. Sales of vacation club
properties are recognized as revenue upon the later of when title transfers to the customer or when construction activity
is deemed complete.
• Merchandise, food and beverage sales are recognized at the time of sale. Sales from our branded internet shopping
sites and to wholesalers are recognized upon delivery. We estimate returns and customer incentives based upon
historical return experience, current economic trends and projections of consumer demand for our products.
• Merchandise licensing fees are recognized as revenue as earned based on the contractual royalty rate applied to the
licensee’s underlying product sales. For licenses with minimum guaranteed license fees, the excess of the minimum
guaranteed amount over actual royalties earned (“shortfall”) is recognized straight-line over the remaining license
period once an expected shortfall is probable.
• TV/SVOD distribution fixed license fees are recognized as revenue when the content is available for use by the
licensee. License fees based on the underlying sales of the licensee are recognized as revenue as earned based on the
contractual royalty rate applied to the licensee sales.
For TV/SVOD licenses that include multiple titles with a fixed license fee across all titles, each title is considered a
separate performance obligation. The fixed license fee is allocated to each title at contract inception and the allocated
license fee is recognized as revenue when the title is available for use by the licensee.
When the license contains a minimum guaranteed license fee across all titles, the license fees earned by titles in excess
of their allocated amount are deferred until the minimum guaranteed license fee across all titles is exceeded. Once the
minimum guaranteed license fee is exceeded, revenue is recognized as earned based on the licensee’s underlying sales.
TV/SVOD distribution contracts may limit the licensee’s use of a title to certain defined periods of time during the
contract term. In these instances, each period of availability is generally considered a separate performance obligation.
For these contracts, the fixed license fee is allocated to each period of availability at contract inception based on
relative standalone selling price using management’s best estimate. Revenue is recognized at the start of each
availability period when the content is made available for use by the licensee.
When the term of an existing agreement is renewed or extended, revenues are recognized when the licensed content
becomes available under the renewal or extension.
• Theatrical distribution licensing fees are recognized as revenue based on the contractual royalty rate applied to the
distributor’s underlying sales from exhibition of the film.
• Home entertainment sales in physical formats are recognized as revenue on the later of the delivery date or the date
that the product can be sold by retailers. We reduce home entertainment revenues for estimated future returns of
merchandise and sales incentives based upon historical return experience, current economic trends and projections of
consumer demand for our products. Sales of our films in electronic formats are recognized as revenue when the
product is available for use by the consumer.
• Taxes collected from customers and remitted to governmental authorities are excluded from revenue.
• Shipping and handling fees collected from customers are recorded as revenue and the related shipping expenses are
recorded in cost of products upon delivery of the product to the consumer.
Allowance for Credit Losses
We evaluate our allowance for credit losses and estimate collectability of current and non-current accounts receivable
based on historical bad debt experience, our assessment of the financial condition of individual companies with which we do
business, current market conditions and reasonable supportable forecasts of future economic conditions.
Advertising Expense
Advertising costs are expensed as incurred. Advertising expense for fiscal 2022, 2021 and 2020 was $7.2 billion, $5.5
billion and $4.7 billion, respectively. The increase in advertising expense for fiscal 2022 compared to fiscal 2021 was due to
higher spend for our DTC streaming services and an increase in theatrical marketing costs. The increase in advertising expense
for fiscal 2021 compared to fiscal 2020 was due to higher spend for our DTC streaming services.

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Cash and Cash Equivalents
Cash and cash equivalents consist of cash on hand and marketable securities with original maturities of three months or
less.
Cash and cash equivalents subject to contractual restrictions and not readily available are classified as restricted cash. The
Company’s restricted cash balances are primarily made up of cash posted as collateral for certain derivative instruments.
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Consolidated
Balance Sheet to the total of the amounts in the Consolidated Statements of Cash Flows.
October 1, October 2, October 3,
2022 2021 2020
Cash and cash equivalents $ 11,615 $ 15,959 $ 17,914
Restricted cash included in:
Other current assets 3 3 3
Other assets 43 41 37
Total cash, cash equivalents and restricted cash in the statement
of cash flows $ 11,661 $ 16,003 $ 17,954

Investments
Investments in equity securities with a readily determinable fair value, not accounted for under the equity method, are
recorded at that value with unrealized gains and losses included in earnings. For equity securities without a readily determinable
fair value, the investment is recorded at cost, less any impairment, plus or minus adjustments related to observable transactions
for the same or similar securities, with unrealized gains and losses included in earnings.
For equity method investments, the Company regularly reviews its investments to determine whether there is a decline in
fair value below book value. If there is a decline that is other-than-temporary, the investment is written down to fair value.
Translation Policy
Generally, the U.S. dollar is the functional currency for our international film and television distribution and licensing
businesses and the branded International Channels and DTC streaming services. Generally, the local currency is the functional
currency for the Asia Theme Parks, Disneyland Paris, the Star branded channels in India, international sports channels and
international locations of The Disney Store.
For U.S. dollar functional currency locations, foreign currency assets and liabilities are remeasured into U.S. dollars at
end-of-period exchange rates, except for non-monetary balance sheet accounts, which are remeasured at historical exchange
rates. Revenue and expenses are remeasured at average exchange rates in effect during each period, except for those expenses
related to the non-monetary balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from
foreign currency remeasurement are included in income.
For local currency functional locations, assets and liabilities are translated at end-of-period rates while revenues and
expenses are translated at average rates in effect during the period. Equity is translated at historical rates and the resulting
cumulative translation adjustments are included as a component of accumulated other comprehensive income (loss) (AOCI).
Inventories
Inventory primarily includes vacation timeshare units, merchandise, food, materials and supplies. Carrying amounts of
vacation ownership units are recorded at the lower of cost or net realizable value. Carrying amounts of merchandise, food,
materials and supplies inventories are generally determined on a moving average cost basis and are recorded at the lower of cost
or net realizable value.
Film and Television Content Costs
The Company classifies its capitalized produced and acquired/licensed content costs as long-term assets (“Produced and
licensed content costs” in the Consolidated Balance Sheet) and classifies advances for live programming rights made prior to
the live event as short-term assets (“Content advances” in the Consolidated Balance Sheet). For produced content, we capitalize
all direct costs incurred in the physical production of a film, as well as allocations of production overhead and capitalized
interest. For licensed and acquired content, we capitalize the license fee or acquisition cost, respectively. For purposes of
amortization and impairment, the capitalized content costs are classified based on their predominant monetization strategy as
follows:
• Individual - lifetime value is predominantly derived from third-party revenues that are directly attributable to the
specific film or television title (e.g. theatrical revenues or sales to third-party television programmers)

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 • Group - lifetime value is predominantly derived from third-party revenues that are attributable only to a bundle of titles
(e.g. subscription revenue for a DTC service or affiliate fees for a cable television network)
The determination of the predominant monetization strategy is made at commencement of production on a consolidated
basis and is based on the means by which we derive third-party revenues from use of the content. Imputed title by title license
fees that may be necessary for other purposes are established as required for those purposes.
We generally classify content that is initially intended for use on our DTC streaming services or Linear Networks as group
assets. We generally classify content initially intended for theatrical release or for sale to third-party licensees as individual
assets. The predominant monetization strategy for content released prior to the beginning of fiscal 2020 (the date the Company
adopted accounting guidance that was applied prospectively) was determined based on the expected means of monetization
over the remaining life of the content. Thus for example, film titles that were released theatrically and in home entertainment
prior to fiscal year 2020 and are now distributed on Disney+ are generally considered group content.
The classification of content as individual or group only changes if there is a significant change to the title’s monetization
strategy relative to its initial assessment (e.g. content that was initially intended for license to a third party is instead used on an
owned DTC service). When there is a significant change in monetization strategy, the title’s capitalized content costs are tested
for impairment.
Production costs for content that is predominantly monetized individually are amortized based upon the ratio of the
current period’s revenues to the estimated remaining total revenues (Ultimate Revenues). For film productions, Ultimate
Revenues include revenues from all sources, which may include imputed license fees for content that is used on our DTC
streaming services, that will be earned within ten years from the date of the initial release for theatrical films. For episodic
television series that are classified as individual, Ultimate Revenues include revenues that will be earned within ten years,
including imputed license fees for content that is used on our DTC streaming services, from delivery of the first episode, or if
still in production, five years from delivery of the most recent episode, if later. Participations and residuals are expensed over
the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total revenues
for each production.
Production costs that are predominantly monetized as a group are amortized based on projected usage, generally resulting
in an accelerated or straight-line amortization pattern. Adjustments to projected usage are applied prospectively in the period of
the change. Participations and residuals are generally expensed in line with the pattern of usage.
Licensed rights to film and television content and other programs for broadcast on our Linear Networks or DTC streaming
services are expensed on an accelerated or straight-line basis over their useful life or over the number of times the program is
expected to be aired, as appropriate. We amortize rights costs for multi-year sports programming arrangements during the
applicable seasons based on the estimated relative value of each year in the arrangement. If annual contractual payments related
to each season approximate each season’s estimated relative value, we expense the related contractual payments during the
applicable season.
Acquired film and television libraries are generally amortized on a straight-line basis over 20 years from the date of
acquisition. Acquired film and television libraries include content that was initially released three years prior to its acquisition,
except it excludes the prior seasons of episodic television programming still in production at the date of its acquisition.
Amortization of capitalized costs for produced and acquired content begins in the month the content is first released, while
amortization of capitalized costs for licensed content commences when the license period begins and the content is first aired or
available for use on our DTC services. Amortization of content assets is primarily included in “Cost of services” in the
Consolidated Statements of Operations.
The costs of produced and licensed film and television content are subject to regular recoverability assessments. For
content that is predominantly monetized individually, the unamortized costs are compared to the estimated fair value. The fair
value is determined based on a discounted cash flow analysis of the cash flows directly attributable to the title. To the extent the
unamortized costs exceed the fair value, an impairment charge is recorded for the excess. For content that is predominantly
monetized as a group, the aggregate unamortized costs of the group are compared to the present value of the discounted cash
flows using the lowest level for which identifiable cash flows are independent of other produced and licensed content. If the
unamortized costs exceed the present value of discounted cash flows, an impairment charge is recorded for the excess and
allocated to individual titles based on the relative carrying value of each title in the group. If there are no plans to continue to
use an individual film or television program that is part of a group, the unamortized cost of the individual title is written-off
immediately. Licensed content is included as part of the group within which it is monetized for purposes of assessing
recoverability.

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Internal-Use Software Costs
The Company expenses costs incurred in the preliminary project stage of developing or acquiring internal use software,
such as research and feasibility studies as well as costs incurred in the post-implementation/operational stage, such as
maintenance and training. Capitalization of software development costs occurs only after the preliminary-project stage is
complete, management authorizes the project and it is probable that the project will be completed and the software will be used
for the function intended. As of October 1, 2022 and October 2, 2021, capitalized software costs, net of accumulated
amortization, totaled $1.1 billion and $1.2 billion, respectively. The capitalized costs are amortized on a straight-line basis over
the estimated useful life of the software up to 7 years.

Parks, Resorts and Other Property

Parks, resorts and other property are carried at historical cost. Depreciation is computed on the straight-line method,
generally over estimated useful lives as follows:
Attractions, buildings and improvements 20 – 40 years
Furniture, fixtures and equipment 3 – 25 years
Land improvements 20 – 40 years
Leasehold improvements Life of lease or asset life if less

Leases
The Company determines whether a contract is a lease at contract inception or for a modified contract at the modification
date. At inception or modification, the Company calculates the present value of operating lease payments using the Company’s
incremental borrowing rate applicable to the lease, which is determined by estimating what it would cost the Company to
borrow a collateralized amount equal to the total lease payments over the lease term based on the contractual terms of the lease
and the location of the leased asset. Our leases may require us to make fixed rental payments, variable lease payments based on
usage or sales and fixed non-lease costs relating to the leased asset. Variable lease payments are generally not included in the
measurement of the right-of-use asset and lease liability. Fixed non-lease costs, for example common-area maintenance costs,
are included in the measurement of the right-of-use asset and lease liability as the Company does not separate lease and non-
lease components.
Goodwill, Other Intangible Assets and Long-Lived Assets
The Company is required to test goodwill and other indefinite-lived intangible assets for impairment on an annual basis
and if current events or circumstances require, on an interim basis. The Company performs its annual test of goodwill and
indefinite-lived intangible assets for impairment in its fiscal fourth quarter.
Goodwill is allocated to various reporting units, which are an operating segment or one level below the operating
segment. To test goodwill for impairment, the Company first performs a qualitative assessment to determine if it is more likely
than not that the carrying amount of a reporting unit exceeds its fair value. If it is, a quantitative assessment is required.
Alternatively, the Company may bypass the qualitative assessment and perform a quantitative impairment test.
The qualitative assessment requires the consideration of factors such as recent market transactions, macroeconomic
conditions, and changes in projected future cash flows of the reporting unit.
The quantitative assessment compares the fair value of each goodwill reporting unit to its carrying amount, and to the
extent the carrying amount exceeds the fair value, an impairment of goodwill is recognized for the excess up to the amount of
goodwill allocated to the reporting unit.
In fiscal 2022, the Company bypassed the qualitative test and performed a quantitative assessment of goodwill for
impairment.
The impairment test for goodwill requires judgment related to the identification of reporting units, the assignment of
assets and liabilities to reporting units including goodwill, and the determination of fair value of the reporting units. To
determine the fair value of our reporting units, we apply what we believe to be the most appropriate valuation methodology for
each of our reporting units. We generally use a present value technique (discounted cash flows) corroborated by market
multiples when available and as appropriate. The discounted cash flow analyses are sensitive to our estimates of future revenue
growth and margins for these businesses as well as the discount rates used to calculate the present value of future cash flows. In
times of adverse economic conditions in the global economy, the Company’s long-term cash flow projections are subject to a
greater degree of uncertainty than usual. We believe our estimates are consistent with how a marketplace participant would
value our reporting units. If we had established different reporting units or utilized different valuation methodologies or
assumptions, the impairment test results could differ, and we could be required to record impairment charges.
To test its other indefinite-lived intangible assets for impairment, the Company first performs a qualitative assessment to
determine if it is more likely than not that the carrying amount of each of its indefinite-lived intangible assets exceeds its fair

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value. If it is, a quantitative assessment is required. Alternatively, the Company may bypass the qualitative assessment and
perform a quantitative impairment test.
The qualitative assessment requires the consideration of factors such as recent market transactions, macroeconomic
conditions, and changes in projected future cash flows.
The quantitative assessment compares the fair value of an indefinite-lived intangible asset to its carrying amount. If the
carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized for the excess.
Fair values of indefinite-lived intangible assets are determined based on discounted cash flows or appraised values, as
appropriate. The Company has determined that there are currently no legal, competitive, economic or other factors that
materially limit the useful life of our FCC licenses and trademarks, which are our most significant indefinite-lived intangible
assets.
Finite-lived intangible assets are generally amortized on a straight-line basis over periods up to 40 years. The costs to
periodically renew our intangible assets are expensed as incurred.
The Company tests long-lived assets, including amortizable intangible assets, for impairment whenever events or changes
in circumstances (triggering events) indicate that the carrying amount may not be recoverable. Once a triggering event has
occurred, the impairment test employed is based on whether the Company’s intent is to hold the asset for continued use or to
hold the asset for sale. The impairment test for assets held for use requires a comparison of the estimated undiscounted future
cash flows expected to be generated over the useful life of the significant assets of an asset group to the carrying amount of the
asset group. An asset group is generally established by identifying the lowest level of cash flows generated by a group of assets
that are largely independent of the cash flows of other assets and could include assets used across multiple businesses. If the
carrying amount of an asset group exceeds the estimated undiscounted future cash flows, an impairment would be measured as
the difference between the fair value of the asset group and the carrying amount of the asset group. For assets held for sale, to
the extent the carrying amount is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the
difference.
The Company recorded non-cash impairment charges of $0.2 billion, $0.3 billion, and $5.2 billion in fiscal 2022, 2021
and 2020, respectively.
The fiscal 2022 charges primarily related to our businesses in Russia.
The fiscal 2021 charges primarily related to the closure of an animation studio and a substantial number of our Disney-
branded retail stores in North America and Europe.
The fiscal 2020 impairment charges primarily related to impairments of MVPD agreement intangibles assets ($1.9 billion)
and goodwill ($3.1 billion) at the International Channels business. See Note 18 to the Consolidated Financial Statements for
additional discussion of these impairment charges.
The Company expects its aggregate annual amortization expense for finite-lived intangible assets for fiscal 2023 through
2027 to be as follows:
2023 $ 1,808
2024 1,570
2025 1,459
2026 966
2027 888

Risk Management Contracts

In the normal course of business, the Company employs a variety of financial instruments (derivatives) including interest
rate and cross-currency swap agreements and forward and option contracts to manage its exposure to fluctuations in interest
rates, foreign currency exchange rates and commodity prices.
The Company formally documents all relationships between hedges and hedged items as well as its risk management
objectives and strategies for undertaking various hedge transactions. The Company primarily enters into two types of
derivatives: hedges of fair value exposure and hedges of cash flow exposure. Hedges of fair value exposure are entered into in
order to hedge the fair value of a recognized asset, liability, or a firm commitment. Hedges of cash flow exposure are entered
into in order to hedge a forecasted transaction (e.g. forecasted revenue) or the variability of cash flows to be paid or received,
related to a recognized liability or asset (e.g. floating-rate debt).
The Company designates and assigns the derivatives as hedges of forecasted transactions, specific assets or specific
liabilities. When hedged assets or liabilities are sold or extinguished or the forecasted transactions being hedged occur or are no
longer expected to occur, the Company recognizes the gain or loss on the designated derivatives.

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 The Company’s hedge positions are measured at fair value on the balance sheet. Realized gains and losses from hedges
are classified in the income statement consistent with the accounting treatment of the items being hedged. The Company
accrues the differential for interest rate swaps to be paid or received under the agreements as interest rates change as
adjustments to interest expense over the lives of the swaps. Gains and losses on the termination of effective swap agreements,
prior to their original maturity, are deferred and amortized to interest expense over the remaining term of the underlying hedged
transactions.
The Company enters into derivatives that are not designated as hedges and do not qualify for hedge accounting. These
derivatives are intended to offset certain economic exposures of the Company and are carried at fair value with changes in value
recorded in earnings. Cash flows from hedging activities are classified in the Consolidated Statements of Cash Flows under the
same category as the cash flows from the related assets, liabilities or forecasted transactions (see Notes 8 and 17).
Income Taxes
Deferred income tax assets and liabilities are recorded with respect to temporary differences in the accounting treatment
of items for financial reporting purposes and for income tax purposes. Where, based on the weight of available evidence, it is
more likely than not that some amount of recorded deferred tax assets will not be realized, a valuation allowance is established
for the amount that, in management’s judgment, is sufficient to reduce the deferred tax asset to an amount that is more likely
than not to be realized.
A tax position must meet a minimum probability threshold before a financial statement benefit is recognized. The
minimum threshold is defined as a tax position that is more likely than not to be sustained upon examination by the applicable
taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position.
The tax benefit to be recognized is measured as the largest amount of benefit that is greater than fifty percent likely of being
realized upon ultimate settlement.
Redeemable Noncontrolling Interests
The Company consolidates the results of certain subsidiaries that are less than 100% owned and for which the
noncontrolling interest shareholders have the rights to require the Company to purchase their interests in these subsidiaries. The
most significant of these are Hulu LLC (Hulu) and BAMTech LLC (BAMTech).
Hulu provides DTC streaming services and is owned 67% by the Company and 33% by NBC Universal (NBCU). In May
2019, the Company entered into a put/call agreement with NBCU that provided the Company with full operational control of
Hulu. Under the agreement, beginning in January 2024, NBCU has the option to require the Company to purchase NBCU’s
interest in Hulu and the Company has the option to require NBCU to sell its interest in Hulu to the Company, in either case at a
redemption value based on NBCU’s equity ownership percentage of the greater of Hulu’s then equity fair value or a guaranteed
floor value of $27.5 billion.
NBCU’s interest will generally not be allocated its portion of Hulu’s losses, if any, as the redeemable noncontrolling
interest is required to be carried at a minimum value. The minimum value is equal to the fair value as of the May 2019
agreement date accreted to the January 2024 estimated redemption value. At October 1, 2022, NBCU’s interest in Hulu is
recorded in the Company’s financial statements at $8.7 billion.
BAMTech provides streaming technology services and is owned 85% by the Company and 15% by Major League
Baseball (MLB).
MLB has the right to sell its interest to the Company and the Company has the right to buy MLB’s interest starting five
years from and ending ten years after the Company’s September 25, 2017 acquisition date of BAMTech, in either case at a
redemption value based on MLB’s equity ownership percentage of the greater of BAMTech’s then equity fair value or a
guaranteed floor value ($563 million accreting at 8% annually for eight years from the date of acquisition).
The MLB interest is required to be carried at a minimum value equal to its acquisition date fair value accreted to its
estimated redemption value through the applicable redemption date. Therefore, the MLB interest is generally not allocated its
portion of BAMTech losses, if any. As of October 1, 2022, the MLB interest was recorded in the Company’s financial
statements at $828 million. In November 2022, the Company purchased MLB’s 15% interest for $900 million.
Our estimate of the redemption value of noncontrolling interests requires management to make significant judgments with
respect to the future value of the noncontrolling interests. We are accreting the noncontrolling interests of Hulu to its guaranteed
floor value. If our estimate of the future redemption value increased above the guaranteed floor value, we would change our rate
of accretion, which would generally increase the amount recorded in “Net income from continuing operations attributable to
noncontrolling interests and redeemable noncontrolling interests” and thus reduce “Net income (loss) attributable to The Walt
Disney Company (Disney)” on the Consolidated Statements of Operations.

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Earnings Per Share
The Company presents both basic and diluted earnings per share (EPS) amounts. Basic EPS is calculated by dividing net
income attributable to Disney by the weighted average number of common shares outstanding during the year. Diluted EPS is
based upon the weighted average number of common and common equivalent shares outstanding during the year, which is
calculated using the treasury-stock method for equity-based awards (Awards). Common equivalent shares are excluded from
the computation in periods for which they have an anti-dilutive effect. Stock options for which the exercise price exceeds the
average market price over the period are anti-dilutive and, accordingly, are excluded from the calculation.
A reconciliation of the weighted average number of common and common equivalent shares outstanding and the number
of Awards excluded from the diluted earnings per share calculation, as they were anti-dilutive, are as follows:
2022 2021 2020
Weighted average number of common and common equivalent
shares outstanding (basic) 1,822 1,816 1,808
Weighted average dilutive impact of Awards(1) 5 12 —
Weighted average number of common and common equivalent
shares outstanding (diluted) 1,827 1,828 1,808

Awards excluded from diluted earnings per share 15 4 35

(1)
Amounts exclude all potential common and common equivalent shares for periods when there is a net loss from
continuing operations.

3 Revenues
The following table presents our revenues by segment and major source:
2022 2021 2020
Content
License
Early
DMED DPEP Termination Total DMED DPEP Total DMED DPEP Total
Affiliate fees $ 17,525 $ — $ — $ 17,525 $ 17,760 $ — $ 17,760 $ 17,929 $ — $ 17,929
Subscription fees 15,291 — — 15,291 12,020 — 12,020 7,645 — 7,645
Advertising 13,044 4 — 13,048 12,425 4 12,429 10,851 4 10,855
Theme park admissions — 8,602 — 8,602 — 3,848 3,848 — 4,038 4,038
Resort and vacations — 6,410 — 6,410 — 2,701 2,701 — 3,402 3,402
Retail and wholesale sales of
merchandise, food and beverage — 7,838 — 7,838 — 4,957 4,957 — 4,952 4,952
Merchandise licensing — 3,969 — 3,969 12 3,586 3,598 32 3,210 3,242
TV/SVOD distribution licensing 4,452 — (1,023) 3,429 5,266 — 5,266 6,253 — 6,253
Theatrical distribution licensing 1,875 — — 1,875 920 — 920 2,134 — 2,134
Home entertainment 820 — — 820 1,014 — 1,014 1,802 — 1,802
Other 2,033 1,882 — 3,915 1,449 1,456 2,905 1,704 1,432 3,136
$ 55,040 $ 28,705 $ (1,023) $ 82,722 $ 50,866 $ 16,552 $ 67,418 $ 48,350 $ 17,038 $ 65,388

The following table presents our revenues by segment and primary geographical markets:
2022 2021 2020
DMED DPEP Total DMED DPEP Total DMED DPEP Total
Americas $ 45,018 $ 23,200 $ 68,218 $ 41,754 $ 12,403 $ 54,157 39,163 $ 12,829 $ 51,992
Europe 5,328 3,352 8,680 5,022 1,668 6,690 5,240 2,093 7,333
Asia Pacific 4,694 2,153 6,847 4,090 2,481 6,571 3,947 2,116 6,063
$ 55,040 $ 28,705 $ 83,745 $ 50,866 $ 16,552 $ 67,418 $ 48,350 $ 17,038 $ 65,388
Content License Early Termination (1,023)
$ 82,722

Revenues recognized in the current and prior year from performance obligations satisfied (or partially satisfied) in
previous reporting periods primarily relate to revenues earned on TV/SVOD licenses for titles made available to the licensee in
previous reporting periods. For fiscal 2022, $1.1 billion was recognized related to performance obligations satisfied prior to

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October 2, 2021. For fiscal 2021, $1.3 billion was recognized related to performance obligations satisfied prior to October 3,
2020. For fiscal 2020, $1.4 billion was recognized related to performance obligations satisfied prior to September 30, 2019.
As of October 1, 2022, revenue for unsatisfied performance obligations expected to be recognized in the future is $15
billion, which primarily relates to content and other IP to be delivered in the future under existing agreements with merchandise
and co-branding licensees and sponsors, television station affiliates, sports sublicensees, advertisers, and DTC wholesalers. Of
this amount, we expect to recognize approximately $6 billion in fiscal 2023, $4 billion in fiscal 2024, $2 billion in fiscal 2025
and $3 billion thereafter. These amounts include only fixed consideration or minimum guarantees and do not include amounts
related to (i) contracts with an original expected term of one year or less (such as most advertising contracts) or (ii) licenses of
IP that are solely based on the sales of the licensee.
When the timing of the Company’s revenue recognition is different from the timing of customer payments, the Company
recognizes either a contract asset (customer payment is subsequent to revenue recognition and subject to the Company
satisfying additional performance obligations) or deferred revenue (customer payment precedes the Company satisfying the
performance obligations). Consideration due under contracts with payment in arrears is recognized as accounts receivable.
Deferred revenues are recognized as (or when) the Company performs under the contract.
Contract assets, accounts receivable and deferred revenues from contracts with customers are as follows:

October 1, October 2,
2022 2021
Contract assets $ 32 $ 155
Accounts Receivable
Current 10,886 11,190
Non-current 1,226 1,359
Allowance for credit losses (179) (194)
Deferred revenues
Current 5,531 4,067
Non-current 927 581

Contract assets primarily relate to certain multi-season TV/SVOD licensing contracts. Activity for fiscal 2022 and 2021
related to contract assets was not material.
For fiscal 2022, 2021 and 2020, the Company recognized revenues of $3.6 billion, $2.9 billion and $3.4 billion,
respectively, that was included in the deferred revenue balance at October 2, 2021, October 3, 2020 and September 28, 2019,
respectively. Amounts deferred generally relate to DTC subscriptions, advances from merchandise licensees and TV/SVOD
licenses. In fiscal 2020, as a result of COVID-19, the Company had paid refunds for certain non-refundable deposits that were
reported as deferred revenue prior to fiscal 2020, the most significant of which related to park admission tickets and deposits for
vacation packages. The balance at October 2, 2021 related to these deposits was classified in “Accounts payable and other
accrued liabilities” in the Consolidated Balance Sheet. In fiscal 2022, the Company is no longer refunding these deposits and
approximately $1.5 billion is now classified as “Deferred revenue and other” in the Consolidated Balance Sheet.
The Company has accounts receivable with original maturities greater than one year related to the sale of film and
television program rights (TV/SVOD) and vacation club properties. These receivables are discounted to present value at
contract inception, and the related revenues are recognized at the discounted amount. The balance of TV/SVOD licensing
receivables recorded in other non-current assets was $0.6 billion and $0.8 billion at October 1, 2022 and October 2, 2021,
respectively. The balance of vacation club receivables recorded in other non-current assets was $0.6 billion at both October 1,
2022 and October 2, 2021, respectively. The allowance for credit losses and activity for fiscal 2022 and 2021 was not material.

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4 Other Income (Expense), Net
Other income (expense), net is as follows:
2022 2021 2020
DraftKings gain (loss) $ (663) $ (111) $ 973
fuboTV gain — 186 —
German FTA gain — 126 —
Endemol Shine gain — — 65
Other, net (4) — —
Other income (expense), net $ (667) $ 201 $ 1,038

In fiscal 2022 and 2021, the Company recognized a non-cash loss of $663 million and $111 million, respectively, from
the adjustment of its investment in DraftKings, Inc. (DraftKings) to fair value (DraftKings gain (loss)). In fiscal 2020, the
Company recognized a $973 million DraftKings gain.
In fiscal 2021, the Company recognized a $186 million gain from the sale of our investment in fuboTV Inc. (fuboTV
gain) and a $126 million gain on the sale of its 50% interest in a German free-to-air (FTA) television network (German FTA
gain).
In fiscal 2020, the Company recognized a $65 million gain on the sale of its 50% interest in Endemol Shine Group
(Endemol Shine gain).

5 Investments
Investments consist of the following:
October 1, October 2,
2022 2021
Investments, equity basis $ 2,678 $ 2,638
Investments, other 540 1,297
$ 3,218 $ 3,935

Investments, Equity Basis

The Company’s significant equity investments primarily consist of media investments and include A+E (50% ownership),
CTV Specialty Television, Inc. (30% ownership) and Tata Play Limited (30% ownership). As of October 1, 2022, the book
value of the Company’s equity method investments exceeded our share of the book value of the investees’ underlying net assets
by approximately $0.8 billion, which represents amortizable intangible assets and goodwill arising from acquisitions.
Investments, Other
As of October 1, 2022 and October 2, 2021, the Company had securities recorded at fair value of $0.3 billion and
$1.0 billion, respectively. As of October 1, 2022 and October 2, 2021, the Company had securities recorded at book value
related to non-publicly traded securities without a readily determinable fair value of $0.2 billion and $0.3 billion, respectively.
Gains, losses and impairments on securities are generally recorded in “Interest expense, net” in the Consolidated
Statements of Operations; these amounts were not material for fiscal 2022, 2021 and 2020. See Note 4 for realized and
unrealized gains and losses on securities recorded in “Other income (expense), net” in the Consolidated Statements of
Operations.

6 International Theme Parks

The Company has a 48% ownership interest in the operations of Hong Kong Disneyland Resort and a 43% ownership
interest in the operations of Shanghai Disney Resort (together, the Asia Theme Parks), which are both VIEs consolidated in the
Company’s financial statements. See Note 2 for the Company’s policy on consolidating VIEs. In addition, the Company has
100% ownership of Disneyland Paris. The Asia Theme Parks together with Disneyland Paris are collectively referred to as the
International Theme Parks.

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 The following table summarizes the carrying amounts of the Asia Theme Parks’ assets and liabilities included in the
Company’s Consolidated Balance Sheet:
October 1, October 2,
2022 2021
Cash and cash equivalents $ 280 $ 287
Other current assets 137 95
Total current assets 417 382
Parks, resorts and other property 6,356 6,928
Other assets 161 176
Total assets $ 6,934 $ 7,486

Current liabilities $ 468 $ 473

Long-term borrowings 1,426 1,331
Other long-term liabilities 395 422
Total liabilities $ 2,289 $ 2,226

The following table summarizes the International Theme Parks’ revenues and costs and expenses included in the
Company’s Consolidated Statements of Operations for fiscal 2022:
Revenues $ 3,026
Costs and expenses (3,459)
Equity in the loss of investees (10)

Asia Theme Parks’ royalty and management fees of $71 million for fiscal 2022 are eliminated in consolidation, but are
considered in calculating earnings attributable to noncontrolling interests.
International Theme Parks’ cash flows included in the Company’s fiscal 2022 Consolidated Statements of Cash Flows
were $407 million provided by operating activities, $752 million used in investing activities and $240 million provided by
financing activities.
Hong Kong Disneyland Resort
The Government of the Hong Kong Special Administrative Region (HKSAR) and the Company have a 52% and a 48%
equity interest in Hong Kong Disneyland Resort, respectively.
The Company and HKSAR have provided loans to Hong Kong Disneyland Resort with outstanding balances of $152
million and $102 million, respectively. The interest rate on both loans is three month HIBOR plus 2%, and the maturity date is
September 2025. The Company’s loan is eliminated in consolidation.
The Company has provided Hong Kong Disneyland Resort with a revolving credit facility of HK $2.1 billion ($268
million), which bears interest at a rate of three month HIBOR plus 1.25% and matures in December 2023. The outstanding
balance under the line of credit at October 1, 2022 was $231 million. The Company’s line of credit is eliminated in
consolidation.
Hong Kong Disneyland Resort is undergoing a multi-year expansion estimated to cost HK $10.9 billion ($1.4 billion).
The Company and HKSAR have agreed to fund the expansion on an equal basis through equity contributions, which totaled
$148 million and $42 million in fiscal 2022 and 2021, respectively. To date, the Company and HKSAR have funded a total of
$716 million.
HKSAR has the right to receive additional shares over time to the extent Hong Kong Disneyland Resort exceeds certain
return on asset performance targets. The amount of additional shares HKSAR can receive is capped on an annual basis and
could decrease the Company’s equity interest by up to an additional 6 percentage points over a period no shorter than 10 years.
Assuming HK $10.9 billion is contributed in the expansion, the impact to the Company’s equity interest would be limited to 5
percentage points.
Shanghai Disney Resort
Shanghai Shendi (Group) Co., Ltd (Shendi) and the Company have 57% and 43% equity interests in Shanghai Disney
Resort, respectively. A management company, in which the Company has a 70% interest and Shendi a 30% interest, operates
Shanghai Disney Resort.

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 The Company has provided Shanghai Disney Resort with loans totaling $930 million, bearing interest at rates up to 8%
and maturing in 2036, with early repayment permitted. The Company has also provided Shanghai Disney Resort with a
1.9 billion yuan (approximately $0.3 billion) line of credit bearing interest at 8%. As of October 1, 2022, the total amount
outstanding under the line of credit was 0.9 billion yuan (approximately $123 million). These balances are eliminated in
consolidation.
Shendi has provided Shanghai Disney Resort with loans totaling 8.3 billion yuan (approximately $1.2 billion), bearing
interest at rates up to 8% and maturing in 2036, with early repayment permitted. Shendi has also provided Shanghai Disney
Resort with a 2.6 billion yuan (approximately $0.4 billion) line of credit bearing interest at 8%. As of October 1, 2022, the total
amount outstanding under the line of credit was 1.2 billion yuan (approximately $162 million).

7 Produced and Acquired/Licensed Content Costs and Advances

Total capitalized produced and licensed content by predominant monetization strategy is as follows:
As of October 1, 2022 As of October 2, 2021
Predominantly Predominantly Predominantly Predominantly
Monetized Monetized Monetized Monetized
Individually as a Group Total Individually as a Group Total
Produced content
Released, less amortization $ 4,639 $ 12,688 $ 17,327 $ 4,944 $ 9,779 $ 14,723
Completed, not released 214 2,019 2,233 630 762 1,392
In-process 5,041 6,793 11,834 4,371 4,623 8,994
In development or pre-production 372 254 626 351 162 513
$ 10,266 $ 21,754 32,020 $ 10,296 $ 15,326 25,622
Licensed content - Television
Programming rights and advances 5,647 6,110
Total produced and licensed content $ 37,667 $ 31,732

Current portion $ 1,890 $ 2,183

Non-current portion $ 35,777 $ 29,549

Amortization of produced and licensed content is as follows:

2022 2021 2020
Produced content
Predominantly monetized individually $ 3,448 $ 2,947 $ 4,305
Predominantly monetized as a group 6,776 5,228 5,032
10,224 8,175 9,337
Licensed programming rights and advances 13,432 12,784 11,241
Total produced and licensed content costs(1) $ 23,656 $ 20,959 $ 20,578
(1)
Primarily included in “Costs of services” in the Consolidated Statements of Operations.

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 Total expected amortization by fiscal year of completed (released and not released) produced, licensed and acquired film
and television library content on the balance sheet as of October 1, 2022 is as follows:
Predominantly Predominantly
Monetized Monetized
Individually as a Group Total
Produced content
Released
2023 $ 1,158 $ 2,906 $ 4,064
2024 674 2,002 2,676
2025 524 1,636 2,160
Completed, not released
2023 91 778 869

Licensed content - Programming rights and advances

2023 $ 3,228
2024 1,069
2025 534

Approximately $2.2 billion of accrued participations and residual liabilities will be paid in fiscal 2023.
At October 1, 2022, acquired film and television library content has remaining unamortized costs of $3.3 billion, which
are generally being amortized straight-line over a weighted-average remaining period of approximately 16 years.

8 Borrowings
The Company’s borrowings, including the impact of interest rate and cross-currency swaps, are summarized as follows:
October 1, 2022
Pay Floating
Interest rate
Stated and Cross- Effective
Oct. 1, Oct. 2, Interest Currency Interest Swap
2022 2021 Rate(1) Swaps(2) Rate(3) Maturities
Commercial paper $ 1,662 $ 1,992 — $ — 3.31%
U.S. dollar denominated notes(4) 45,091 49,090 4.03% 12,625 4.07% 2023-2031
Foreign currency denominated debt 1,844 2,011 2.92% 1,847 3.42% 2025-2027
Other(5) (1,653) (18) —
46,944 53,075 3.85% 14,472 4.02%
Asia Theme Parks borrowings 1,425 1,331 2.35% — 6.11%
Total borrowings 48,369 54,406 3.94% 14,472 4.08%
Less current portion 3,070 5,866 3.65% 1,000 3.85%
Total long-term borrowings $ 45,299 $ 48,540 $ 13,472
(1)
The stated interest rate represents the weighted-average coupon rate for each category of borrowings. For floating-rate
borrowings, interest rates are the rates in effect at October 1, 2022; these rates are not necessarily an indication of
future interest rates.
(2)
Amounts represent notional values of interest rate and cross-currency swaps outstanding as of October 1, 2022.
(3)
The effective interest rate includes the impact of existing and terminated interest rate and cross-currency swaps,
purchase accounting adjustments and debt issuance premiums, discounts and costs.
(4)
Includes net debt issuance discounts, costs and purchase accounting adjustments totaling a net premium of $1.9 billion
and $2.1 billion at October 1, 2022 and October 2, 2021, respectively.
(5)
Includes market value adjustments for debt with qualifying hedges, which reduces borrowings by $1.7 billion and $0.1
billion at October 1, 2022 and October 2, 2021, respectively.

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Commercial Paper
At October 1, 2022, the Company’s bank facilities, which are with a syndicate of lenders and support our commercial
paper borrowings, were as follows:
Committed Capacity Unused
Capacity Used Capacity
Facility expiring March 2023 $ 5,250 $ — $ 5,250
Facility expiring March 2025 3,000 — 3,000
Facility expiring March 2027 4,000 — 4,000
Total $ 12,250 $ — $ 12,250

These facilities allow for borrowings at SOFR-based rates plus a fixed spread that varies with the Company’s debt ratings
assigned by Moody’s Investors Service and Standard & Poor’s ranging from 0.755% to 1.225%. The bank facilities contain
only one financial covenant, relating to interest coverage of three times earnings before interest, taxes, depreciation and
amortization, including both intangible amortization and amortization of our film and television production and programming
costs. On October 1, 2022, the Company met this covenant by a significant margin. The bank facilities specifically exclude
certain entities, including the Asia Theme Parks, from any representations, covenants or events of default. The Company also
has the ability to issue up to $500 million of letters of credit under the facility expiring in March 2027, which if utilized,
reduces available borrowings under this facility. As of October 1, 2022, the Company has $1.9 billion of outstanding letters of
credit, of which none were issued under this facility.
Commercial paper activity is as follows:
Commercial Commercial
paper with paper with
original original
maturities less maturities
than three greater than
months, net(1) three months Total
Balance at Oct. 3, 2020 $ — $ 2,023 $ 2,023
Additions — 2,221 2,221
Payments — (2,247) (2,247)
Other Activity — (5) (5)
Balance at Oct. 2, 2021 $ — $ 1,992 $ 1,992
Additions 50 2,417 2,467
Payments — (2,801) (2,801)
Other Activity — 4 4
Balance at Oct. 1, 2022 $ 50 $ 1,612 $ 1,662
(1)
Borrowings and reductions of borrowings are reported net.
U.S. Dollar Denominated Notes
At October 1, 2022, the Company had $45.1 billion of fixed rate U.S. dollar denominated notes with maturities ranging
from 1 to 74 years and stated interest rates that range from 1.75% to 9.50%.
Foreign Currency Denominated Debt
Prior to fiscal 2020, the Company issued Canadian $1.3 billion ($0.9 billion) of fixed rate senior notes, which bear interest
at 2.76% and mature in October 2024. The Company also entered into pay-floating interest rate and cross currency swaps that
effectively convert the borrowing to a variable-rate U.S. dollar denominated borrowing indexed to LIBOR.
In fiscal 2020, the Company issued Canadian $1.3 billion ($0.9 billion) of fixed rate senior notes, which bear interest at
3.057% and mature in March 2027. The Company also entered into pay-floating interest rate and cross currency swaps that
effectively convert the borrowing to a variable-rate U.S. dollar denominated borrowing indexed to LIBOR.
Cruise Ship Credit Facilities
The Company has credit facilities to finance up to 80% of the contract price of two new cruise ships, which are scheduled
to be delivered in fiscal 2025 and fiscal 2026. Under the facilities, $1.1 billion is available beginning in August 2023 and $1.1
billion is available beginning in August 2024. Each tranche of financing may be utilized for a period of 18 months from the
initial availability date. If utilized, the interest rates will be fixed at 3.80% and 3.74%, respectively, and the loan and interest

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will be payable semi-annually over a 12-year period from the borrowing date. Early repayment is permitted subject to
cancellation fees.
Asia Theme Parks Borrowings
HKSAR provided Hong Kong Disneyland Resort with loans totaling HK $0.8 billion ($102 million). The interest rate is
three month HIBOR plus 2%, and the maturity date is September 2025.
Shendi has provided Shanghai Disney Resort with loans totaling 8.3 billion yuan (approximately $1.2 billion) bearing
interest at rates up to 8% and maturing in 2036, with early repayment permitted. Shendi has also provided Shanghai Disney
Resort with a 2.6 billion yuan (approximately $0.4 billion) line of credit bearing interest at 8%. As of October 1, 2022 the total
amount outstanding under the line of credit was 1.2 billion yuan (approximately $162 million).
Maturities
The following table provides total borrowings, excluding market value adjustments and debt issuance premiums,
discounts and costs, by scheduled maturity date as of October 1, 2022. The table also provides the estimated interest payments
on these borrowings as of October 1, 2022 although actual future payments will differ for floating-rate borrowings:

Borrowings
Before
Asia Total
Theme Parks Asia Total Borrowings and
Fiscal Year: Consolidation Theme Parks Borrowings Interest(1) Interest
2023 $ 2,918 $ 162 $ 3,080 $ 1,811 $ 4,891
2024 2,872 — 2,872 1,748 4,620
2025 3,604 102 3,706 1,631 5,337
2026 4,578 — 4,578 1,533 6,111
2027 2,905 — 2,905 1,428 4,333
Thereafter 29,881 1,161 31,042 19,738 50,780
$ 46,758 $ 1,425 $ 48,183 $ 27,889 $ 76,072
(1)
In 2023, the Company has the ability to call a debt instrument prior to its scheduled maturity, which if exercised by the
Company would reduce future interest payments by $1.1 billion.
Interest
The Company capitalizes interest on assets constructed for its parks and resorts and on certain film and television
productions. In fiscal 2022, 2021 and 2020, total interest capitalized was $261 million, $187 million and $157 million,
respectively. Interest expense, net of capitalized interest, for fiscal 2022, 2021 and 2020 was $1,549 million, $1,546 million and
$1,647 million, respectively.

9 Income Taxes
Income (Loss) Before Income Taxes by Domestic and Foreign Subsidiaries
2022 2021 2020
Income (Loss) Before Income Taxes
Domestic subsidiaries (including U.S. exports) $ 5,955 $ 5,241 $ 4,706
Foreign subsidiaries(1) (670) (2,680) (6,449)
Total income (loss) from continuing operations 5,285 2,561 (1,743)
Loss from discontinued operations (62) (38) (42)
$ 5,223 $ 2,523 $ (1,785)
(1)
Includes goodwill and intangible asset impairment in fiscal 2020.

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Provision for Income Taxes: Current and Deferred
Income Tax Expense (Benefit)
Current 2022 2021 2020
Federal $ 436 $ 594 $ 95
State 282 129 148
Foreign(1) 846 554 731
1,564 1,277 974
Deferred
Federal 407 (526) 279
State 26 (220) (29)
Foreign (265) (506) (525)
168 (1,252) (275)
Income tax expense from continuing operations 1,732 25 699
Income tax expense from discontinued operations (14) (9) (10)
$ 1,718 $ 16 $ 689
(1)
Includes foreign withholding taxes.
Deferred Tax Assets and Liabilities
October 1, October 2,
2022 2021
Components of Deferred Tax (Assets) and Liabilities
Deferred tax assets
Net operating losses and tax credit carryforwards(1) $ (3,527) $ (3,944)
Accrued liabilities (1,570) (2,544)
Lease liabilities (748) (764)
Licensing revenues (124) (80)
Other (819) (725)
Total deferred tax assets (6,788) (8,057)
Deferred tax liabilities
Depreciable, amortizable and other property 8,575 7,916
Investment in U.S. entities 1,798 2,653
Right-of-use assets 676 697
Investment in foreign entities 543 392
Other 64 164
Total deferred tax liabilities 11,656 11,822
Net deferred tax liability before valuation allowance 4,868 3,765
Valuation allowance 2,859 2,795
Net deferred tax liability $ 7,727 $ 6,560
(1)
Balances as of October 1, 2022 and October 2, 2021 include approximately $1.5 billion and $1.6 billion, respectively,
of International Theme Park net operating losses and approximately $1.0 billion at both October 1, 2022 and
October 2, 2021 of foreign tax credits in the U.S. The International Theme Park net operating losses are primarily in
France and, to a lesser extent, Hong Kong and China. Losses in France and Hong Kong have an indefinite
carryforward period and losses in China have a five-year carryforward period. China theme park net operating losses
of $0.2 billion may expire between fiscal 2023 and fiscal 2028. Foreign tax credits in the U.S. have a ten-year
carryforward period. Foreign tax credits of $1.0 billion may expire beginning fiscal 2026.

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 The following table details the change in valuation allowance for fiscal 2022, 2021 and 2020 (in billions):
Balance at
Beginning of Charges to Tax Balance at End
Period Expense Other Changes of Period
Year ended October 1, 2022 $ 2.8 $ 0.4 $ (0.3) $ 2.9
Year ended October 2, 2021 2.4 0.4 — 2.8
Year ended October 3, 2020 1.9 0.6 (0.1) 2.4

Reconciliation of the effective income tax rate for continuing operations to the federal rate
2022 2021 2020(1)
Federal income tax rate 21.0 % 21.0 % 21.0 %
State taxes, net of federal benefit 3.1 1.9 4.3
Tax rate differential on foreign income 4.3 12.0 (16.5)
Foreign derived intangible income (3.4) (6.4) —
Excess tax benefits from equity awards — (5.3) 3.7
Legislative changes 1.7 (12.2) 4.4
Income tax audits and reserves 2.7 (4.8) (6.1)
Goodwill impairment — — (41.1)
Valuation allowance 4.5 2.6 (14.6)
Other (1.1) (7.8) 4.8
32.8 % 1.0 % (40.1 %)
(1)
In fiscal 2020, the Company had a pre-tax loss. Positive amounts reflect tax benefits, whereas negative amounts reflect
tax expense.
The effective income tax rate in fiscal 2022 was higher than the U.S. statutory rate primarily due to higher effective tax
rates on foreign earnings. The effective income tax rate in fiscal 2021 was lower than the U.S. statutory rate due to favorable
adjustments related to prior years and excess tax benefits on employee share-based awards, partially offset by higher effective
tax rates on foreign earnings. The effective income tax rate in fiscal 2020 included an unfavorable impact of the goodwill
impairment, which was not tax deductible, and the impact of higher effective tax rates on foreign earnings than the U.S.
statutory rate. Higher effective tax rates on foreign earnings in fiscal 2022, 2021 and 2020 reflected the impact of foreign losses
and, to a lesser extent, foreign tax credits for which we are unable to recognize a tax benefit.
Unrecognized tax benefits
A reconciliation of the beginning and ending amount of gross unrecognized tax benefits, excluding the related accrual for
interest, is as follows:
2022 2021 2020
Balance at the beginning of the year $ 2,641 $ 2,740 $ 2,952
Increases for current year tax positions 48 51 26
Increases for prior year tax positions 103 556 168
Decreases in prior year tax positions (108) (174) (99)
Settlements with taxing authorities (235) (532) (307)
Balance at the end of the year $ 2,449 $ 2,641 $ 2,740

The fiscal year-end 2022, 2021 and 2020 balances include $1.9 billion, $2.0 billion and $2.1 billion, respectively, that if
recognized, would reduce our income tax expense and effective tax rate. These amounts are net of the offsetting benefits from
other tax jurisdictions.
At October 1, 2022, October 2, 2021 and October 3, 2020, the Company had $1.0 billion, $1.0 billion and $1.1 billion,
respectively, in accrued interest and penalties related to unrecognized tax benefits. During fiscal 2022, 2021 and 2020, the
Company recorded additional interest and penalties of $157 million, $191 million and $211 million, respectively, and recorded
reductions in accrued interest and penalties of $119 million, $256 million and $101 million, respectively, as a result of audit
settlements and other prior-year adjustments. The Company’s policy is to report interest and penalties as a component of
income tax expense.

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 The Company is generally no longer subject to U.S. federal examination for years prior to 2018. The Company is no
longer subject to examination in any of its major state or foreign tax jurisdictions for years prior to 2008.
In the next twelve months, it is reasonably possible that our unrecognized tax benefits could change due to the resolution
of open tax matters, which would reduce our unrecognized tax benefits by $0.1 billion.
Other
In fiscal 2022, 2021 and 2020, the Company recognized income tax benefits of $2 million, $135 million and $64 million,
respectively for the excess of equity-based compensation deductions over amounts recorded based on the grant date fair value.

10 Pension and Other Benefit Programs

The Company maintains pension and postretirement medical benefit plans covering certain of its employees not covered
by union or industry-wide plans. The Company has defined benefit pension plans that cover employees hired prior to January 1,
2012. For employees hired after this date, the Company has a defined contribution plan. Benefits under these pension plans are
generally based on years of service and/or compensation and generally require 3 years of vesting service. Employees generally
hired after January 1, 1987 for certain of our media businesses and other employees generally hired after January 1, 1994 are
not eligible for postretirement medical benefits. In addition, the Company has a defined benefit plan for TFCF employees for
which benefits stopped accruing in June 2017.
Defined Benefit Plans
The Company measures the actuarial value of its benefit obligations and plan assets for its defined benefit pension and
postretirement medical benefit plans at September 30 and adjusts for any plan contributions or significant events between
September 30 and our fiscal year end.
The following chart summarizes the benefit obligations, assets, funded status and balance sheet impacts associated with
the defined benefit pension and postretirement medical benefit plans:
Pension Plans Postretirement Medical Plans
October 1, October 2, October 1, October 2,
2022 2021 2022 2021
Projected benefit obligations
Beginning obligations $ (20,955) $ (20,760) $ (2,121) $ (2,104)
Service cost (400) (434) (9) (10)
Interest cost (500) (457) (51) (47)
Actuarial gain (loss)(1) 6,159 15 595 (13)
Plan amendments and other 39 20 (16) (14)
Benefits paid 629 661 63 67
Ending obligations $ (15,028) $ (20,955) $ (1,539) $ (2,121)
Fair value of plans’ assets
Beginning fair value $ 18,076 $ 15,598 $ 889 $ 771
Actual return on plan assets (2,715) 2,653 (134) 137
Contributions 96 565 61 47
Benefits paid (629) (661) (63) (67)
Expenses and other (107) (79) (4) 1
Ending fair value $ 14,721 $ 18,076 $ 749 $ 889

Underfunded status of the plans $ (307) $ (2,879) $ (790) $ (1,232)

Amounts recognized in the balance sheet

Non-current assets $ 913 $ 88 $ — $ —
Current liabilities (66) (63) (4) (4)
Non-current liabilities (1,154) (2,904) (786) (1,228)
$ (307) $ (2,879) $ (790) $ (1,232)
(1)
The actuarial gain for fiscal 2022 was due to an increase in the discount rate used to determine the fiscal year-end
benefit obligation from the rate that was used in the preceding fiscal year.

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 The components of net periodic benefit cost are as follows:
Pension Plans Postretirement Medical Plans
2022 2021 2020 2022 2021 2020
Service cost $ 400 $ 434 $ 410 $ 9 $ 10 $ 10
Other costs (benefits):
Interest cost 500 457 527 51 47 56
Expected return on plan assets (1,174) (1,100) (1,084) (59) (55) (57)
Amortization of prior-year service
costs 7 11 13 — — —
Recognized net actuarial loss 585 777 544 28 30 14
Total other costs (benefits) (82) 145 — 20 22 13
Net periodic benefit cost $ 318 $ 579 $ 410 $ 29 $ 32 $ 23

In fiscal 2023, we expect pension and postretirement medical costs to decrease by $428 million to a net benefit of $81
million primarily due to lower amortization of previously deferred losses, partially offset by higher interest costs.

Key assumptions are as follows:

Pension Plans Postretirement Medical Plans
2022 2021 2020 2022 2021 2020
Discount rate used to determine the
fiscal year-end benefit obligation 5.44% 2.88% 2.82% 5.47% 2.89% 2.80%
Discount rate used to determine the
interest cost component of net
periodic benefit cost 2.45% 2.28% 2.94% 2.47% 2.28% 2.95%
Rate of return on plan assets 7.00% 7.00% 7.00% 7.00% 7.00% 7.00%
Weighted average rate of compensation
increase to determine the fiscal
year-end benefit obligation 3.10% 3.10% 3.20% n/a n/a n/a
Year 1 increase in cost of benefits n/a n/a n/a 7.00% 7.00% 7.00%
Rate of increase to which the cost of
benefits is assumed to decline (the
ultimate trend rate) n/a n/a n/a 4.00% 4.00% 4.25%
Year that the rate reaches the ultimate
trend rate n/a n/a n/a 2041 2040 2034

AOCI, before tax, as of October 1, 2022 consists of the following amounts that have not yet been recognized in net
periodic benefit cost:
Postretirement
Pension Plans Medical Plans Total
Prior service cost $ 26 $ — $ 26
Net actuarial loss 3,838 (93) 3,745
Total amounts included in AOCI 3,864 (93) 3,771
Prepaid (accrued) pension cost (3,557) 883 (2,674)
Net balance sheet liability $ 307 $ 790 $ 1,097

Plan Funded Status

As of October 1, 2022, the projected benefit obligation and accumulated benefit obligation for pension plans with
accumulated benefit obligations in excess of plan assets were $1.2 billion and $1.1 billion, respectively, and the aggregate fair
value of plan assets were not material. As of October 2, 2021, the projected benefit obligation, accumulated benefit obligation
and aggregate fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were $9.0
billion, $8.5 billion and $6.9 billion, respectively.
As of October 1, 2022, the projected benefit obligation for pension plans with projected benefit obligations in excess of
plan assets was $1.2 billion and the aggregate fair value of plan assets was not material. As of October 2, 2021, the projected

96
benefit obligation and aggregate fair value of plan assets for pension plans with projected benefit obligations in excess of plan
assets were $19.9 billion and $16.9 billion respectively.
The Company’s total accumulated pension benefit obligations at October 1, 2022 and October 2, 2021 were $14.1 billion
and $19.4 billion, respectively. Approximately 98% was vested as of both October 1, 2022 and October 2, 2021.
The accumulated postretirement medical benefit obligations and fair value of plan assets for postretirement medical plans
with accumulated postretirement medical benefit obligations in excess of plan assets were $1.5 billion and $0.7 billion,
respectively, at October 1, 2022 and $2.1 billion and $0.9 billion, respectively, at October 2, 2021.
Plan Assets
A significant portion of the assets of the Company’s defined benefit plans are managed in a third-party master trust. The
investment policy and allocation of the assets in the master trust were approved by the Company’s Investment and
Administrative Committee, which has oversight responsibility for the Company’s retirement plans. The investment policy
ranges for the major asset classes are as follows:
Asset Class Minimum Maximum
Equity investments 30% 60%
Fixed income investments 20% 40%
Alternative investments 10% 30%
Cash & money market funds —% 10%

The primary investment objective for the assets within the master trust is the prudent and cost effective management of
assets to satisfy benefit obligations to plan participants. Financial risks are managed through diversification of plan assets,
selection of investment managers and through the investment guidelines incorporated in investment management agreements.
Investments are monitored to assess whether returns are commensurate with risks taken.
The long-term asset allocation policy for the master trust was established taking into consideration a variety of factors that
include, but are not limited to, the average age of participants, the number of retirees, the duration of liabilities and the expected
payout ratio. Liquidity needs of the master trust are generally managed using cash generated by investments or by liquidating
securities.
Assets are generally managed by external investment managers pursuant to investment management agreements that
establish permitted securities and risk controls commensurate with the account’s investment strategy. Some agreements permit
the use of derivative securities (futures, options, interest rate swaps, credit default swaps) that enable investment managers to
enhance returns and manage exposures within their accounts.
Fair Value Measurements of Plan Assets
Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly
transaction between market participants and is generally classified in one of the following categories of the fair value hierarchy:
Level 1 – Quoted prices for identical instruments in active markets
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in
markets that are not active; and model-derived valuations in which all significant inputs and significant value
drivers are observable in active markets
Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value
drivers are unobservable
Investments that are valued using the net asset value (NAV) (or its equivalent) practical expedient are excluded from the
fair value hierarchy disclosure.
The following is a description of the valuation methodologies used for assets reported at fair value. The methodologies
used at October 1, 2022 and October 2, 2021 are the same.
Level 1 investments are valued based on reported market prices on the last trading day of the fiscal year. Investments in
common and preferred stocks and mutual funds are valued based on the securities’ exchange-listed price or a broker’s quote in
an active market. Investments in U.S. Treasury securities are valued based on a broker’s quote in an active market.
Level 2 investments in government and federal agency bonds and notes (excluding U.S. Treasury securities), corporate
bonds, mortgage-backed securities (MBS) and asset-backed securities are valued using a broker’s quote in a non-active market
or an evaluated price based on a compilation of reported market information, such as benchmark yield curves, credit spreads
and estimated default rates. Derivative financial instruments are valued based on models that incorporate observable inputs for
the underlying securities, such as interest rates or foreign currency exchange rates.

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 The Company’s defined benefit plan assets are summarized by level in the following tables:
As of October 1, 2022
Description Level 1 Level 2 Total Plan Asset Mix
Cash $ 177 $ — $ 177 1%
Common and preferred stocks(1) 3,118 — 3,118 20%
Mutual funds 1,044 — 1,044 7%
Government and federal agency bonds, notes 2,061 293 2,354 15%
and MBS
Corporate bonds — 751 751 5%
Other mortgage- and asset-backed securities — 84 84 1%
Derivatives and other, net 2 13 15 —%
Total investments in the fair value hierarchy $ 6,402 $ 1,141 $ 7,543
Assets valued at NAV as a practical expedient:
Common collective funds 3,479 22%
Alternative investments 4,208 27%
Money market funds and other 240 2%
Total investments at fair value $ 15,470 100%
As of October 2, 2021
Description Level 1 Level 2 Total Plan Asset Mix
Cash $ 77 $ — $ 77 —%
Common and preferred stocks(1) 4,407 — 4,407 23%
Mutual funds 1,326 — 1,326 7%
Government and federal agency bonds, notes 2,437 349 2,786 15%
and MBS
Corporate bonds — 1,098 1,098 6%
Other mortgage- and asset-backed securities — 96 96 1%
Derivatives and other, net 8 21 29 —%
Total investments in the fair value hierarchy $ 8,255 $ 1,564 $ 9,819
Assets valued at NAV as a practical expedient:
Common collective funds 4,550 24%
Alternative investments 4,342 23%
Money market funds and other 254 1%
Total investments at fair value $ 18,965 100%
(1)
Includes 2.9 million shares of Company common stock valued at $273 million (2% of total plan assets) and 2.9 million
shares valued at $489 million (3% of total plan assets) at October 1, 2022 and October 2, 2021, respectively.
Uncalled Capital Commitments
Alternative investments held by the master trust include interests in funds that have rights to make capital calls to the
investors. In such cases, the master trust would be contractually obligated to make a cash contribution at the time of the capital
call. At October 1, 2022, the total committed capital still uncalled and unpaid was $1.5 billion.
Plan Contributions
During fiscal 2022, the Company made $157 million of contributions to its pension and postretirement medical plans. The
Company currently does not expect to make material pension and postretirement medical plan contributions in fiscal 2023.
Final minimum funding requirements for fiscal 2023 will be determined based on a January 1, 2023 funding actuarial valuation,
which is expected to be received during the fourth quarter of fiscal 2023.

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Estimated Future Benefit Payments
The following table presents estimated future benefit payments for the next ten fiscal years:
Pension Postretirement
Plans Medical Plans(1)
2023 $ 720 $ 65
2024 727 69
2025 771 73
2026 815 78
2027 858 83
2028 – 2032 4,874 479
(1)
Estimated future benefit payments are net of expected Medicare subsidy receipts of $81 million.
Assumptions
Assumptions, such as discount rates, long-term rate of return on plan assets and the healthcare cost trend rate, have a
significant effect on the amounts reported for net periodic benefit cost as well as the related benefit obligations.
Discount Rate — The assumed discount rate for pension and postretirement medical plans reflects the market rates for
high-quality corporate bonds currently available. The Company’s discount rate was determined by considering yield curves
constructed of a large population of high-quality corporate bonds and reflects the matching of the plans’ liability cash flows to
the yield curves. The Company measures service and interest costs by applying the specific spot rates along that yield curve to
the plans’ liability cash flows.
Long-term rate of return on plan assets — The long-term rate of return on plan assets represents an estimate of long-term
returns on an investment portfolio consisting of a mixture of equities, fixed income and alternative investments. When
determining the long-term rate of return on plan assets, the Company considers long-term rates of return on the asset classes
(both historical and forecasted) in which the Company expects the pension funds to be invested. The following long-term rates
of return by asset class were considered in setting the long-term rate of return on plan assets assumption:
Equity Securities 6% to 10%
Debt Securities 2% to 5%
Alternative Investments 6% to 11%

Healthcare cost trend rate — The Company reviews external data and its own historical trends for healthcare costs to
determine the healthcare cost trend rates for the postretirement medical benefit plans. The 2022 actuarial valuation assumed a
7.00% annual rate of increase in the per capita cost of covered healthcare claims with the rate decreasing in even increments
over nineteen years until reaching 4.00%.
Sensitivity — A one percentage point change in the discount rate and expected long-term rate of return on plan assets
would have the following effects on the projected benefit obligations for pension and postretirement medical plans as of
October 1, 2022 and on cost for fiscal 2023:
Expected Long-Term
Discount Rate Rate of Return On Assets
Benefit Projected Benefit Benefit
Increase (decrease) Expense Obligations Expense
1 percentage point decrease $ 242 $ 2,342 $ 172
1 percentage point increase (59) (2,045) (172)

Multiemployer Benefit Plans

The Company participates in a number of multiemployer pension plans under union and industry-wide collective
bargaining agreements that cover our union-represented employees and expenses its contributions to these plans as incurred.
These plans generally provide for retirement, death and/or termination benefits for eligible employees within the applicable
collective bargaining units, based on specific eligibility/participation requirements, vesting periods and benefit formulas. The
risks of participating in these multiemployer plans are different from single-employer plans. For example:
• Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other
participating employers.

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 • If a participating employer stops contributing to the multiemployer plan, the unfunded obligations of the plan may
become the obligation of the remaining participating employers.
• If a participating employer chooses to stop participating in these multiemployer plans, the employer may be required to
pay those plans an amount based on the underfunded status of the plan.
The Company also participates in several multiemployer health and welfare plans that cover both active and retired
employees. Health care benefits are provided to participants who meet certain eligibility requirements under the applicable
collective bargaining unit.
The following table sets forth our contributions to multiemployer pension and health and welfare benefit plans:
2022 2021 2020
Pension plans $ 402 $ 289 $ 221
Health & welfare plans 401 272 217
Total contributions $ 803 $ 561 $ 438

Defined Contribution Plans

The Company has defined contribution retirement plans for domestic employees who began service after December 31,
2011 and are not eligible to participate in the defined benefit pension plans. In general, the Company contributes from 4% to
10% of an employee’s compensation depending on the employee’s age and years of service with the Company up to plan limits.
The Company has savings and investment plans that allow eligible employees to contribute up to 50% of their salary through
payroll deductions depending on the plan in which the employee participates. The Company matches 50% of the employee’s
contribution up to plan limits. The Company also has defined contribution retirement plans for employees in our international
operations. In fiscal 2022, 2021 and 2020, the costs of our domestic and international defined contribution plans were $325
million, $254 million and $242 million, respectively.

11 Equity
The Company paid the following dividend in fiscal 2020:
Per Share Total Paid Payment Timing Related to Fiscal Period
$0.88 $1.6 billion Second Quarter of Fiscal 2020 Second Half 2019

The Company did not pay a dividend with respect to fiscal year 2021 and 2020 operations and has not declared or paid a
dividend with respect to fiscal 2022 operations.
The following table summarizes the changes in each component of accumulated other comprehensive income (loss)
(AOCI) including our proportional share of equity method investee amounts:
Unrecognized
Pension and Foreign
Market Value Postretirement Currency
Adjustments Medical Translation
for Hedges Expense and Other AOCI
AOCI, before tax
Balance at September 28, 2019 $ 129 $ (7,502) $ (1,086) $ (8,459)
Unrealized gains (losses) arising during the period (57) (2,468) (2) (2,527)
Reclassifications of net (gains) losses to net income (263) 547 — 284
Balance at October 3, 2020 $ (191) $ (9,423) $ (1,088) $ (10,702)
Unrealized gains (losses) arising during the period 70 1,582 41 1,693
Reclassifications of net (gains) losses to net income (31) 816 — 785
Balance at October 2, 2021 $ (152) $ (7,025) $ (1,047) $ (8,224)
Unrealized gains (losses) arising during the period 1,098 2,635 (967) 2,766
Reclassifications of net (gains) losses to net income (142) 620 — 478
Balance at October 1, 2022 $ 804 $ (3,770) $ (2,014) $ (4,980)

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 Unrecognized
Pension and Foreign
Market Value Postretirement Currency
Adjustments Medical Translation
for Hedges Expense and Other AOCI
Tax on AOCI
Balance at September 28, 2019 $ (29) $ 1,756 $ 115 $ 1,842
Unrealized gains (losses) arising during the period 8 572 24 604
Reclassifications of net (gains) losses to net income 61 (127) — (66)
Balance at October 3, 2020 $ 40 $ 2,201 $ 139 $ 2,380
Unrealized gains (losses) arising during the period (8) (358) (50) (416)
Reclassifications of net (gains) losses to net income 10 (190) — (180)
Balance at October 2, 2021 $ 42 $ 1,653 $ 89 $ 1,784
Unrealized gains (losses) arising during the period (254) (608) 50 (812)
Reclassifications of net (gains) losses to net income 33 (144) — (111)
Balance at October 1, 2022 $ (179) $ 901 $ 139 $ 861
Unrecognized
Pension and Foreign
Market Value Postretirement Currency
Adjustments Medical Translation
for Hedges Expense and Other AOCI
AOCI, after tax
Balance at September 28, 2019 $ 100 $ (5,746) $ (971) $ (6,617)
Unrealized gains (losses) arising during the period (49) (1,896) 22 (1,923)
Reclassifications of net (gains) losses to net income (202) 420 — 218
Balance at October 3, 2020 $ (151) $ (7,222) $ (949) $ (8,322)
Unrealized gains (losses) arising during the period 62 1,224 (9) 1,277
Reclassifications of net (gains) losses to net income (21) 626 — 605
Balance at October 2, 2021 $ (110) $ (5,372) $ (958) $ (6,440)
Unrealized gains (losses) arising during the period 844 2,027 (917) 1,954
Reclassifications of net (gains) losses to net income (109) 476 — 367
Balance at October 1, 2022 $ 625 $ (2,869) $ (1,875) $ (4,119)

Details about AOCI components reclassified to net income are as follows:

Affected line item in the Consolidated
Gains (losses) in net income: Statements of Operations: 2022 2021 2020
Market value adjustments, primarily Primarily revenue
cash flow hedges $ 142 $ 31 $ 263
Estimated tax Income taxes (33) (10) (61)
109 21 202

Pension and postretirement medical Interest expense, net

expense (620) (816) (547)
Estimated tax Income taxes 144 190 127
(476) (626) (420)

Total reclassifications for the period $ (367) $ (605) $ (218)

12 Equity-Based Compensation
Under various plans, the Company may grant stock options and other equity-based awards to executive, management and
creative personnel. The Company’s approach to long-term incentive compensation contemplates awards of stock options and

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restricted stock units (RSUs). Certain RSUs awarded to senior executives vest based upon the achievement of market or
performance conditions (Performance RSUs).
Stock options are generally granted with a 10 year term at exercise prices equal to or exceeding the market price at the
date of grant and become exercisable ratably over a three-year period from the grant date (exercisable ratably over four-year
period from the grant date for awards granted prior to fiscal 2021). At the discretion of the Compensation Committee of the
Company’s Board of Directors, options can occasionally extend up to 15 years after date of grant. RSUs generally vest ratably
over three years (four years for grants awarded prior to fiscal 2021) and Performance RSUs generally fully vest after three
years, subject to achieving market or performance conditions. Equity-based award grants generally provide continued vesting,
in the event of termination, for employees that reach age 60 or greater, have at least ten years of service and have held the
award for at least one year.
Each share granted subject to a stock option award reduces the number of shares available under the Company’s stock
incentive plans by one share while each share granted subject to a RSU award reduces the number of shares available by two
shares. As of October 1, 2022, the maximum number of shares available for issuance under the Company’s stock incentive
plans (assuming all the awards are in the form of stock options) was approximately 124 million shares and the number available
for issuance assuming all awards are in the form of RSUs was approximately 60 million shares. The Company satisfies stock
option exercises and vesting of RSUs with newly issued shares. Stock options and RSUs are generally forfeited by employees
who terminate prior to vesting.
Each year, generally during the first half of the year, the Company awards stock options and restricted stock units to a
broad-based group of management, technology and creative personnel. The fair value of options is estimated based on the
binomial valuation model. The binomial valuation model takes into account variables such as volatility, dividend yield and the
risk-free interest rate. The binomial valuation model also considers the expected exercise multiple (the multiple of exercise
price to grant price at which exercises are expected to occur on average) and the termination rate (the probability of a vested
option being canceled due to the termination of the option holder) in computing the value of the option.
The weighted average assumptions used in the option-valuation model were as follows:
2022 2021 2020
Risk-free interest rate 1.6% 1.2% 1.8%
Expected volatility 28% 30% 23%
Dividend yield —% 0.03% 1.36%
Termination rate 5.8% 5.8% 5.8%
Exercise multiple 1.98 1.83 1.83

Although the initial fair value of stock options is not adjusted after the grant date, changes in the Company’s assumptions
may change the value of, and therefore the expense related to, future stock option grants. The assumptions that cause the
greatest variation in fair value in the binomial valuation model are the expected volatility and expected exercise multiple.
Increases or decreases in either the expected volatility or expected exercise multiple will cause the binomial option value to
increase or decrease, respectively. The volatility assumption considers both historical and implied volatility and may be
impacted by the Company’s performance as well as changes in economic and market conditions.
Compensation expense for RSUs and stock options is recognized ratably over the service period of the award.
Compensation expense for RSUs is based on the market price of the shares underlying the awards on the grant date.
Compensation expense for Performance RSUs reflects the estimated probability that the market or performance conditions will
be met.
Compensation expense related to stock options and RSUs is as follows:
2022 2021 2020
Stock option $ 88 $ 95 $ 101
RSUs 889 505 424
Total equity-based compensation expense(1) 977 600 525
Tax impact (221) (136) (118)
Reduction in net income $ 756 $ 464 $ 407
Equity-based compensation expense capitalized during the period $ 148 $ 112 $ 87
(1)
Equity-based compensation expense is net of capitalized equity-based compensation and estimated forfeitures and
excludes amortization of previously capitalized equity-based compensation costs.

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 The following table summarizes information about stock option transactions in fiscal 2022 (shares in millions):
Weighted
Average
Shares Exercise Price
Outstanding at beginning of year 18 $ 113.99
Awards forfeited — 143.27
Awards granted 2 146.15
Awards exercised (2) 69.05
Outstanding at end of year 18 $ 121.28
Exercisable at end of year 13 $ 111.01

The following tables summarize information about stock options vested and expected to vest at October 1, 2022 (shares
in millions):
Vested
Weighted Average
Number of Weighted Average Remaining Years of
Range of Exercise Prices Options Exercise Price Contractual Life
$ 0 — $ 55 1 $ 51.28 0.3
$ 56 — $ 110 4 95.59 3.1
$ 111 — $ 165 7 120.61 5.7
$ 166 — $ 225 1 177.74 8.4
13
Expected to Vest
Weighted Average
Number of Weighted Average Remaining Years of
Range of Exercise Prices Options(1) Exercise Price Contractual Life
$ 95 — $ 125 1 $ 109.61 6.7
$ 126 — $ 155 3 148.36 8.1
$ 156 — $ 185 1 173.44 8.4
5
(1)
Number of options expected to vest is total unvested options less estimated forfeitures.
The following table summarizes information about RSU transactions in fiscal 2022 (shares in millions):

Weighted Average
Grant-Date
Units(3) Fair Value
Unvested at beginning of year 13 $ 151.61
Granted(1) 13 136.36
Vested (7) 144.39
Forfeited (1) 155.88
Unvested at end of year(2) 18 $ 144.00
(1)
Includes 0.3 million Performance RSUs
(2)
Includes 0.6 million Performance RSUs
(3)
Excludes Performance RSUs for which vesting is subject to service conditions and the number of units vesting is
subject to the discretion of the CEO. At October 1, 2022, the maximum number of these Performance RSUs that could
be issued upon vesting is 0.1 million.
The weighted average grant-date fair values of options granted during fiscal 2022, 2021 and 2020 were $46.76, $57.05
and $36.19, respectively, and for RSUs were $136.36, $178.70 and $145.27, respectively. The total intrinsic value (market
value on date of exercise less exercise price) of options exercised and RSUs vested during fiscal 2022, 2021 and 2020 totaled
$982 million, $1,175 million and $989 million, respectively. The aggregate intrinsic values of stock options vested and
expected to vest at October 1, 2022 were $50 million and $0 million, respectively.

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 As of October 1, 2022, unrecognized compensation cost related to unvested stock options and RSUs was $89 million and
$1,707 million, respectively. That cost is expected to be recognized over a weighted-average period of 1.2 years for stock
options and 1.3 years for RSUs.
Cash received from option exercises for fiscal 2022, 2021 and 2020 was $127 million, $435 million and $305 million,
respectively. Tax benefits realized from tax deductions associated with option exercises and RSU vestings for fiscal 2022, 2021
and 2020 were approximately $219 million, $256 million and $220 million, respectively.

13 Detail of Certain Balance Sheet Accounts

October 1, October 2,
2022 2021
Current receivables
Accounts receivable $ 10,811 $ 11,177
Other 1,999 2,360
Allowance for credit losses (158) (170)
$ 12,652 $ 13,367

Parks, resorts and other property

Attractions, buildings and improvements $ 33,795 $ 32,765
Furniture, fixtures and equipment 24,409 24,008
Land improvements 7,757 7,061
Leasehold improvements 1,037 1,058
66,998 64,892
Accumulated depreciation (39,356) (37,920)
Projects in progress 4,814 4,521
Land 1,140 1,131
$ 33,596 $ 32,624
Intangible assets
Character/franchise intangibles, copyrights and trademarks $ 10,572 $ 10,572
MVPD agreements 8,058 8,089
Other amortizable intangible assets 4,045 4,303
Accumulated amortization (9,630) (7,641)
Net amortizable intangible assets 13,045 15,323
Indefinite lived intangible assets(1) 1,792 1,792
$ 14,837 $ 17,115
(1)
Indefinite lived intangible assets consist of ESPN, Pixar and Marvel trademarks and television FCC licenses.

Accounts payable and other accrued liabilities

Accounts and accrued payables $ 16,205 $ 16,357
Payroll and employee benefits 3,447 3,482
Other 561 1,055
$ 20,213 $ 20,894
Other long-term liabilities
Pension and postretirement medical plan liabilities $ 1,940 $ 4,132
Operating and financing lease liabilities 3,239 3,229
Other 7,339 7,161
$ 12,518 $ 14,522

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14 Commitments and Contingencies
Commitments
The Company has various contractual commitments for rights to sports, films and other programming, totaling
approximately $75.7 billion, including approximately $2.6 billion for available programming as of October 1, 2022. The
Company also has contractual commitments for the construction of two new cruise ships, creative talent and employment
agreements and unrecognized tax benefits. Creative talent and employment agreements include obligations to actors, producers,
sports, television and radio personalities and executives. Contractual commitments for sports programming rights, other
programming rights and other commitments including cruise ships and creative talent are as follows:
Sports Other
Fiscal Year: Programming(1) Programming Other Total
2023 $ 10,783 $ 3,815 $ 2,891 $ 17,489
2024 9,906 1,469 2,735 14,110
2025 10,222 977 1,747 12,946
2026 7,420 738 379 8,537
2027 6,528 554 153 7,235
Thereafter 22,745 585 2,628 25,958
$ 67,604 $ 8,138 $ 10,533 $ 86,275

(1)
Primarily relates to rights for NFL, college football (including bowl games and the College Football Playoff) and
basketball, cricket, NBA, NHL, soccer, UFC, MLB, tennis, golf and Top Rank Boxing. Certain sports programming
rights have payments that are variable based primarily on revenues and are not included in the table above. The
Company has multi-year agreements to sublicense less than 5% of our sports right.
Legal Matters
The Company, together with, in some instances, certain of its directors and officers, is a defendant in various legal actions
involving copyright, breach of contract and various other claims incident to the conduct of its businesses. Management does not
believe that the Company has incurred a probable material loss by reason of any of those actions.

15 Leases
The Company’s operating leases primarily consist of real estate and equipment, including office space for general and
administrative purposes, production facilities, land, cruise terminals, retail outlets and distribution centers for consumer
products. The Company also has finance leases, primarily for broadcast equipment and land.
Some of our leases include renewal and/or termination options. If it is reasonably certain that a renewal or termination
option will be exercised, the exercise of the option is considered in calculating the term of the lease. As of October 1, 2022, our
operating leases have a weighted-average remaining lease term of approximately 11 years, and our finance leases have a
weighted-average remaining lease term of approximately 29 years. The weighted-average incremental borrowing rate is 2.7%
and 6.5%, for our operating leases and finance leases, respectively. At October 1, 2022 total estimated future lease payments for
non-cancelable leases agreements that have not commenced of approximately $832 million are excluded from the measurement
of the right-of-use asset and lease liability.

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 The Company’s operating and finance right-of-use assets and lease liabilities are as follows:
October 1, October 2,
2022 2021
Right-of-use assets(1)
Operating leases $ 3,966 $ 3,895
Finance leases 303 336
Total right-of-use assets 4,269 4,231

Short-term lease liabilities(2)

Operating leases 614 637
Finance leases 37 41
651 678
Long-term lease liabilities(3)
Operating leases 3,020 2,983
Finance leases 219 246
3,239 3,229
Total lease liabilities $ 3,890 $ 3,907
(1)
Included in “Other assets” in the Consolidated Balance Sheet
(2)
Included in “Accounts payable and other accrued liabilities” in the Consolidated Balance Sheet
(3)
Included in “Other long-term liabilities” in the Consolidated Balance Sheet
The components of lease costs are as follows:
2022 2021 2020
Finance lease cost
Amortization of right-of-use assets $ 39 $ 42 $ 37
Interest on lease liabilities 15 20 16
Operating lease cost 796 853 899
Variable fees and other(1) 363 414 491
Total lease cost $ 1,213 $ 1,329 $ 1,443
(1)
Includes variable lease payments related to our operating and finance leases and costs of leases with initial terms of
less than one year, net of sublease income
Cash paid during the year for amounts included in the measurement of lease liabilities is as follows:
2022 2021 2020
Operating cash flows for operating leases $ 736 $ 925 $ 879
Operating cash flows for finance leases 15 20 16
Financing cash flows for finance leases 48 25 37
Total $ 799 $ 970 $ 932

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 Future minimum lease payments, as of October 1, 2022, are as follows:
Operating Financing
Fiscal Year:
2023 $ 704 $ 52
2024 590 43
2025 523 38
2026 384 33
2027 272 27
Thereafter 2,072 423
Total undiscounted future lease payments 4,545 616
Less: Imputed interest (910) (360)
Total reported lease liability $ 3,635 $ 256

16 Fair Value Measurement

The Company’s assets and liabilities measured at fair value are summarized in the following tables by fair value
measurement Level. See Note 10 for definitions of fair value measures and the Levels within the fair value hierarchy.
Fair Value Measurement at October 1, 2022
Description Level 1 Level 2 Level 3 Total
Assets
Investments $ 308 $ — $ — $ 308
Derivatives
Interest rate — 1 — 1
Foreign exchange — 2,223 — 2,223
Other — 10 — 10
Liabilities
Derivatives
Interest rate — (1,783) — (1,783)
Foreign exchange — (1,239) — (1,239)
Other — (31) — (31)
Other — (354) — (354)
Total recorded at fair value $ 308 $ (1,173) $ — $ (865)

Fair value of borrowings $ — $ 42,509 $ 1,510 $ 44,019

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 Fair Value Measurement at October 2, 2021
Description Level 1 Level 2 Level 3 Total
Assets
Investments $ 950 $ — $ — $ 950
Derivatives
Interest rate — 186 — 186
Foreign exchange — 707 — 707
Other — 10 — 10
Liabilities
Derivatives
Interest rate — (287) — (287)
Foreign exchange — (618) — (618)
Other — (8) — (8)
Other — (375) — (375)
Total recorded at fair value 950 (385) — 565

Fair value of borrowings $ — $ 58,913 $ 1,411 $ 60,324

The fair values of Level 2 derivatives are primarily determined by internal discounted cash flow models that use
observable inputs such as interest rates, yield curves and foreign currency exchange rates. Counterparty credit risk, which is
mitigated by master netting agreements and collateral posting arrangements with certain counterparties, had an impact on
derivative fair value estimates that was not material.
Level 2 other liabilities are primarily arrangements that are valued based on the fair value of underlying investments,
which are generally measured using Level 1 and Level 2 fair value techniques.
Level 2 borrowings, which include commercial paper, U.S. dollar denominated notes and certain foreign currency
denominated borrowings, are valued based on quoted prices for similar instruments in active markets or identical instruments in
markets that are not active.
Level 3 borrowings include the Asia Theme Park borrowings, which are valued based on the current borrowing cost and
credit risk of the Asia Theme Parks as well as prevailing market interest rates.
The Company’s financial instruments also include cash, cash equivalents, receivables and accounts payable. The carrying
values of these financial instruments approximate the fair values.
The Company also has assets that are required to be recorded at fair value on a non-recurring basis. These assets are
evaluated when certain triggering events occur (including a decrease in estimated future cash flows) that indicate the asset
should be evaluated for impairment. In fiscal 2020, the Company recorded impairment charges for goodwill and intangible
assets as disclosed in Note 18. The fair value of these assets was determined using estimated discounted future cash flows,
which is a Level 3 valuation technique.
Credit Concentrations
The Company monitors its positions with, and the credit quality of, the financial institutions that are counterparties to its
financial instruments on an ongoing basis and does not currently anticipate nonperformance by the counterparties.
The Company does not expect that it would realize a material loss, based on the fair value of its derivative financial
instruments as of October 1, 2022, in the event of nonperformance by any single derivative counterparty. The Company
generally enters into derivative transactions only with counterparties that have a credit rating of A- or better and requires
collateral in the event credit ratings fall below A- or aggregate exposures exceed limits as defined by contract. In addition, the
Company limits the amount of investment credit exposure with any one institution.
The Company does not have material cash and cash equivalent balances with financial institutions that have below
investment grade credit ratings and maintains short-term liquidity needs in high quality money market funds. At October 1,
2022, the Company did not have balances (excluding money market funds) with individual financial institutions that exceeded
10% of the Company’s total cash and cash equivalents.
The Company’s trade receivables and financial investments do not represent a significant concentration of credit risk at
October 1, 2022 due to the wide variety of customers and markets in which the Company’s products are sold, the dispersion of
our customers across geographic areas and the diversification of the Company’s portfolio among financial institutions.

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17 Derivative Instruments
The Company manages its exposure to various risks relating to its ongoing business operations according to a risk
management policy. The primary risks managed with derivative instruments are interest rate risk and foreign exchange risk.
The Company’s derivative positions measured at fair value are summarized in the following tables:
As of October 1, 2022
Other Other Long-
Current Other Current Term
Assets Assets Liabilities Liabilities
Derivatives designated as hedges
Foreign exchange $ 864 $ 786 $ (228) $ (350)
Interest rate — 1 (1,783) —
Other 10 — (4) —
Derivatives not designated as hedges
Foreign exchange 336 247 (374) (287)
Other — — (27) —
Gross fair value of derivatives 1,210 1,034 (2,416) (637)
Counterparty netting (831) (715) 1,070 476
Cash collateral (received) paid (341) (151) 1,282 96
Net derivative positions $ 38 $ 168 $ (64) $ (65)

As of October 2, 2021
Other Other Long-
Current Other Current Term
Assets Assets Liabilities Liabilities
Derivatives designated as hedges
Foreign exchange $ 165 $ 240 $ (122) $ (83)
Interest rate — 186 (287) —
Other 10 — — —
Derivatives not designated as hedges
Foreign exchange 183 119 (208) (205)
Other (8) — — —
Gross fair value of derivatives 350 545 (617) (288)
Counterparty netting (301) (360) 460 201
Cash collateral (received) paid (3) (51) 157 73
Net derivative positions $ 46 $ 134 $ — $ (14)

Interest Rate Risk Management

The Company is exposed to the impact of interest rate changes primarily through its borrowing activities. The Company’s
objective is to mitigate the impact of interest rate changes on earnings and cash flows and on the market value of its
borrowings. In accordance with its policy, the Company targets its fixed-rate debt as a percentage of its net debt between a
minimum and maximum percentage. The Company primarily uses pay-floating and pay-fixed interest rate swaps to facilitate its
interest rate risk management activities.
The Company designates pay-floating interest rate swaps as fair value hedges of fixed-rate borrowings effectively
converting fixed-rate borrowings to variable-rate borrowings indexed to LIBOR. As of October 1, 2022 and October 2, 2021,
the total notional amount of the Company’s pay-floating interest rate swaps was $14.5 billion and $15.1 billion, respectively.

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 The following table summarizes fair value hedge adjustments to hedged borrowings:
Carrying Amount of Hedged Fair Value Adjustments Included
Borrowings in Hedged Borrowings
October 1, October 2, October 1, October 2,
2022 2021 2022 2021
Borrowings:
Current $ 997 $ 505 $ (3) $ 5
Long-term 12,358 15,136 (1,733) (103)
$ 13,355 $ 15,641 $ (1,736) $ (98)

The following amounts are included in “Interest expense, net” in the Consolidated Statements of Operations:
2022 2021 2020
Gain (loss) on:
Pay-floating swaps $ (1,635) $ (603) $ 479
Borrowings hedged with pay-floating swaps 1,635 603 (479)
Benefit associated with interest accruals on pay-floating swaps 31 143 28

The Company may designate pay-fixed interest rate swaps as cash flow hedges of interest payments on floating-rate
borrowings. Pay-fixed interest rate swaps effectively convert floating-rate borrowings to fixed-rate borrowings. The unrealized
gains or losses from these cash flow hedges are deferred in AOCI and recognized in interest expense as the interest payments
occur. The Company did not have pay-fixed interest rate swaps that were designated as cash flow hedges of interest payments
at October 1, 2022 or at October 2, 2021, and gains and losses related to pay-fixed swaps recognized in earnings for fiscal 2022,
2021 and 2020 were not material.
Foreign Exchange Risk Management
The Company transacts business globally and is subject to risks associated with changing foreign currency exchange rates.
The Company’s objective is to reduce earnings and cash flow fluctuations associated with foreign currency exchange rate
changes, enabling management to focus on core business issues and challenges.
The Company enters into option and forward contracts that change in value as foreign currency exchange rates change to
protect the value of its existing foreign currency assets, liabilities, firm commitments and forecasted but not firmly committed
foreign currency transactions. In accordance with policy, the Company hedges its forecasted foreign currency transactions for
periods generally not to exceed four years within an established minimum and maximum range of annual exposure. The gains
and losses on these contracts offset changes in the U.S. dollar equivalent value of the related forecasted transaction, asset,
liability or firm commitment. The principal currencies hedged are the euro, Japanese yen, British pound, Chinese yuan and
Canadian dollar. Cross-currency swaps are used to effectively convert foreign currency denominated borrowings into U.S.
dollar denominated borrowings.
The Company designates foreign exchange forward and option contracts as cash flow hedges of firmly committed and
forecasted foreign currency transactions. As of October 1, 2022 and October 2, 2021, the notional amounts of the Company’s
net foreign exchange cash flow hedges were $7.4 billion and $6.9 billion, respectively. Mark-to-market gains and losses on
these contracts are deferred in AOCI and are recognized in earnings when the hedged transactions occur, offsetting changes in
the value of the foreign currency transactions. Net deferred gains recorded in AOCI for contracts that will mature in the next
twelve months total $704 million. The following table summarizes the effect of foreign exchange cash flow hedges on AOCI:
2022 2021 2020
Gain (loss) recognized in Other Comprehensive Income $ 1,093 $ 61 $ (63)
Gain (loss) reclassified from AOCI into the Statement of Operations(1) 116 24 269
(1)
Primarily recorded in revenue.
The Company designates cross currency swaps as fair value hedges of foreign currency denominated borrowings. The
impact of the cross currency swaps is recorded to “Interest expense, net” to offset the foreign currency impact of the foreign
currency denominated borrowing. As of October 1, 2022 and October 2, 2021, the total notional amounts of the Company’s
designated cross currency swaps were Canadian $1.3 billion ($0.9 billion) and Canadian $1.3 billion ($1.0 billion), respectively.

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 The following amounts are included in “Interest expense, net” in the Consolidated Statements of Operations:
2022 2021 2020
Gain (loss) on:
Cross currency swaps $ (84) $ 47 $ 53
Borrowings hedged with cross currency swaps 84 (47) (53)

Foreign exchange risk management contracts with respect to foreign currency denominated assets and liabilities are not
designated as hedges and do not qualify for hedge accounting. The notional amounts of these foreign exchange contracts at
October 1, 2022 and October 2, 2021 were $3.8 billion and $3.5 billion, respectively. The following table summarizes the net
foreign exchange gains or losses recognized on foreign currency denominated assets and liabilities and the net foreign exchange
gains or losses on the foreign exchange contracts we entered into to mitigate our exposure with respect to foreign currency
denominated assets and liabilities by the corresponding line item in which they are recorded in the Consolidated Statements of
Operations:
Costs and Expenses Interest expense, net Income Tax Expense
2022 2021 2020 2022 2021 2020 2022 2021 2020
Net gains (losses) on foreign
currency denominated assets
and liabilities $ (685) $ (30) $ 10 $ 82 $ (47) $ 1 $ 212 $ (7) $ (35)
Net gains (losses) on foreign
exchange risk management
contracts not designated as
hedges 547 (83) (56) (82) 47 — (208) 2 33
Net gains (losses) $ (138) $ (113) $ (46) $ — $ — $ 1 $ 4 $ (5) $ (2)

Commodity Price Risk Management

The Company is subject to the volatility of commodities prices, and the Company designates certain commodity forward
contracts as cash flow hedges of forecasted commodity purchases. Mark-to-market gains and losses on these contracts are
deferred in AOCI and are recognized in earnings when the hedged transactions occur, offsetting changes in the value of
commodity purchases. The notional amount of these commodities contracts at October 1, 2022 and October 2, 2021 and related
gains or losses recognized in earnings were not material for fiscal 2022, 2021 and 2020.
Risk Management – Other Derivatives Not Designated as Hedges
The Company enters into certain other risk management contracts that are not designated as hedges and do not qualify for
hedge accounting. These contracts, which include certain total return swap contracts, are intended to offset economic exposures
of the Company and are carried at market value with any changes in value recorded in earnings. The notional amount of these
contracts at both October 1, 2022 and October 2, 2021 was $0.4 billion, respectively. The related gains or losses recognized in
earnings were not material for fiscal 2022, 2021 and 2020.
Contingent Features and Cash Collateral
The Company has master netting arrangements by counterparty with respect to certain derivative financial instrument
contracts. The Company may be required to post collateral in the event that a net liability position with a counterparty exceeds
limits defined by contract and that vary with the Company’s credit rating. In addition, these contracts may require a
counterparty to post collateral to the Company in the event that a net receivable position with a counterparty exceeds limits
defined by contract and that vary with the counterparty’s credit rating. If the Company’s or the counterparty’s credit ratings
were to fall below investment grade, such counterparties or the Company would also have the right to terminate our derivative
contracts, which could lead to a net payment to or from the Company for the aggregate net value by counterparty of our
derivative contracts. The aggregate fair values of derivative instruments with credit-risk-related contingent features in a net
liability position by counterparty were $1,507 million and $244 million at October 1, 2022 and October 2, 2021, respectively.

18 Restructuring and Impairment Charges

Goodwill and Intangible Asset Impairment
Prior to a reorganization of the Company’s operations in October 2020, a former segment, Direct-to-Consumer &
International, included the International Channels reporting unit, which comprised the Company’s international television
networks. In fiscal 2020, the Company tested this former reporting unit’s goodwill and long-lived assets (including intangible
assets) for impairment. This resulted in non-cash impairment charges of $1.9 billion relating primarily to our MVPD agreement

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intangible assets and $3.1 billion to fully impair the reporting unit’s goodwill. These charges were recorded in “Restructuring
and impairment charges” in the Consolidated Statements of Operations in fiscal 2020.
As of October 1, 2022, the remaining balance of our international MVPD agreement intangible assets was $1.6 billion,
primarily related to our channel businesses in Latin America and India.
TFCF Integration
The Company’s restructuring plan implemented in connection with the 2019 acquisition of TFCF to realize cost synergies
was completed in fiscal 2021. To date, we have recorded restructuring charges primarily related to DMED of $1.8 billion
including $1.4 billion related to severance (including employee contract terminations) and $0.3 billion of equity based
compensation costs, primarily for TFCF awards that were accelerated to vest upon the closing of the acquisition.
The changes in restructuring reserves related to the TFCF integration, including amounts recorded in “Restructuring and
impairment charges” in the Consolidated Statements of Operations in fiscal 2021 and 2020, are as follows (activity in fiscal
2022 and the balance at October 1, 2022 were not material):

Balance at September 28, 2019 $ 676

Additions in fiscal 2020 453
Payments in fiscal 2020 (772)
Balance at October 3, 2020 357
Additions in fiscal 2021 44
Payments in fiscal 2021 (351)
Balance at October 2, 2021 $ 50

Other
In fiscal 2022, the Company recorded charges of $0.2 billion, primarily due to asset impairments related to our businesses
in Russia. In fiscal 2021, the Company recorded restructuring and impairment charges of $0.6 billion, primarily related to the
planned closure of an animation studio and a substantial number of our Disney-branded retail stores in North America and
Europe as well as severance at our parks and experiences businesses. In fiscal 2020, the Company recorded restructuring and
impairment charges of $0.3 billion, primarily for severance at our parks and experiences businesses. These charges are reported
in “Restructuring and impairment charges” in the Consolidated Statements of Operations.

19 New Accounting Pronouncements

Accounting Pronouncements Adopted in Fiscal 2022
Simplifying the Accounting for Income Taxes
In December 2019, the Financial Accounting Standards Board (FASB) issued guidance which simplifies the accounting
for income taxes. The guidance amends the rules for recognizing deferred taxes for investments, performing intraperiod tax
allocations and calculating income taxes in interim periods. It also reduces complexity in certain areas, including the accounting
for transactions that result in a step-up in the tax basis of goodwill and allocating taxes to members of a consolidated group. The
Company adopted the new guidance in the first quarter of fiscal 2022. The adoption did not have a material impact on our
financial statements.
Facilitation of the Effects of Reference Rate Reform
In March 2020, the FASB issued guidance which provides optional expedients and exceptions for applying current GAAP
to contracts, hedging relationships, and other transactions affected by the transition from the use of LIBOR to an alternative
reference rate. The guidance is applicable to contracts entered into before January 1, 2023. The Company adopted the new
guidance in the first quarter of fiscal 2022. The adoption did not have a material impact on our financial statements.
Accounting Pronouncements Not Yet Adopted
Disclosures by Business Entities about Government Assistance
In November 2021, the FASB issued guidance requiring annual disclosures about transactions with a government that are
accounted for by analogizing to a grant or contribution accounting model. The new guidance requires the disclosure of the
nature of the transactions, the accounting for the transactions, and the effect of the transactions on the financial statements. The
guidance is effective for annual periods beginning with the Company’s 2023 fiscal year. While the guidance will not have an
effect on the Company’s Consolidated Statements of Operations or Consolidated Balance Sheets upon adoption, the Company
may need to disclose the effects on the financial statements of incentives related to the production of content, which is the most
significant type of government assistance we receive.

112
Comparison of five-year cumulative total return

The following graph compares the performance of the Company’s common stock with the performance of the S&P 500 and the
Media Industry Peers, assuming $100 was invested on September 29, 2017 (the last trading day of the 2017 fiscal year) in the
Company’s common stock, the S&P 500 and the Media Industry Peers.

The Media Industry Peers is a custom index consisting of, in addition to The Walt Disney Company, media enterprises
Alphabet, Amazon, Apple, AT&T, Comcast, Meta Platforms, Netflix, Paramount and Warner Bros. Discovery.

113
[THIS PAGE INTENTIONALLY LEFT BLANK]
 BOARD OF DIRECTORS* EXECUTIVE OFFICERS*
Susan E. Arnold Michael B. G. Froman Robert A. Chapek**
Chairman of the Board Vice Chairman and President, Strategic Growth Chief Executive Officer
The Walt Disney Company Mastercard Incorporated
Horacio E. Gutierrez
Mary T. Barra Maria Elena Lagomasino Senior Executive Vice President and
Chair and Chief Executive Officer Chief Executive Officer and Managing Partner General Counsel
General Motors Company WE Family Offices
Christine M. McCarthy
Safra A. Catz Calvin R. McDonald Senior Executive Vice President and
Chief Executive Officer Chief Executive Officer Chief Financial Officer
Oracle Corporation lululemon athletica inc.
Paul J. Richardson
Amy L. Chang Mark G. Parker Senior Executive Vice President and
Former Executive Vice President Executive Chairman Chief Human Resources Officer
Cisco Systems, Inc. NIKE, Inc
Kristina K. Schake
Robert A. Chapek** Derica W. Rice Senior Executive Vice President and
Chief Executive Officer Former Executive Vice President Chief Communications Officer
The Walt Disney Company CVS Health Corporation

Francis A. deSouza
President and Chief Executive Officer
Illumina, Inc.

STOCK EXCHANGE
Disney common stock is listed for trading on the New
York Stock Exchange under the ticker symbol DIS.

REGISTRAR AND TRANSFER AGENT

Computershare
Attention: Disney Shareholder Services
P.O. Box 43013
Providence, RI 02940-3013
Phone: 1-855-553-4763

E-Mail: [email protected]

Internet: www.disneyshareholder.com

A copy of the Company’s annual report filed with

the Securities and Exchange Commission (Form
10-K) will be furnished without charge to any
shareholder upon written request to the name and
address listed above.

Robert A. Iger Carolyn N. Everson

Director Director
Chief Executive Officer Former President, Instacart
The Walt Disney Company Effective 11/21/2022
Effective 11/20/2022

*Titles are as of the end of fiscal 2022.

**Separated in fiscal 2023.

© Disney
Industry
Surveys
Media & Entertainment
SEPTEMBER 2022

Kenneth Leon Fateh Yahaya

Equity Analyst Industry Analyst
 

CONTENTS Contacts
Sales Inquires & Client
Support
5 Industry Snapshot 800.220.0502
[email protected]
6 Financial Metrics
Media Inquiries
9 Key Industry Drivers [email protected]
CFRA
12 Video Streaming: Navigating Choppy
977 Seminole Trail, PMB 230
Waters Charlottesville, VA 22901
16 Industry Trends

19 Porter’s Five Forces Contributors

Raymond Jarvis
26 How the Industry Operates Senior Editor

37 How to Analyze a Company in this Industry Atifi Kuddus, Geraldine Tan

Associate Editors
43 Glossary
Marc Bastow
Contributing Editor
46 Industry References

49 Comparative Company Analysis

Copyright © 2022
CFRA
977 Seminole Trail, PMB 230
Charlottesville, VA 22901
All rights reserved.

 
CHARTS & FIGURES NEW THEMES

6 Cable & Satellite Revenue

Cable & Satellite EBITDA

7 Movies & Entertainment Revenue What’s Changed: There is

Movies & Entertainment EBITDA wide debate whether
subscription video on demand
8 Advertising Revenue (SVOD) can achieve the
Advertising EBITDA same economics as linear
broadcast and pay-TV. CFRA
9 Consumer Confidence Index thinks it’s choppy waters
Real GDP Growth ahead for video streaming
players – our in-depth
10 Global Advertising Expenditure Forecasts analysis on page 12.
North America OTT Video Subscription
Market Projection

13 Netflix Towers Over All Linear and SVOD

Networks
What’s Changed: Despite
14 U.S. Pay-TV Household Market holding up surprisingly well
during the pandemic,
SVOD Churn Rates in U.S. Market
advertising spend across
media may slow down due to
15 Global Advertising by Media Type
economic uncertainty such as
16 Global Industry Revenue a recession. Head to page 15
for details.
17 Profit Share Map of the Movies &
Entertainment Industry
Profit Share Map of the
Broadcasting/Cable & Satellite Industries
What’s Changed: CFRA
18 Profit Share Map of the Advertising believes data, analytics, and
Industry content will be post-pandemic
Profit Share Map of the Publishing Industry M&A drivers. More on this on
page 21.
21 Diversified Global Businesses of Media
Conglomerates
EXECUTIVE SUMMARY

CFRA has a neutral outlook on the Media and Entertainment industries. Below are the key themes we
highlight for 2022.

Global Economy Will Determine Pace of Growth in Media and Entertainment Industry
In late 2022 and 2023, we expect media and entertainment companies to feel the impact of a potential
global recession that reduces consumer disposal spending. Consumer sentiment has already reached
decades lows in the U.S. market and happening in other developed countries, especially in Europe. We
are seeing a pickup of out-of-home entertainment sectors (live events, sports, theme parks, film and TV
studios, and movie exhibitors).

Accelerated Secular Trends in Broadband and Video Consumption…

In a likely acceleration of existing secular trends and audience fragmentation in the media ecosystem, the
Covid-19 pandemic has provided a boon for streaming and cable broadband subscriptions, with a shift to
in-home entertainment options. Considering the potentially lasting shifts in broadband consumption, the
pandemic has exacerbated the secular cord-cutting trend and will likely accelerate the decline of the
linear television ecosystem in the foreseeable future, while the economic fallout of the pandemic on
consumers and households is likely to further undercut the value proposition of traditional pay-TV
packages in favor of cheaper streaming video offerings.

Escalation of the Content Arms Race Amid Intensifying Streaming Wars…

With film/TV production by Hollywood studios back in full swing after the lockdown, global programming
and production costs in 2022 are seeing some cutbacks to bring more discipline to spending activity.
There is growth from media companies that are launching or expanding their video streaming services
internationally. As several notable entrants (such as Disney+, HBO Max, Peacock, and Paramount+)
increasingly take on early movers such as Netflix, Amazon Prime Video, and Hulu, the global streaming
wars are likely to intensify further in the year ahead.

Cautious Outlook for Traditional Advertising Growth Ahead

Our view reflects the underlying trends across some of the key buyer categories for both local and
national advertising spending. Over the past several years, television ratings (viewership) have been
mired in a secular decline even as pricing in the forward (“upfront”) and spot (“scatter”) advertising
markets have held up relatively well as marketers continue their quest to reach mass audiences.

Recession May Alter Pandemic Boon for Subscription Video on Demand (SVOD)
We see a secular trend in households starting or substituting video on demand from cable broadband
subscriptions and a shift to in-home entertainment options like social media and gaming. Considering
broadband consumption, video streaming has exacerbated cord-cutting trends and may accelerate the
decline of the linear television ecosystem in the foreseeable future. In 2022 and 2023, we think rising
inflation, lower disposable income, and inflation may put pressure on households with multiple SVOD
subscriptions.

SVOD May Be Slowing Down as Consumers and Advertisers/Marketers Cut Back

We think investors have become more skeptical about the holy grail of the big switch to SVOD. The Bull
case for SVOD has been multi-year secular growth from long-term substitution of linear pay-TV viewing,
and advertisers/marketers will follow. The Bear case is video streaming exhaustion, with too many
choices and preferences to do more gaming, social media, or other. We worry about how capital-intensive
SVOD is to invest in content and drive membership growth.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 4

MEDIA & ENTERTAINMENT
Outlook: Neutral
MARKET CAP BREAKDOWN* BY THE NUMBERS
RANK COMPANY MARKET
NO. NAME CAP
($ billion)
$795 billion 1.1 billion
1 Walt Disney 204.3 Global
2 Comcast 159.7
Global
advertising
3 Netflix 99.4 streaming
expenditure 4
4 Charter 66.0 subscriptions
estimated in
Communications in 2021
2022
5 Spotify 20.9
Others† 562.0
Source: CFRA, S&P Global Market Intelligence.
*Data as of August 31, 2022.
†Refer to the “Comparative Company Analysis” section of
this survey for the list of companies.

2.3 billion 26%

ETF FOCUS Global Portion of
number of U.S. TV time
XLC AUM ($M)
Expense spent on
Communication Ratio OTT users in
Services Select 9,711.9 2021 streaming
Sector SPDR
0.12 videos

VOX AUM ($M)

Expense
Vanguard Ratio
Communication 2,704.4 0.10
Services
55% 1,665
FCOM AUM ($M)
Expense More OTT Number of
Fidelity MSCI Ratio
Telecommunication 561.3 viewing by U.S.
Services
0.08 U.S. adults TV/online
during original
Expense pandemic series
PBS AUM ($M)
Ratio
Invesco Dynamic 38.4
Media 0.63

PERFORMANCE SINCE INDEX INITIATION

140% Global Advertising Global Broadcasting
120% Global Cable & Satellite Global Movies and Entertainment
100% Global Publishing S&P Composite 1500 Media & Entertainment
80% S&P Europe 350 - Media & Entertainment FTSE Asia Pacific Index - Media

60%
40%
20%
0%
-20%
-40%
-60%

5 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

FINANCIAL METRICS

Cable & Satellite Sub-Industry Total Revenue

  

(in $, billions)
250 25% ◆ After a 9.6% revenue growth in 2021, we project
revenue for the cable and satellite sub-industry
200 20% to be 2.2% in 2022 and 0.3% in 2022 – with
incremental political advertising from the mid-
150 15%
term elections in the September to early
100 10% November period.
◆ The pandemic exacerbated cord-cutting trends
50 5%
as value-seeking consumers resorted to cheaper
0 0% forms of entertainment. We think net revenue
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
(e) (e) growth will see increased subscriber monthly
Total Revenue (left scale)
Revenue Growth (right scale)
churn as higher cost of living is putting pressure
e-Estimate.
Source: CFRA, S&P Global Market Intelligence.
on households in all parts of the world.
◆ Slowing subscription growth with higher
customer churn is likely to continue in 2022 and
2023. We think substation from 5G fixed wireless
to the home and video on demand (SVOD) has
ignited new questions about the economics of
cable and satellite revenue growth.

Cable & Satellite Sub-Industry Median EBITDA Margin

 v 

(in percent)
44%
◆ We project the sub-industry median EBITDA
margin to narrow from 42.3% in 2021 to 40.9% in
42%
both 2022 and 2023 during economic slowdown
40%
to potential recession.
38%
◆ Our margin outlook reflects further content
36%
investments in direct-to-consumer offerings and
34% wireless initiatives while programming costs per
32% video subscriber are expected to moderate.
30%
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
◆ Looking further ahead, we expect margin to
e-Estimate. (e) (e) benefit from continued shifts to high-margin
Source: CFRA, S&P Global Market Intelligence.
  connectivity businesses on growth in high-speed
data and contribution from relatively nascent
wireless offerings.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 6

 Movies & Entertainment Sub-Industry Total Revenue
(in $, billions)
300 30% ◆ Revenue growth for the movies and
25% entertainment sub-industry rebounded in 2021 to
250 20% 9.7%, and we expect it to recover significantly to
200
15% 13.4% in 2022 before slowing down to 11.4% in
10% 2023.
5%
150
0% ◆ The sharp contraction in 2020 was partly due to
100 -5% the Covid-19 lockdown, resulting in the
-10% temporary closures of movie theatres and the
50 -15% shutdown of TV/film production, as well as the
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
(e) (e) mass cancellations of live sports and
Total Revenue (left scale)
Revenue Growth (right scale)
entertainment events.
e-Estimate.
Source: CFRA, S&P Global Market Intelligence. ◆ However, the subsequent rebound should reflect
a resurgence in the content pipeline after the
pandemic-related disruption, combined with
continued strong growth in revenues from
streaming platforms on audience growth and
higher consumer engagement.

Movies & Entertainment Sub-Industry Median EBITDA Margin

(in percent)
25% ◆ We project the movies & entertainment sub-
industry’s median EBITDA margin to recover,
20%
widening to 18.7% in 2022 from 15.4% in 2021
and then rise to 21.0% in 2023, benefiting from
increased monetization of the content pipeline
15%
and incremental demand for out-of-home
entertainment following the pandemic-related
10%
disruption.

5%
◆ Margins in 2020 were pressured by a significant
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
(e) (e)
increase in content investments amid an
e-Estimate.
Source: CFRA, S&P Global Market Intelligence.
escalation of the streaming wars in addition to a
 

loss in revenue related to the Covid-19

lockdowns.
◆ We are seeing margin pressures ease by the
very significant cost-reduction measures
undertaken by several companies amid the
pandemic, including employee furloughs and
workforce reduction. In 2022, movie theater
attendance is up sharply versus the last two prior
years.

7 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

 Advertising Sub-Industry Total Revenue
(in $, billions)
120 10% ◆ Following a 12.6% revenue decline in 2020,
advertising revenue rebounded to 4.8% annual
110
5% growth in 2021. In 2022, we are seeing
advertisers/marketers cut back on spending
0%
leading to a -1.1% revenue decline.
100
-5% ◆ Looking ahead, we anticipate a slowing economy
90 or potential recession to lead to potential further
-10%
cuts in advertising spending that may not be fully
80 -15%
reflected in consensus estimates for advertising
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
(e) (e)
firms. We believe the major advertising firms
Total Revenue (left scale) have the benefit of other revenue streams from
Revenue Growth (right scale)
e-Estimate. public relations, specialty communications, and
Source: CFRA, S&P Global Market Intelligence.
  customer relationship management businesses.

Advertising Sub-Industry Median EBITDA Margin

(in percent)
17% ◆ We project the sub-industry median EBITDA
margin to flatten to 15.4% in 2022 compared to
16%
15.1% in 2021. Industry EBITDA margin held up
15% well in 2020 due to a lower COGS of digital
advertising that should partly offset any potential
14%
declines in revenue in a global recession.
13%
◆ Margins in 2020 were also supported by cost-
12% reduction measures amid the pandemic,
11% including employee furloughs and workforce
reduction.
10%
CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY22 CY23
(e) (e) ◆ We think margins should partly benefit from
e-Estimate.
recent portfolio realignment actions via “tuck-in”
Source: CFRA, S&P Global Market Intelligence.   acquisitions and selective divestitures. In 2023, a
pullback of discretionary spending by several
marketers might lead to revenue and margin
pressure ahead.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 8

KEY INDUSTRY DRIVERS

Consumer Confidence Index (CCI)

(index, 1985=100) (normal=100, seasonally adjusted)
◆ The July 2022 data shows CCI levels declined
160 0
27% versus the prior year, and year-over-year
140
-5 declines for this metric have been above 20%
120
-10 since March 2022. CCI scores above 100
100
indicate consumers feel more optimistic about
80 -15
the economy than they did in 1985; anything
60
40
-20 below 100 means they feel less confident than in
20
-25 1985.
0 -30 ◆ The Conference Board’s July release stated that
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022*
as the Fed raises interest rates to rein in
U.S. Consumer Confidence Index (left scale)
Europe Consumer Confidence Index (right scale) inflation, purchasing intentions for large ticket
*Data through July. items like homes, cars, and major appliances all
Source: The Conference Board, OECD.
  pulled back. We are likely to see headwinds for
consumer spending in the next six to 12 months.

Real GDP Growth

(percent change, Y/Y)

20 ◆ Global real GDP has demonstrated a

15
progressive recovery in 2021 from the decline in
10
2020, following the ease of Covid-19 lockdown
5
measures and ongoing vaccine distributions
0
worldwide. Global GDP is headed for slow
-5
growth in 2022, with inflation being a major
-10
concern beside still reeling from the pandemic
and Ukraine-Russia war.
-15
-20 ◆ The World Bank currently projects the following
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
(e) (e) GDP growth:
U.S. E.U. China
• U.S.: 2.5% in 2022; 2.4% in 2023.
e-Estimated, *Estimates by the World Bank. • E.U.: 2.5% in 2022; 1.9% in 2023.
Source: Bureau of Economic Analysis, CEIC Data, World Bank.
  • China: 4.3% in 2022; 5.2% in 2023.

9 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

 Global Advertising Expenditure Forecasts
(in $, millions)
1,200,000 ◆ Global ad spend is projected to grow at a
compound annual growth rate (CAGR) of 6.5% to
1,000,000
reach $1.02 billion in 2026, according to SNL
800,000 Kagan. Digital advertising will account for 73.7%
of global ad spend in 2026, led by internet search
600,000
and social media, both of which SNL Kagan
400,000 expects to increase at CAGRs of 10.0% to 13%,
respectively.
200,000
◆ Within traditional media, print has long been in
0
decline as readers and advertisers switch to
online alternatives. Other traditional media are
Digital Ad Spend Outdoor Print Radio Television also expected to experience declines. Radio and
Source: Magna Global, SNL Kagan.
  TV ad revenues are forecasted to shrink at a flat
to slightly higher level.

North America OTT Video Subscription Market Projection*

(millions of households) (percent)
◆ While the number of traditional pay-TV
140 90
households in North America is projected to
120 88 shrink in the coming years, the number of
100
86
OTT (over-the-top) households is projected
80 to grow at a CAGR of 3.6% from 2019
60
84
through 2025 (latest available data).
82
40 ◆ The percentage of households that own
20 80 broadband and also subscribe to OTT video
is projected to reach 89.2% in 2025,
0 78
2019 2020 2021 2022 2023 2024 2025 according to SNL Kagan.
OTT video subscription (left scale) ◆ Major factors for changes in media
OTT subscription as a % broadband homes (right scale)
consumption besides the economy include
*U.S. data as of November 2020, Canada data as of January 2021. the relatively high cost of pay-TV services
Source: SNL Kagan.
  compared to cheaper online video
alternatives, a continued increase in the
number of broadband-only households, and
demographic influences (millennials and
others).
 

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 10

 Total Home Video Spending Forecasts 
(in $, billions, as of October 21, 2021)
60 ◆ Online video revenue is projected to grow
at a CAGR of 7.5%, from $21.6 billion in
50
2019 (latest available data) to $53.2 billion
40 in 2031, which will represent 96.3% of the
30 home video market share by then,
according to SNL Kagan.
20

10
◆ The rapid growth in online video spending is
expected to offset the drop in DVD and Blu-
0
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
ray revenue as well as multi-channel
PPV/VOD over the next decade.
Online video DVD & Blu-ray rental/Sell-through Multichannel PPV/VOD*
Technological advancements have
*Includes movie, SVOD, adult, TV and electronic sell-through revenue; excludes
event revenue. redefined the home video universe as
Source: SNL Kagan. consumers now have several ways to
access content at home via a wide array of
devices.

11 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

VIDEO STREAMING: NAVIGATING CHOPPY WATERS

Slowing subscription video on demand (SVOD) has ignited new questions about the economics and ROI
for this media distribution format. There is wide debate whether SVOD can achieve the same economics
with high recurring revenue and EBITDA growth as linear broadcast and pay-TV format has delivered in
the past. Netflix’s last two quarters, with flat or lower net subscribers, underscore the maturity of ad-free
video streaming. In 2023, Netflix will introduce ad-supported video streaming (AVOD), which is offered by
its major competitors. WBD sent a different message to investors – that their primary focus is generating
profitability and free cash flow from streaming, not growth just for driving higher customer base. DIS
tapered its membership growth target, net of 4%+ monthly churn. Also, not all subscribers are created
equal, as the average rate varies widely by subscriber plan in the U.S., with more striking differences in
emerging markets like India, nearly 40% of Disney+ total subscribers.

We think investors have become more skeptical about the holy grail of the big switch to SVOD. Year-to-
date (YTD) through August 11, 2022, the S&P Movies & Entertainment Index has declined 46.5%, versus
a 13.0% decrease in the S&P 500 Index. In 2021, the sub-industry was 2.4% lower, compared to a 26.9%
gain for broader market benchmark. We think equity analysts are likely to reduce target prices, revenue,
and EPS estimates as optimism about SVOD trends get more conservative for this group. Fundamental
risk rises with the threat of a 2023 recession.

Subscriber growth is likely to be less important than content engagement, EBITDA, and profitability.
SVOD may be facing a new chapter of slower growth, higher subscriber churn, and pricing pressure for
Netflix and competitors facing recession. With Netflix subscriber growth stalled at 220.7 million paid
members, Netflix shares are likely to come under greater scrutiny about monetization to accelerate
revenue generation of the industry’s largest customer base. Netflix says competition with linear TV and
VOD providers has increased, and macro headwinds are evident from inflation and lower discretionary
income.

We think the global video streaming wars are intensifying as several notable entrants (such as Disney+,
HBO Max, Peacock, and Paramount+) increasingly take on early movers, such as Netflix, Amazon Prime
Video, and Hulu (Disney 67% ownership and Comcast 33% ownership). It was announced that Disney
would buy the complete share of Comcast by 2024 to have a 100% stake in Hulu for a valuation
estimated at $27.5 billion at that time. Established media companies are also facing direct competition
from Amazon, Apple, Meta, YouTube (Alphabet), and Twitter, which all have their own streaming
platforms.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 12

 NETFLIX TOWERS OVER ALL LINEAR AND SVOD NETWORKS
(TV minutes viewed in the U.S. market in $ billion)
1,600

1,400

1,200

1,000

800

600

400

200

0
Netflix CBC NBC ABC Fox Disney+ Amazon Hulu Apple TV+
Prime
Video

Source: Nielsen.

We see further consolidation in the Movies & Entertainment industry. After a pause in M&A activity across
the media industry amid the pandemic, we see a material pickup ahead. On April 8, the merger closed
between Discovery and AT&T’s WarnerMedia, and Amazon/MGM Studios closed on March 17. So, the
next M&A wave could push the convergence and consolidation to new levels, driven by the need for scale
and content as entertainment companies strategically pivot to their direct-to-consumer (streaming)
offerings and expand distribution and digital capabilities.

Should the leading media companies invest billions in original content or leverage legacy streaming
libraries? We believe it is table stakes to have both original content and licensed content made by other
brands that are watched on a streaming service. We don’t think it’s a “either/or” decision, but one that
depends on a company’s current position. Some of the featured companies in this thematic report have
vast movie and TV libraries. In March 2022, Amazon closed an $8.5 billion acquisition of MGM Studios,
which will bolster Amazon Prime Video’s competitive position. MGM brings nearly a century of
entertainment content through a broad offering of original films and television shows to a global market.

A wealth of options can lead to paralysis of viewership and short attention spans to cut the cord. The
worry for all video service providers is investing billions of dollars in movies and TV shows and not getting
household stickiness for their subscriptions. Across all types of content offerings, whether it be ad-free
SVOD, AVOD, Pay-TV, or multi-channel video programming distributors (vMVPDs), we see compelling
content as the magnet to keep customers. Investment in new, exclusive content appears to be paramount
to retaining subscribers. Showcasing original content matters, but so does having a steady flow of new
releases every month to feed viewer appetites. There have been some surveys like eMarketer that
indicate that one-third of viewers subscribe to a new video service provider just to watch a show
exclusively on that channel and then stay with the subscription.

13 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

 U.S. PAY-TV HOUSEHOLD MARKET
(in million)
80
68.5
70 65.1
62.3
59.7
57.2
60
52.4
50 49.5
46.9
44.6 42.4
40
30
20
10
0
2022a 2023e 2024e 2025e 2026e

Pay TV Households in the U.S. (mil.) % of U.S. households

Source: Roku, eMarketer, February 2022.

The North America market for SVOD may have matured at a time when the competitive landscape is still
shaking out the smaller players. Video streaming has disrupted linear broadcast networks, but SVOD may
not be as profitable as we would like. SVOD is also a fragmented market, where consumers work harder
to find content they like and pay more with several subscriptions. Average customer churn rates in the
U.S. have been consistent since 2020, in the 35%-40% range for pad SVOD services, per a Deloitte
survey in March 2022. The report indicates that U.K., Germany, Brazil, and Japan have an overall churn
rate closer to 30%. These churn rates vary by each country, factoring in SVOD penetration rates and
number of SVOD services.

SUBSCRIPTION VIDEO ON DEMAND SERVICES (SVOD) CHURN

RATES IN U.S. MARKET
Total 24% 33% 4%

Gen Z 24% 46% 5%

Millennials 28% 49% 3%

Gen X 26% 36% 4%

Boomers 20% 12% 5%

Matures 11% 15% 5%

0% 20% 40% 60% 80% 100%

Added more subscriptions
Both added and cancelled subscriptions
Cancelled subscriptions

Source: Deloitte Media Trends (March 2022).

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 14

Digital Advertising Gains Share, Despite the Slower Pace
Global ad spend held up surprisingly well during the pandemic, shrinking only +4.5% in 2020 before
recovering +13.5% in 2021, and is forecasted to be +9% in 2022 and up +6% in 2023, according to
Magna Global and SNL Kagan. Advertising spend across media will slow down with economic
uncertainty, partly offset by organic growth factors to support marketing activity and advertising demand.
Digital advertising will grow +13% in 2022 to reach 65% of total ad sales. Digital video will be the fastest
growing advertising category, up +16%, followed by Search +15% and Social +11%. Traditional linear
networks are getting a growing percentage of advertising revenue from digital formats (AVOD, CTV,
audio streaming, podcasting).

The U.S. advertising market will grow +11% to $326 billion with an expected boost from November mid-
term elections. China, the second largest advertising market, will grow only +8% year-over-year due to
difficulties with Covid-19 variants lockdowns in major cities, slower economic growth, higher inflation, and
stricter regulatory environment for digital media.

Trends such as e-commerce, digital acceleration, and data-driven personalization will be the key growth
drivers for digital advertising in the foreseeable future. Covid-19 forced companies to embrace digital
faster than expected and bumped digital transformation to the top of almost every company’s priority list.
An increasing number of small and mid-size businesses are capitalizing on mobile and social media
advertising to improve engagement with customers. The use of videos and podcasts represented the
fastest growing form of advertising within those platforms. Large companies concerned with online
reputation, however, continue to prefer television advertising to reach their national audiences.

Most recently, developments in the field of data analytics brought about a more effective form of
advertising – personalized advertisements. Advertisers continue to enhance their “mousetraps” by
exploiting algorithms, consumers, and digital footprints to increase personalization and accuracy. While
there are several approaches for ad agencies to owning data (i.e., acquiring large data assets vs.
developing open-data analytics platform), it is their ability to incorporate data management assets into
their operations and ability to assimilate data that will set them apart from competitors.

GLOBAL ADVERTISING BY MEDIA TYPE

(in percent)
2022 2026
Magazines
Radio Magazines
Radio 2.0%
3.3% 1.4%
4.1% Cinema Newspapers
Newspapers 0.2% 2.8% Cinema
4.1% Digital display 0.3%
Digital 3.5%
display
4.3% Outdoor
Outdoor 4.0%
4.1% Internet
Internet
Social search Social search
media ad 35.9% media ad 41.6%
21.5% 25.2%
TV TV
23.8% 18.0%

Source: MAGNA Global, SNL Kagan.

15 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

INDUSTRY TRENDS

The media industry, which encompasses the movies and entertainment, broadcasting, cable and satellite,
advertising, and publishing sub-industries, has long been global. The world’s largest media companies
operate in multiple countries and release content to even more. Comcast's NBCUniversal produces
entertainment, news, sports, and other content for global audiences, as well as owns theme parks
worldwide. France-based Bolloré owns Vivendi, who in turn owns Universal Music Group, game
production company Gameloft, and French pay-TV giant Canal+ Group. Similarly, NBCUniversal owns
and operates Universal theme parks in Florida, California, and Osaka, Japan. Additionally, it licenses the
right to use the Universal Studios brand name and other intellectual property to third parties that own and
operate the Universal Studios theme park in Singapore.

The chart below shows the breakdown of industry revenue by sub-industry. Cable & Satellite is the
largest sub-industry by revenue, with the largest company being Comcast, which generated $121.6 billion
in revenue for the last 12 months ended August 2022. The second largest sub-industry is Movies &
Entertainment, with Disney as the largest company; the company generated $81.1 billion in revenue in
the same period. Unsurprisingly, due to the secular decline in print, the smallest sub-industry is
Publishing, with the largest company being News Corp, which generated revenue of $9.7 billion over the
last 12 months. Combined, the five sub-industries globally generated nearly $790.9 billion of revenue over
the last 12 months.

GLOBAL INDUSTRY REVENUE*

(for LTM through August 15, 2022, in percent)
Publishing
6%

Advertising
15%

Movies &
Entertainment Broadcasting
30% 16%

Cable & Satellite

33%

*Includes companies that are listed on major stock exchanges.

  Source: CFRA, S&P Global Market Intelligence.  

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 16

PROFIT MAPPING

The Movies & Entertainment sub-industry is primarily dominated by U.S. companies, with Disney leading
the pack in industry revenue (37.3%). Netflix overtook Bolloré in the second spot with its revenue
contribution of 14.3% and led the sub-industry with an EBIT margin of 19.1%. We expect to see continual
improvement in EBIT margin as Netflix gradually gains a larger scale but at the expense of lower revenue
as competition rises. French conglomerate Bolloré, a major shareholder of Vivendi, which in turn owns big
names such as Universal Music, Gameloft, and Havas, came in third with a share of revenue of 10.7%
and an EBIT margin of 5.5%.

PROFIT SHARE MAP OF THE MOVIES & ENTERTAINMENT INDUSTRY

(twelve months through August 2022)
25
20
15
10
EBIT Margin (%)

5
0
-5
-10
-15
-20
-25
(Share of Revenue)
Walt Disney Vivendi Tencent Music Cineworld
Bolloré Spotify iQIYI Others
Netflix Warner Music Lions Gate

  Source: CFRA; S&P Global Market Intelligence.

Like the movies & entertainment sub-industry, the broadcasting/cable & satellite sub-industry is also
predominantly led by U.S. companies, which contributed 85% of the $263.9 billion revenue generated by
industry constituents in the last 12 months. Comcast has the highest share of industry revenue (31.4%),
with a commendable industry-leading EBIT margin of 18%. Despite a recent drop due to the effects of the
pandemic, EBIT margin across the broadcasting/cable & satellite sub-industry has been high (touching
20%) compared to other sub-industries due to the consistently higher stream of recurring revenue and
low ongoing investment.  
PROFIT SHARE MAP OF THE BROADCASTING / CABLE & SATELLITE INDUSTRY
(twelve months through August 2022)
25

20
EBIT Margin (%)

15

10

0
(Share of Revenue)
Comcast Fox Sirius XM Charter Comm.
Discovery RTL Group ViacomCBS Altice USA
Others DISH Liberty SiriusXM

  Source: CFRA; S&P Global Market Intelligence.  

17 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

In the advertising sub-industry, Asian companies have recently surpassed their European counterparts in
terms of revenue share at 50.3% and 22.6%, respectively, during the last 12 months. U.S. companies, on
the other hand, took the remaining revenue share of 27.0% during the same period. A major headwind for
the industry is the rapid digital disruption, with clients (especially consumer goods clients) shifting
spending away from the traditional agency-based model towards platforms such as Google and
Facebook while cutting their overall marketing budgets.

PROFIT SHARE MAP OF THE ADVERTISING INDUSTRY

(twelve months through August 2022)
20

15

10
EBIT Margin (%)

-5

-10

-15
(Share of Revenue)

WPP Hakuhodo DY BlueFocus JCDecaux

Publicis Dentsu CyberAgent Others
Omnicom Interpublic Group Advantage Solutions

  Source: CFRA; S&P Global Market Intelligence.

News Corp is the largest publishing company, generating 22.9% of the sub-industry’s revenues.
However, its EBIT margin has been lagging the sub-industry’s average of 10.2%, hurt by the rise of tech
giants such as Google and Facebook. Coming in second is France-based Lagardère, a multinational
publishing and travel retail company. While revenues in its publishing segment had been comparable to
previous year’s, the company’s underperformance in the last 12 months was attributed to a 60% decline
in its travel retail segment (unrelated to publishing) due to the pandemic.  
PROFIT SHARE MAP OF THE PUBLISHING INDUSTRY
(twelve months through August 2022)
14

12

10
EBIT Margin (%)

0
(Share of Revenue)
News Corp John Wiley & Sons China South
Central China Land Media CO.,LTD Lagardère Kadokawa Corp
The New York Times Others Pearson
Jiangsu Phoenix Daily Mail

  Source: CFRA; S&P Global Market Intelligence.  

 

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 18

PORTER'S FIVE FORCES

Porter’s five forces, which provide a framework for industry analysis, were formulated by Michael E.
Porter of Harvard Business School in 1979. In the matrix below, we describe the five parameters on
which an industry can be analyzed and how these apply to the sub-industries of the broader Media &
Entertainment industry.

MEDIA & ENTERTAINMENT PORTER’S COMPETITIVE MATRIX

COMPETITIVE CUSTOMER SUPPLIER
THREAT OF THREAT OF NEW
RIVALRY AMONG BARGAINING BARGAINING
SUBSTITUTION ENTRY
EXISTING FIRMS POWER POWER

Very High - High - Bargaining Moderate - Suppliers in High - Consumers can Low - Barriers to entry
Competitive rivalry power of customers is the industry include choose from multiple into the industry are
among the top firms is high in the movies and "creative talent" (i.e., entertainment video relatively high, as the
intense. Streaming is entertainment industry. writers, producers, providers, such as industry is dominated by
becoming a prevalent The broad availability of actors) and production multichannel video established companies
form of consuming substitutes increases companies that firms in programming with a significant
entertainment video. As consumers' bargaining this industry license distributors (MVPDs), presence in filmmaking.
the "content arms race" power. Consumers can programming from. The internet-based content The high financial outlay
intensifies, more and easily choose from an license for popular providers (including needed for content
MOVIES & more companies are extensive selection of programming from other those that provide production also
ENTERTAINMENT creating or merging programming and content providers may pirated content), video prevents poorly funded
content to rival streaming services, and also be at risk of being gaming providers, and new entrants from
streaming giants even other sources of pulled from streaming DVD retailers. Other entering the industry.
Netflix’s and Amazon entertainment. platforms. sources of
Prime’s spending on entertainment that
content production, and consumers could
this could further choose in their leisure
intensify competition in are also substitutes to
the industry. the industry's products
and services.

High - Competitive Moderate - Industry Moderate - Production High - Consumers can Low - The big players
rivalry is high between players generate companies are the choose from multiple maintain high levels of
broadcasters to revenue primarily from major suppliers of entertainment sources capex in purchasing
purchase broadcasting the distribution and content for such as multichannel rights to the most
rights for the most licensing of their broadcasters. Their video programming popular content, making
popular programming programming and from bargaining power distributors (MVPDs), it difficult for new
and sporting events. advertisements. typically depends on the internet-based content entrants to secure the
Players within the Distributors increasingly quality and popularity of providers (including rights to these
market are typically demand higher-quality content. pirated content programs. New entrants
BROADCASTING/
large, owning multiple and differentiated providers), video also need to ensure that
CABLE &
television channels, programming, while the gaming providers, and they comply with
SATELLITE
resulting in high levels bargaining power of the DVD retailers. Other regulations as
of assets owned, with buyers of advertising sources of monitored by the FCC
high fixed and exit depends on how wide entertainment that in the U.S and local
costs. The rivalry is the audience of the consumers could regulators in other
more significant broadcast network is. choose in their leisure countries.
between players that are also substitutes for
broadcast shows and the industry's products
events of similar and services.
genres.

High - Competitive Moderate - Contracts High - Premium ad Moderate - There is no Low - Client
rivalry among are typically long-term spaces are limited, and absolute substitute for engagements are
advertising firms is high. with static fee demand is typically an ad campaign. typically based on long-
Each ad campaign aims structures. Clients are more than supply. However, newer term relationships.
to increase sales, build generally large and can Seasonal campaigns technologies such as e- Attracting and retaining
credibility, and budgets demand concessions. put further pressure on commerce and social creative talent is
are usually large. Firms However, the supply. Product media tools offer new expensive and time-
are expected to produce prominence of the client launches require better channels for forward- consuming. It is
ADVERTISING results or risk losing the can add prestige to the integration with the integration with low challenging to attain
client to a competitor. advertising firm. supplier. switching costs. deep connections with
Competition is regional demographics,
intensified as tech behaviors, attitudes,
giants such as Google and values. New
and Facebook dominate entrants will also have
digital advertising, constraints in getting
which has a broader access to key media
reach and lower costs. channels or space.

Source: CFRA.

19 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

MEDIA & ENTERTAINMENT PORTER’S COMPETITIVE MATRIX (CONTINUED)
COMPETITIVE
CUSTOMER SUPPLIER THREAT OF THREAT OF NEW
RIVALRY AMONG
BARGAINING POWER BARGAINING POWER SUBSTITUTION ENTRY
EXISTING FIRMS

High - Competitive Moderate - Moderate - Suppliers in Moderate - A major Low - It is difficult and
rivalry among Intermediate customers the industry are printers, headwind facing the time-consuming for new
publishers centers (i.e., bookshops and typesetters, freelancers, industry is the decline in entrants to grow their
principally on sales, other retailers) and end and authors. Except for reading as people are size and reputation
titles, and authors, customers (i.e., authors, bargaining busier, and perhaps sufficiently to compete
resulting in publishers readers) are power of the other more distracted, today. with the larger players.
being unable to earn increasingly more suppliers is low as there Although there have However, a smaller
high profit margins, as powerful. The main is plenty of supply. For been cases of unknown publisher can set up
the biggest publishers customer for most fiction books, best- writers who resorted to and run in just a few
all have the capabilities publishers is Amazon, selling authors have e-book distribution years and at a relatively
to capture these three which leverages its significant bargaining platforms and were low cost.
things. A publisher is dominant position as an power over publishers, successful, publishers
PUBLISHING
unable to charge higher e-commerce giant. while for much non- still add value by
prices for their books Nonetheless, publishers fiction, any potential offering professional
and must benchmark that have a highly expert could write the editing and marketing
the price to their rivals. anticipated book on book, resulting in lower services that enhance
Acquiring new titles and their frontlist have bargaining power. With the quality of the works
authors typically results higher bargaining the growing popularity and can boost sales.
in bidding wars that hurt power. of e-books, authors can Publishers must deal
all the parties involved. publish their work with people
independently without downloading pirated
having to go through the e-books from numerous
strict selection process websites offering them
of traditional editors. for free.

Source: CFRA.
 

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 20

 Operating Environment
The media industry is intensely competitive and has a high degree of ownership concentration, with a
disproportionately large share of the assets controlled by a few conglomerates. The competitive
landscape has been shaped by several waves of industry consolidation across various areas of the value
chain, which have further intensified over the past decade.
DIVERSIFIED MEDIA AND ENTERTAINMENT COMPANIES

TYPE OF BUSINESS AT&T^ COMCAST^^ CHARTER DISCOVERY^^^ DISNEY* FOX** LIBERTY LIONSGATE*** NETFLIX¬ SONY VIACOMCBS~¬ VERIZON
Basic cable network(s) ■ ■ ■ ■ ■ ■ ■ ■
Book publishing ■ ■ ■ ■
Broadcast TV network(s) ■ ■ ■ ■ ■
Broadcast TV station(s) ■ ■ ■ ■
Cable/fiber video & broadband service ■ ■ ■ ■
E-commerce ■ ■ ■
Film production/library ■ ■ ■ ■ ■ ■ ■
Home entertainment ■ ■ ■ ■ ■ ■ ■ ■
Internet/streaming audio ■
Internet/streaming video ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Live events/sports ■ ■ ■ ■
Magazines/newspapers ■
Merchandise licensing ■ ■ ■ ■ ■ ■ ■
Premium cable network(s) ■ ■ ■
Radio stations/networks ■ ■
Recorded music label(s) ■ ■
Satellite radio broadcasting ■
Satellite TV broadcasting ■ ■
Theme parks/resorts ■ ■
TV production/library ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Video games/Interactive ■ ■ ■ ■ ■ ■ ■ ■
Wireless phone service ■ ■ ■ ■
Wireline phone service ■ ■ ■ ■
Note: Some relatively minor operations may be excluded. Includes significant equity interests in joint ventures or other companies.
^Acquired DIRECTV (July 2015) and Time Warner (July 2018)
^^Acquired Sky (October 2018)
^^^Acquired Scripps Networks (March 2018)
*Acquired 21st Century Fox (March 2019)
**Spun from 21st Century Fox (March 2019)
***Acquired Starz (December 2016)
~Acquired Next Games (March 2022)
~¬Viacom/CBS merger (December 2018)
Source: CFRA Equity Research, company reports.

Data, Analytics, and Content Will Be Post-Pandemic M&A Drivers

The impact of Covid-19 was significant and immediate for media companies, not just at an operational
level but also on a commercial one. While some consequences were short-term, others were more
longer-lasting and could potentially alter the future of the industry. The number of M&A deals within the
media & entertainment industry had been booming since the 2008 recession – that is, until the global
pandemic took center stage in 2020. However, 2021 saw a proliferation in M&A activity. According to
PricewaterhouseCoopers (PwC), deal counts demonstrated continued optimism in 2021 amid an uptick in
confidence as industry disruptions and huge opportunities from digitization and technology, combined
with the availability of capital, spurred a robust M&A trend in 2021. The consolidation of studios and
networks will continue in 2022, albeit at a much slower pace, as the world’s major economies continue to
raise interest rates to tame blistering inflation, ceaseless war in Ukraine, and stock market turned bearish
in fear of recession. The global M&A activity of media and entertainment industry deal value shrunk in half
for the first half of 2022 compared to the second half of 2021, plummeting from $215.5 billion to $105.1
billion in the first half of 2022, according to Refinitiv.

Despite the uniqueness of this crisis, it does share many common features with previous recessions. One
is the acceleration of underlying industry trends, i.e., the explosion of streaming. According to data
compiled by Deloitte Center for Technology, Media & Telecommunications, at least 80% of U.S.
consumers subscribed to at least one video streaming platform post-Covid-19 start, compared to just 49%
merely three years ago. To remain competitive and to keep users glued to their screens, streaming
service providers have consistently joined forces through mergers and acquisitions to combine assets or
invest in the acquisition of content (or companies that produce/own the content).

21 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

 VOLUME OF SCRIPTED ORIGINAL TV SHOWS*
(number of scripted origital TV shows)
600 559
532
487 495 493
500 455
422
389
400 349
288
300

200

100

0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

*Including dramas and sitcoms across all traditional networks and digital platforms.
Source: FX Networks.

Content creation aside, the increased use of consumer analytics and data generation to drive growth in
the past few years has been staggering. Media companies today rely on such data to differentiate
themselves and to stand out to advertisers by offering more targeted advertisements, thereby significantly
increasing their clients’ conversion rates. Companies would therefore look to invest (or acquire) more
advanced analytics and data technologies that will help them achieve this goal.

Advertising with higher take rate for streaming versus broadcast is critical, in our opinion. Just in the past
five years, we have seen consumer TV time spend on streaming grow from 23% to 50% of total TV
viewing time. Advertising by marketers has lagged with TV ad budget spend growing from 6% to 22%.
Recession poses a near-term risk for TV advertising budgets shifting to streaming. Roku cited on its
earnings call that a survey by Advertiser Perceptions indicated that 47% of total advertisers in the U.S.
say they made second quarter pauses on ad spending for TV streaming, with 44% on digital video, and
42% on legacy pay-TV. We think the second half of 2022 advertising spend will be hurt by weaker
consumer spending, rising interest rates, and inflation pressures.

OPPORTUNITY GAP BETWEEN TV STREAMING VS. ADVERTISING BUDGETS

(in percent)
0.6

0.5 0.5
0.45
0.4 0.4

0.3 0.3
0.23 0.22
0.2
0.18
0.13
0.1
0.06 0.08
0
2018 2019 2020 2021 2022
Consumer TV time spent on streaming
Marketers TV ad budgets spent on streaming

Source: Roku, Nielsen in Q2 2022 for TV time streaming, eMarketer, 2022 advertisers spend on
streaming.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 22

The table below highlights all major M&A transactions in the pipeline and in recent years for the media &
entertainment industry:

MAJOR GLOBAL M&A ACTIVITIES*

(arranged by completion year and transaction size, in $, millions)

COMPLETION IMPLIED
ACQUIRER TARGET SIZE
DATE EV/EBITDA
Pending Rogers Communications Shaw Communications 21,278 11.5
Pending Keppel Pegasus Singapore Press Holdings 5,133 32.3
Pending Télévision Française 1 Métropole Télévision 2,892 6.9
Pending Penguin Random House Simon & Schuster 2,175 -
Pending HYBE America Ithaca Holdings 1,050 -
2022
4/11/2022 iliad S.A. UPC Polska Sp. z o.o. 1,896 9.3
3/17/2022 Amazon.com MGM Holdings 8,500 33.5
2/22/2022 Santa Ana Inc; Najafi Companies TEGNA 8,714 11.9
Content and Media Assets of Grupo
1/31/2022 Univision Communications Televisa, S.A.B.
4,800 -
2021
2/10/21 Vodafone Vierte Verwaltungs Kabel Deutschland 10,488 9.6
8/2/21 Platinum Equity McGraw-Hill Education 6,742 16.6
5/10/21 Insig AI Plc Catena Group plc 3,726 -
8/10/21 Pershing Square Universal Music Group 2,800 -
12/1/2021 Gray Television Meredith Corporation 2,700 5.5
1/7/21 Scripps Media ION Media Networks, Inc. 2,650 8.2
4/19/21 Morgan Stanley Infrastructure Tele Columbus 2,439 9.8
10/19/2021 Penn National Gaming Score Media and Gaming 2,017 -
7/9/21 Madison Square Garden MSG Networks 2,006 5.7
8/2/21 The Stagwell Group Stagwell Inc. 1,619 6.8
8/9/21 Funimation Global Group Crunchyroll 1,175 -
2020
4/30/20 KKR & Co. Axel Springer 14,644 18.4
7/3/20 Banijay Group Endemol Group 9,204 -
10/13/20 TV Bermuda Central European Media Enterprises 8,800 8.1
4/24/20 UNEEQO, Inc UNEEQO, Inc. 5,800 -
12/30/20 VRG Bidco Village Roadshow 4,262 50.1
11/6/20 - The New York Metropolitan Baseball 2,450 -
*Transactions above $1 billion.
Sources: CFRA, S&P Global Market Intelligence.

Diverging Recovery Paths Across Industry Segments

We expect various media and entertainment industry segments to show diverging paths to a potential
recovery from the Covid-19 pandemic amid the reopening of the economy. Certain sections of traditional
advertising (e.g., outdoor, radio, and TV) have already begun to show some early signs of a gradual
recovery to varying degrees and speeds despite some may believe that traditional advertising is on the
death door. During the Covid-19 pandemic, consumers shifted so much into the online world that they are
growing numb to the constant stream of online advertising and messaging and react more positively to
traditional print and television advertisements, according to a 2022 article by Harvard Business Review.

Conversely, the accelerated adoption of digital tools amid Covid-19 may slow the recovery of various out-
of-home entertainment such as theaters, live events, sports, concerts, and theme parks. Some
consumers may avoid being in crowded places even after immunization due to the emerging Omicron
variant, while others may take some time to break out of their cozy home routines. Nonetheless, we still
anticipate a gradual recovery to pre-pandemic levels for companies in these sectors.

23 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

Competitive Environment
Amid continued secular shifts in media consumption, fueled partly by the ongoing coronavirus pandemic, a
growing number of cloud-based offerings across the media industry have sprouted over the past few years,
spurring increased adoption into the mainstream population. In general, media companies are leveraging
cloud-based offerings toward creating additional touch points for their products and services, and toward
fostering customer acquisition and retention, as well as consumer engagement. In many cases, such
offerings are also motivated by a quest for operating efficiencies and economies of scale.

On the video side, the past few years have seen growing popularity of the cloud-based OTT video service –
an internet distribution model that bypasses traditional pay-TV providers. Netflix is the world’s most popular
streaming video provider, with a user interface for streaming thousands of movies and TV shows for a
monthly subscription. Other OTT players include Amazon Prime Video and Hulu. There are more than 200
OTT video services in the U.S., according to Park Associates. Most of the services, however, are evolving to
be complementary to the market’s biggest players instead of competing against them. There has also been
an increase in partnerships with and among OTT video services due to factors such as the low threshold for
survival, success of bundling, content fragmentation, polarization in the subscription market of OTT, and low
awareness of smaller OTT brands.

Video streaming can get quite expensive for U.S. households subscribing to multiple plans. The annual
pricing from the major video providers ranges from $50 to $240 per plan. While it’s true the maximum
viewer profiles are five to seven persons, not always at the same address, the principal person who is
paying for all the subscriptions is likely to ask, do we need all these streaming services? We believe this
is why the subscriber churn rate is high and has a negative impact on net subscriber additions as well as
average revenue per subscriber.

Leading video streaming providers offer both advertising streaming and ad-free services. Annualized
subscription costs can get expensive, especially when using more than one or two streaming services.
Most plans also offer download availability. Paramount+ Essential (ads) and Peacock Premium (ads) are
the most affordable plans at $4.99 monthly, or $99.99 annual pricing. Maximum viewer profiles seem very
generous, with most services offering five to seven viewers in the same household, or friends and family.
Netflix is trying to monetize more subscription revenue by charging those persons not residing at the
same address. The company will introduce AVOD subscriptions at lower rates starting in 2023 to
complement the ad-free monthly plans.

INDUSTRY SURVEYS MEDIA & ENTERTAINMENT / SEPTEMBER 2022 24

 SELECT SVOD SERVICE PROVIDERS, SUBSCRIPTION TIERS, SAMPLE PRICING  
 
Monthly Annual Maximum Maximum
pricing pricing viewer concurrent Download
SVOD Service Subscription tiers ($) ($) profiles streams availability

Amazon Prime Amazon Prime Video (partial

Video ads) 8.99 107.88 6 3 Yes

Apple TV+ Apple TV+ (ad-free) 4.99 59.88 6 6 No

Discovery+ Discovery+ (ads) 4.99 59.88 5 5 No

Disney+ Discovery+ (ad-free) 6.99 83.88 5 5 No

Disney+ (ads) - launch

Disney+ December 7.99 79.99 7 4 Yes

Disney+ Disney+ (ad-free) 10.99 109.90 7 4 Yes

HBO Max HBO Max (ads) 9.99 119.88 5 3 Yes

HBO Max (ad-free) 14.99 179.88 5 3 Yes

Hulu Hulu (ads) 6.99 83.88 6 2 Yes

Hulu (ad-free) 12.99 155.88 6 2 Yes

Netflix Basic (ad-free) 9.99 119.88 5 1 Yes

Standard (ad-free) 15.49 185.88 5 2 Yes

Premium (ad-free) 19.99 239.88 5 4 Yes

Paramount+ Essential (ads) 4.99 49.99 6 3 Yes

Premium (ad-free) 9.99 99.99 6 3 Yes

Peacock Premium Peacock Premium (ads) 4.99 49.99 6 3 Yes

Peacock Pemium Plus (ad-

free) 9.99 99.99 6 3 Yes

Source: SNL Kagan.             

 

25 MEDIA & ENTERTAINMENT / SEPTEMBER 2022 INDUSTRY SURVEYS

Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Recommendation Price 12-Mo. Target Price Report Currency Investment Style
BUY « « « « « USD 93.57 (as of market close Mar 10, 2023) USD 135.00 USD Large-Cap Value
Equity Analyst Kenneth Leon

GICS Sector Communication Services Summary This media and entertainment conglomerate has diversified global operations in theme
Sub-Industry Movies and Entertainment parks, filmed entertainment, television broadcasting, and consumer products.

Key Stock Statistics (Source: CFRA, S&P Global Market Intelligence (SPGMI), Company Reports)
52-Wk Range USD 144.46 - 84.07 Oper.EPS2023E USD 4.25 Market Capitalization[B] USD 175.63 Beta 1.30
Trailing 12-Month EPS USD 3.46 Oper.EPS2024E USD 5.80 Yield [%] N/A 3-yr Proj. EPS CAGR[%] 20
Trailing 12-Month P/E 27.04 P/E on Oper.EPS2023E 22.02 Dividend Rate/Share N/A SPGMI's Quality Ranking A
USD 10K Invested 5 Yrs Ago 9,187.0 Common Shares Outstg.[M] 1,826.00 Trailing 12-Month Dividend N/A Institutional Ownership [%] 64.0

Price Performance Analyst's Risk Assessment

LOW MEDIUM HIGH

Our views reflect execution risk on managing a complex
company with capital intensive businesses in movies &
entertainment, Disney Parks, and linear networks for
broadcast networks and pay-TV offerings. We think
investors are concerned about whether DIS management
can successfully execute its subscription video on demand
(SVOD) start ups (Disney+, ESPN+ and Hulu) for direct to
consumer (DTC) markets. The holy grail is whether core
Disney+ can achieve positive operating income by the end
of FY 24 with a lowered 135m-165m subscriber target.
DIS may raise SVOD pricing across all subscription rate
plans.

Revenue/Earnings Data

Revenue (Million USD)

1Q 2Q 3Q 4Q Year
2024 -- -- -- -- E 97,500
Source: CFRA, S&P Global Market Intelligence
2023 23,512 -- -- -- E 90,600
Past performance is not an indication of future performance and should not be relied upon as such.
2022 21,819 19,249 21,504 20,150 82,722
Analysis prepared by Kenneth Leon on Feb 09, 2023 09:38 AM ET, when the stock traded at USD 111.78.
2021 16,249 15,613 17,022 18,534 67,418
2020 20,858 18,044 11,779 14,707 65,388
Highlights Investment Rationale/Risk
2019 15,303 14,922 20,262 19,100 69,570
u We see total revenue of $90.6b in FY 23 (Sep.) u We think DIS can move faster with refined
Earnings Per Share (USD)
and $97.5b in FY 24, following $82.7b in FY 22, strategy, cost cutting, and Bob Iger leading the
benefiting from a rebound of the theme parks/ company. Release had new $5.5b cost reduction 1Q 2Q 3Q 4Q Year
experiences and the content sales/licensing plan, $3b reduction in current $30b (prior $36b) 2024 E 1.25 E 1.65 E 1.30 E 1.60 E 5.80
businesses. We see flat to modest growth from content spend, commitment to rebalance focus 2023 0.99 E 1.01 E 1.30 E 0.95 E 4.25
media advertising and affiliate license revenue, in linear and streaming networks, and delight 2022 1.06 1.08 1.09 0.30 3.53
while streaming revenue accelerates. guests at parks. There are no signs of weakness 2021 0.32 0.79 0.80 0.64 2.55
u In Q1 FY 23, DIS delivered 8% Y/Y revenue in parks with 25% revenue growth. We think Mr. 2020 1.53 0.60 0.08 -0.20 2.02
growth led by strength in Disney Parks with Iger will look to better harmonize DIS assets in 2019 1.84 1.61 1.35 1.07 5.77
reopening realized 25% Y/Y increase in revenue movies, TV programming, and distribution to Fiscal Year ended Sep 30. EPS Estimates based on CFRA's
and $3.1b operating income versus $2.5b a year attain higher EBITDA / profitability. Cable pay TV Operating Earnings; historical earnings are adjusted. In periods
ago. New revenue catalysts in FY 23 are Black (including ESPN) and ABC network are key where a different currency has been reported, this has been
businesses in generating operating cash. adjusted to match the current quoted currency.
Panther: Wakanda Forever, Avatar: The Way of
Water, Marvel films, Ant-Man and the Wasp: u Risks are recession, lack of return of capital,
Dividend Data
Quantumania, and Guardians of the Galaxy and no signs of Disney+ improving.
Volume 3. Avatar realized $2.2b global revenue u DIS has more pragmatic plan with $6b Amount Date Ex-Div. Stk. of Payment
to date. restructuring, lower content spend, and better ( USD) Decl. Date Record Date
u Linear Networks (pay TV and broadcast) curation of content distribution among linear 0.8800 Dec 04 Dec 13 Dec 16 Jan 16 '20
delivered a -5% revenue decline Y/Y and a -16% and streaming units. We raised our target by 0.8800 Jun 26 Jul 05 Jul 08 Jul 25 '19
decline in operating profit due to lower $25 to $135, forward TEV/EBITDA of 18.3x, 0.8800 Nov 28 Dec 07 Dec 10 Jan 10 '19
advertising revenue, foreign exchange pressure, below 5-year historical average of 22.0x. We 0.8400 Jun 26 Jul 06 Jul 09 Jul 26 '18
and higher programming costs, offset by higher raised our EPS estimates by $0.25 in both FY 23
Dividends have been paid since 1971 . Source: Company reports
results in Cable. Disney+ showed 104.3m (Jun.) to $4.25 and FY 24 to $5.80. What to do
Past performance is not an indication of future performance
subscribers, net gain of +1.4m subscribers Y/Y. with Hulu, where DIS may purchase remaining and should not be relied as such.
Average revenue per paid subscriber was -3% to 33% interest from Comcast or sell its majority Forecasts are not a reliable indicator of future performance.
$5.77 per sub and Disney+ Hotstar (India) interest by 2024, will be key decision for Mr. Iger Dividends paid in currencies other than the Trading currency have
showed a -6% decline in subscribers to 57.3m and the board of directors. been accordingly converted for display purposes.
and ARPU $0.74 versus $0.58 a year ago.

Redistribution or reproduction is prohibited without written permission. Copyright © 2023 CFRA. This document is not intended to provide personal investment advice and it does not take into account the specific investment
objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek independent financial advice regarding the suitability and/or appropriateness of making an investment
or implementing the investment strategies discussed in this document and should understand that statements regarding future prospects may not be realized. Investors should note that income from such investments, if any,
may fluctuate and that the value of such investments may rise or fall. Accordingly, investors may receive back less than they originally invested. Investors should seek advice concerning any impact this investment may have on
their personal tax position from their own tax advisor. Please note the publication date of this document. It may contain specific information that is no longer current and should not be used to make an investment decision. Unless
otherwise indicated, there is no intention to update this document.
1
Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Business Summary Feb 09, 2023 Corporate information

CORPORATE OVERVIEW. The Walt Disney Company (DIS) is a leading and diversified media and entertainment Investor contact
conglomerate with key operations in theme parks, television, filmed entertainment, direct-to-consumer, and A. S. Quadrani (818 560 1000)
other businesses.
The Disney Media and Entertainment Distribution (DMED) segment (66% of FY 22 [Sep.] revenues and 35% Office
of total segment operating income) is comprised of the linear networks; direct-to-consumer (DTC); and 500 South Buena Vista Street, Burbank, California, 91521
content sales/licensing businesses. Linear networks include the ABC branded broadcast network and eight
Telephone
TV stations; branded domestic cable networks ESPN (80%-owned), The Disney Channel, Freeform and
818 560 1000
National Geographic; TV production and distribution; National Geographic magazines; and a 50% equity
investment in A+E TV Networks); branded international networks (Disney, ESPN, Fox, National Geographic Fax
and Star); and equity investments including Endemol Shine (50%-owned); Seven TV (20%); Tata Sky (30%), N/A
and Vice (21%). DTC includes the streaming services (Disney+, ESPN+, Hotstar, Hulu). Content sales/
licensing includes the film, television, and home video businesses under the Walt Disney, Twentieth Century Website
Fox, Marvel, Lucasfilm, Pixar, Fox Searchlight, and Blue Sky Studios banners; live entertainment events; and www.thewaltdisneycompany.com
music. In March 2019, the company acquired certain entertainment assets of Twenty-First Century Fox (as
further discussed below). Officers
The Disney Parks, Experiences and Products (DPEP) segment (34% of FY 22 revenues and 65% of total Senior EVP & CFO Senior EVP & General
segment operating income) is comprised of the domestic theme parks (Disney World and Disneyland parks C. M. McCarthy Counsel
in Orlando, FL, and Anaheim, CA, respectively); international theme parks (Euro Disney, Paris (39%-owned); H. E. Gutierrez
Hong Kong Disneyland (43%-owned); Shanghai Disney Resort (43%-owned), which opened in June 2016; CEO & Director
Tokyo Disney Resort (licensed); the Disney Cruise Line; Disney Vacation Club; and consumer products R. A. Iger Independent Chairman of
businesses (comprised of merchandise licensing and retail stores in North America (200 stores), Europe the Board
(80), Japan (50), and China (2). S. E. Arnold
IMPACT OF SIGNIFICANT DEVELOPMENTS. In March 2019, after an earlier bidding war against Comcast,
Disney closed its acquisition of certain entertainment assets of Twenty-First Century Fox for about $71.3 Board Members
billion in a 50/50 cash-and-stock transaction. That deal included Fox’s film/television assets; FX and A. L. Chang M. B. Froman
National Geographic channels, the regional sports networks, Fox international networks, and STAR India; as C. N. Everson M. E. Lagomasino
well as FOX’s minority stakes in Hulu (30%) and Sky Plc. (39%).
C. R. McDonald M. G. Parker
CORPORATE STRATEGY. As a major content provider, DIS’s top strategic priorities include creativity and
innovation, international expansion, and leveraging new technology applications. Under CEO Robert Iger, DIS D. W. Rice M. T. Barra
has been making its content available across various digital platforms (broadband, wireless/mobile -- F. A. deSouza R. A. Iger
including iTunes, iPhone/iPad, Netflix, and Amazon -- and video games). G. E. Knell S. A. Catz
More recently, the company has increasingly pivoted to a direct-to-consumer strategy with three-pronged I. V. Tavrin S. E. Arnold
subscription-based and/or ad-supported streaming offerings comprised of Disney+ (which launched in
J. Landgraf
November 2019), ESPN+ (launched in April 2018), and Hulu (full control acquired with the Fox deal). As of
December 31, 2022, the streaming subscriber counts were Disney+, 104.3 million; ESPN+, 24.9 million;
Hulu, 48.0 million; and Hotstar, 57.5 million. Domicile Auditor
In September 2017, the company paid $1.5 billion for an additional 42% stake in BAMtech, a video streaming Delaware PricewaterhouseCoopers
company previously formed by Major League Baseball (MLB), raising its stake to 75%. Earlier, in August LLP
Founded
2016, the company acquired its initial 33% stake in BAMTech for about $1 billion. In 2014, DIS acquired
1923
Maker Studios, a digital content network on YouTube, for up to $950 million. In 2012, DIS acquired Lucasfilm
(and the StarWars franchise) for $4.06 billion in cash and stock. Other key acquisitions included Marvel Employees
(acquired in 2009 for about $4 billion in cash and stock) and Pixar (acquired in 2006 for $7.4 billion in 188,100
stock).
FINANCIAL TRENDS. As of October 1, 2022, total debt to total capital ratio on a last twelve month basis was Stockholders
30.9% compared to 36.3% in FY 21 and 39.0% in FY 20. EBITDA/interest expense ratio was 8.5x at quarter N/A
end versus 6.4x in both FY 21 and FY 20. EBITDA margins in Q4 FY 22 was 9.2% versus 8.2% in FY 21 and
9.2% in FY 20. For the full year ending October 1, 2022, cash provided by operations rose $6.0 billion and
free cash flow was 1.06 billion with $3.5 billion investment in parks, resorts and other property like DTC
streaming including Disney+ and other major projects. With $48.3 billion debt and $11.6 billion cash, DIS
does not pay a dividend. Cash was $8.5 billion at December 31, 2022.
Price increases were put into effect for ad-free Disney+ to $10.99 from $7.99. The Disney+ bundle with ad-
free ESPN+ and Hulu remains at $19.99 monthly. A new ad-pay SVOD is being started at $7.99 in the U.S.
first, with international in 2023. We think market penetration in India (38% of Disney+ subscribers) may be a
challenge since it did not get the major cricket league rights.
On November 20, 2022, DIS board of directors announced Robert Iger to return as CEO replacing Bob
Chapek, who stepped down from his position. We think the board of directors was disappointed with the
recent results and the last investor call on Q4 FY 22 results and the FY 23 outlook. Instead of choosing a
new leader outside of the DIS culture, the board chose a known executive in Iger, who was the company’s
CEO from 2005 to 2020. The strategic and execution challenges facing Iger today are very different than the
opportunities and growth plans he achieved in his last CEO tenure.
On FY 24 Disney+ guidance, DIS said on the investor call that it will achieve profitability in FY 24. Core Disney
+ subscriber target range is 135 million to 165 million by the end of FY 24. Management’s updated
subscriber guidance for Disney+ Hotstar was up to 80 million subscribers in India by the end of fiscal 2024.
DIS did not proceed with the expensive Indian Premier League digital rights. We think DIS should downsize
or exit Hotstar given limited revenue opportunity with low rate plans ($0.74 monthly ARPU).

Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 2
Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Quantitative Evaluations Expanded Ratio Analysis

Fair Value Rank 1 2 3 4 5 2022 2021 2020 2019

Lowest Highest Price/Sales 2.08 4.77 3.39 3.11
Based on CFRA's proprietary quantitative model, Price/EBITDA 14.37 37.40 24.28 13.37
stocks are ranked from most overvalued (1) to most Price/Pretax Income 32.61 125.63 NM 15.55
undervalued (5). P/E Ratio 26.72 75.62 60.67 22.52
Avg. Diluted Shares Outstg. (M) 1,827.00 1,828.00 1,808.00 1,666.00
Fair Value USD Analysis of the stock’s current worth, based on CFRA’s
Calculation 93.83 proprietary quantitative model suggests that DIS is Figures based on fiscal year-end price
undervalued by USD 0.26 or 0.28%

Volatility LOW AVERAGE HIGH

Key Growth Rates and Averages
Technical NEUTRAL Since January, 2023, the technical indicators for DIS
Past Growth Rate (%) 1 Year 3 Years 5 Years
Evaluation have been NEUTRAL"
Net Income 57.64 NM NM
Insider Activity UNFAVORABLE NEUTRAL FAVORABLE Sales 22.70 5.92 8.45

Ratio Analysis (Annual Avg.)

Net Margin (%) 3.80 0.79 7.89
% LT Debt to Capitalization 28.20 30.51 27.96
Return on Equity (%) 3.37 1.16 8.70

Company Financials Fiscal year ending Sep 30

Per Share Data (USD) 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013
Tangible Book Value 1.25 -3.65 -7.34 -8.12 7.19 1.91 5.33 5.74 5.65 6.05
Free Cash Flow 0.59 1.10 1.99 1.04 6.56 5.56 5.13 4.20 3.72 3.71
Earnings 1.75 1.11 -1.57 6.26 8.36 5.69 5.73 4.90 4.26 3.38
Earnings (Normalized) 3.53 2.33 2.02 5.77 7.08 5.70 5.72 5.15 4.32 3.39
Dividends N/A N/A N/A 1.76 1.72 1.62 1.49 1.37 1.15 0.86
Payout Ratio (%) NM NM NM 26.19 19.96 27.23 24.63 36.54 20.10 21.58
Prices: High 179.63 203.02 153.41 147.15 117.90 116.10 120.65 122.08 91.20 67.89
Prices: Low 90.23 117.23 79.07 100.35 96.80 90.32 86.25 78.54 63.10 46.53
P/E Ratio: High 50.90 87.20 75.90 25.50 16.70 20.40 21.10 23.70 21.10 20.00
P/E Ratio: Low 25.60 50.40 39.10 17.40 13.70 15.80 15.10 15.30 14.60 13.70

Income Statement Analysis (Million USD)

Revenue 82,722 67,418 65,388 69,607 59,434 55,137 55,632 52,465 48,813 45,041
Operating Income 6,832 3,492 3,781 12,030 14,837 13,873 14,487 13,224 11,540 9,450
Depreciation + Amortization 5,163 5,111 5,345 4,167 3,011 2,782 2,527 2,354 2,288 2,192
Interest Expense 1,549 1,546 1,647 1,246 682.00 507.00 354.00 265.00 294.00 349.00
Pretax Income 5,285 2,561 -1,743 13,923 14,729 13,788 14,868 13,868 12,246 9,620
Effective Tax Rate 32.80 1.00 -40.10 21.70 11.30 32.10 34.20 36.20 34.60 31.00
Net Income 3,145 1,995 NM 11,054 12,598 8,980 9,391 8,382 7,501 6,136
Net Income (Normalized) 3,506 1,372 1,456 6,434 8,383 8,227 9,072 8,213 7,044 5,688

Balance Sheet and Other Financial Data (Million USD)

Cash 11,615 15,959 17,914 5,418 4,150 4,017 4,610 4,269 3,421 3,931
Current Assets 29,098 33,657 35,251 28,124 16,825 15,889 16,966 16,758 15,169 14,109
Total Assets 203,631 203,609 201,549 193,984 98,598 95,789 92,033 88,182 84,141 81,241
Current Liabilities 29,073 31,077 26,628 31,341 17,860 19,595 16,842 16,334 13,292 11,704
Long Term Debt 45,299 48,540 52,917 38,129 17,084 19,119 16,483 12,773 12,631 12,776
Total Capital 160,637 160,537 159,835 149,989 74,829 71,443 67,493 65,991 62,973 62,532
Capital Expenditures 4,943 3,578 4,022 4,876 4,465 3,623 4,773 4,265 3,311 2,796
Cash from Operations 6,010 5,567 7,618 6,606 14,295 12,343 13,136 11,385 9,780 9,452
Current Ratio 1.00 1.08 1.32 0.90 0.94 0.81 1.01 1.03 1.14 1.21
% Long Term Debt of Capitalization 28.20 30.20 33.10 25.40 22.80 26.80 24.40 19.40 20.10 20.40
% Net Income of Revenue 3.80 3.00 -4.40 15.90 21.20 16.30 16.90 16.00 15.40 13.60
% Return on Assets 2.10 1.08 1.19 5.14 9.54 9.23 10.05 9.59 8.72 7.57
% Return on Equity 3.40 2.50 -2.40 13.90 26.10 20.00 20.40 18.30 16.60 14.70

Source: S&P Global Market Intelligence. Data may be preliminary or restated; before results of discontinued operations/special items. Per share data adjusted for stock dividends; EPS diluted.
E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked. UR-Under Review.

Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 3
Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Sub-Industry Outlook Industry Performance

We have a neutral fundamental outlook on the investments. The Christmas holiday GICS Sector: Communication Services
Movies & Entertainment sub-industry. This outlook blockbuster movie season, and domestic box Sub-Industry: Movies and Entertainment
reflects increased competition and maturity of office attendance should be up in 2022 versus Based on S&P 1500 Indexes
distribution channels (e.g., theatres) versus a 2021, but 2023 faces consumers pulling back. Five-Year market price performance through Mar 11, 2023
continued evolution of newer channels for digital With a growing array of out-of-home
delivery of content to consumers, as well as a entertainment options available for consumers,
proliferation of subscriber and advertising video on we see potential secular pressures on movie
demand streaming. attendance.
In 2023, we think rising inflation, lower disposable We could see further consolidation among the
income, and inflation may put pressure on Movies & Entertainment industry. After a pause
households that have multiple subscription video in M&A activity across the media industry amid
on demand (SVOD) subscriptions. Recession may the pandemic, we anticipate a material pickup
alter the pandemic video boon. ahead. In 2022, the merger closed between
We do see escalation of the arms race for Discovery and AT&T’s WarnerMedia, and
programming content amid intensifying streaming Amazon/MGM Studios were major milestones.
wars. With film/TV production by Hollywood So, the next M&A wave could be driven by the
studios back in full swing after the lockdown, need for SVOD profitability or expansion of
global content spending in 2022-2023 should distribution by partnering with a Walmart or
increase dramatically from lower levels in 2020- Costco.
2021, while media companies launch or expand Amid further convergence of content,
their video streaming services internationally. As technology, and services, recent years have
several notable entrants (such as Disney+, witnessed the growing popularity of streaming
Discovery+, HBO Max, Peacock, and Paramount+) video platforms, such as Netflix, Amazon,
increasingly take on early movers, such as Netflix, Disney+, discovery+, HBO Max, and Paramount
Amazon Prime Video, and Hulu, the global +. We see ratcheted content investments as
streaming wars is intensifying. content providers face intensifying competition
Slowing new subscriber growth has ignited new from both traditional and online video
questions about the economics and ROI for this platforms, including from social media outlets,
media distribution format. There is wide debate such as Meta, YouTube, and Twitter. We would
whether SVOD can achieve the same economics not count out Amazon Prime Video or Apple TV
with high recurring revenue and EBITDA growth, as in this foray.
linear broadcast and pay TV formats have As of December 30, 2022, the S&P Movies & NOTE: A sector chart appears when the sub-industry does not have
delivered in the past. All eyes are on the largest Entertainment Index declined 50.0%, versus a sufficient historical index data.
SVOD providers and their execution of profitable 19.4% decrease in the S&P 500 Index. In 2021, All Sector & Sub-Industry information is based on the Global Industry
growth. Netflix’s November launch of ad-paying the sub-industry was 2.4% lower, compared to Classification Standard (GICS).
subscriber plans at $6.99 monthly is well below its 26.9% gain for broader market benchmark. Past performance is not an indication of future performance and should
highest offering at $19.99 monthly for ad-free, / Kenneth Leon not be relied upon as such.
high definition TV viewing. New sources of Source: CFRA, S&P Global Market Intelligence
advertising revenue, reduced customer churn, and
better control of subscription leakage should
boost performance.
We will monitor how well the leading companies
sharpen their cost discipline with a 2023
recession, potentially impacting programming and
content spending as well as technology platform

Sub-Industry: Movies and Entertainment Peer Group*: Movies and Entertainment

Recent 30-Day 1-Year Fair Return
Stock Stock Stk. Mkt. Price Price P/E Value Yield on Equity LTD to
Peer Group Symbol Exchange Currency Price Cap. (M) Chg. (%) Chg. (%) Ratio Calc. (%) (%) Cap (%)

The Walt Disney Company DIS NYSE USD 96.14 175,629.0 -13.9 -28.1 28.0 93.83 N/A 3.5 28.7
Endeavor Group Holdings, Inc. EDR NYSE USD 23.44 6,832.0 6.6 -12.0 52.0 N/A N/A 11.4 57.3
Formula One Group FWON.K NasdaqGS USD 68.67 15,893.0 -4.4 19.1 NM N/A N/A 0.5 32.2
Live Nation Entertainment, Inc. LYV NYSE USD 68.15 15,693.0 -15.5 -38.0 106.0 35.93 N/A 72.6 62.4
Netflix, Inc. NFLX NasdaqGS USD 297.78 132,615.0 -18.0 -17.0 30.0 312.47 N/A 24.5 38.1
Roku, Inc. ROKU NasdaqGS USD 60.52 8,479.0 -3.2 -48.5 NM N/A N/A -18.4 N/A
Spotify Technology S.A. SPOT NYSE USD 123.93 23,970.0 -1.2 -9.2 NM N/A N/A -19.0 27.4
Tencent Music Entertainment Group TME NYSE USD 7.43 12,594.0 -11.6 68.1 20.0 8.23 N/A 6.5 10.4
Warner Bros. Discovery, Inc. WBD NasdaqGS USD 14.77 35,892.0 -3.6 -41.8 NM N/A N/A -23.5 48.1
Warner Music Group Corp. WMG NasdaqGS USD 30.04 15,499.0 -18.7 -10.2 32.0 N/A 2.1 216.3 87.7
iQIYI, Inc. IQ NasdaqGS USD 7.19 6,804.0 -2.4 75.4 34.0 N/A N/A -2.0 34.2

*For Peer Groups with more than 10 companies or stocks, selection of issues is based on market capitalization.
NA-Not Available; NM-Not Meaningful.
Note: Peers are selected based on Global Industry Classification Standards and market capitalization. The peer group list includes companies with similar characteristics, but may not include all the companies within the same
industry and/or that engage in the same line of business.

Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 4
Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Analyst Research Notes and other Company News

February 09, 2023 August 12, 2022

08:15 AM ET... CFRA Reiterates Buy Rating on Shares of The Walt Disney Company 11:58 AM ET... CFRA Reiterates Hold Opinion on Shares of The Walt Disney Company
(DIS 111.78****): (DIS 112.43***):
We raise our target by $25 to $135, forward TEV/EBITDA of 18.3x, below 5-year We raise our target $20 to $130 on a forward TEV/EBITDA of 15.1x, above peers
historical average of 22.0x. We raise our EPS estimates by $0.25 in both FY 23 given leading franchises. With higher losses in direct-to-consumer unit, we reduce
(Jun.) to $4.25 and FY 24 to $5.80. We think DIS can move faster with refined our EPS estimates in FY 22 (Sep.) $0.15 to $3.85 and FY 23’s $0.25 to $5.30. DIS
strategy, cost cutting, and Bob Iger leading the company. Release had new $6b cost posts Q3 FY 22 EPS of $1.09, a $0.10 consensus beat. Our revenue forecast is
reduction plan, $3b reduction in current $30b (prior $36b) content spend, $84.7b in FY 22 and $93.7b in FY 23, no major changes from prior estimates. In Q3
commitment to rebalance focus in linear and streaming networks, and delight FY 22, DIS delivered a 2% revenue beat led by strength in Disney Parks due to
guests at parks. There are no signs of weakness in parks with 25% revenue growth. reopening, which helped realize a 70% Y/Y increase in revenue and $2.2b operating
DIS posts Q2 FY 23 EPS of $0.99, a $0.19 consensus beat with revenue beat, 8% Y/Y income vs. $356m a year ago. We think this segment has reached normalized levels.
revenue growth. Total Disney subscribers -1% to 161.8m. Direct to consumer Linear Networks (pay TV and broadcast) delivered only +3% revenue growth Y/Y, but
(Disney+ and other plans) narrowed operating loss by $500m to $1.05b and guides a 13% gain in operating income by cutting back programming costs. Disney+ added
Q2 FY 23 to reduce losses another $200m. Goal is breakeven by end of FY 24. Linear 14.4m subscribers Q/Q, but domestic was nearly flat. International saw Q/Q gain of
networks revenue declined 5% Y/Y and operating income -16%, as DIS faced lower 6.1m, excluding Disney+ Hotstar (India) +8.3m. Disney+ had a $1.1b operating loss,
advertising spend and forex pressure, offset by higher results at Cable. / Kenneth wider than -$887m in Q2 FY 22 and -$223m a year ago. / Kenneth Leon
Leon
July 19, 2022
November 21, 2022 11:12 AM ET... CFRA Lowers Opinion to Hold from Buy on Shares of The Walt Disney
10:00 AM ET... CFRA Keeps Buy Opinion on Shares of The Walt Disney Company (DIS Company (DIS 97.56***):
100.00****): DIS does not pay a cash dividend nor has the company repurchased common stock
Reality on how hard it is to grow profitably in video streaming has led to the return since 2018. We think this puts added pressure on successful execution of Disney+,
of Robert Iger as CEO, replacing Bob Chapek. DIS’s ambitions to aggressively scale its video streaming plan, which requires significant capital. We reduce our target by
Disney+ and be profitable by 2024 are likely to be scaled back with new leadership. $10 to $110 on a forward TEV/EBITDA of 15.6x, in line with direct peers. We lower
We think Mr. Iger will look to better harmonize DIS assets in movies, TV our FY 22 (Sep.) EPS $0.45 to $4.00 and FY 23’s $0.15 to $5.55. On August 10, we
programming, and distribution to attain higher EBITDA / profitability. We expect DIS estimate DIS to post Q3 FY 22 EPS of $1.00 on revenue near $21b. Disney Parks
to downsize its ambitions in emerging markets like India that offer lower subscriber may realize peak seasonal results in Q3 FY 22, but we expect to see weaker
rate plans. What to do with Hulu, where DIS may purchase the remaining 33% attendance in FY 23 due to recession. Also, there is uncertainty to reopening or
interest by 2024 or earlier at a minimum valuation of $27.5b from Comcast, will also potential closings again of the Hong Kong and Shanghai parks due to Covid. In Q2 FY
be a key decision for Iger and the board of directors. DIS remains a leading company 22, linear networks (pay TV and broadcast) realized 5% revenue growth and $2.8b
with great franchises, but a more pragmatic strategy is needed, especially with a operating income, with direct to consumer +23% ($887m loss) and merchandise
2023 recession looming. We keep our $110 target on a forward TEV/EBITDA of 13.5x, content/licensing -3% (+$16m). Disney+ is being rolled out to 53 new markets in
below the 5-year historical average of 15.7x. DIS does not pay a dividend and has EMEA and the service depends on penetration in India. / Kenneth Leon
not repurchased shares since 2018. / Kenneth Leon
May 12, 2022
November 11, 2022 08:58 AM ET... CFRA Keeps Buy Opinion on Shares of The Walt Disney Company (DIS
02:59 PM ET... CFRA Retains Buy Opinion on Shares of The Walt Disney Company 105.21****):
(DIS 99.90****): As we narrow our risk premium for DIS shares given its transition to reach 230m-
We lower our target price $10 to $110, a forward TEV/EBITDA of 13.5x that is below 240m streaming subscribers by 2024, we lower our target by $80 to $120, forward
5-year historical average of 15.7x. We reduce our FY 23 (Sep.) EPS estimate by TEV/EBITDA of 16.7x, in line with direct peers. We raise our FY 22 (Sep.) EPS by
$1.30 to $4.00 and introduce our FY 24 EPS at $5.55. DIS posts Q4 FY 22 EPS of $0.03 to $4.45 and lower FY 23’s by $0.01 to $5.70. DIS post Q2 FY 22 EPS of $1.08,
$0.30, a $0.26 miss to consensus, given the $1.5b operating loss in direct-to- an $0.08 consensus miss and $1.92 revenue, a net $789m miss. Disney Parks with
consumer. Our revenue forecast is $90.6b in FY 23 and $99.5b in FY 24 versus reopening realized 2.8x increase in revenue Y/Y and $1.4b operating income versus -
$82.7b in FY 22. In Q4 FY 22, DIS delivered 9% Y/Y revenue growth led by strength in $587m loss a year ago. However, Q3 FY 22 will see $350m loss from Hong Kong and
Disney Parks due to reopenings, which realized +36% Y/Y in revenue and $1.5b Shanghai parks shutdown. Linear networks (pay TV and broadcast) realized 5%
operating income. Linear Networks (pay TV and broadcast) delivered a 3% revenue revenue growth and $2.8b operating income, direct to consumer +23%, $887m loss,
decline Y/Y and a sharp decline in operating profit due to lower advertising revenue, and merchandise content/licensing -3%, +$16m. DTC and cable pay tv had higher
higher programming costs, and technology platforms. Disney+ added 7.6m programming/content costs, including four additional NFL games. Linear networks
subscribers Y/Y, but average revenue per paid subscriber was 10% lower to $6.10, showed +8 domestic revenue growth while international -3%. Disney+ will launch
with Disney+ Core International at -4%. Peak operating losses for Disney+ are AVOD and added 7.9m subscribers, and DTC ended quarter with 205m. / Kenneth
expected to be Q4 FY 22 and it reaffirmed operating profits in FY 24. / Kenneth Leon Leon

October 03, 2022

02:00 PM ET... CFRA Upgrades Opinion on Shares of The Walt Disney Company to Buy
from Hold (DIS 96.65****):
We see a buying opportunity with share price down 23% from mid August. We lower
our 12-month target by $10 to $120 on a forward TEV/EBITDA of 14.6x, above peers
given leading franchises. We keep our EPS at $3.85 in FY 22 (Sep.) and $5.30 in FY
23, both near consensus. Following total revenue of $61.4b in FY 21, we forecast
$84.4b in FY 22 and $93.8b in FY 23. Disney+ execution remains a risk factor as to
whether DIS can grow this business profitably over the longer term. We believe
Disney+ will be a winner given management strength of the DIS franchises across
studio content production, programming, and cross-selling distribution capabilities.
Linear Networks (pay TV and broadcast) are key businesses in providing cash
generation for DIS expansion on digital platforms. Our Buy rating assumes
attendance and revenue at The Disney Parks may slow down in FY 23. A key catalyst
is the purchase of 33% interest in Hulu in 2024 or earlier from Comcast (CMCSA 31
****), at a minimum total valuation of $27.5b. / Kenneth Leon

Note: Research notes reflect CFRA's published opinions and analysis on the stock at the time the note was published. The note reflects the views of the equity analyst as of
the date and time indicated in the note, and may not reflect CFRA's current view on the company.
Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 5
Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
Analysts Recommendations Wall Street Consensus Opinion

Buy/Hold

Wall Street Consensus vs. Performance

For fiscal year 2023, analysts estimate that DIS will earn
USD 4.17. For fiscal year 2024, analysts estimate that DIS's
earnings per share will grow by 31.51% to USD 5.49.

No. of
Recommendations % of Total 1 Mo.Prior 3 Mos.Prior
Buy 18 55 18 18
Buy/Hold 8 24 8 7
Hold 6 18 6 5
Weak hold 0 0 0 0
Sell 0 0 0 0
No Opinion 1 3 1 3
Total 33 100 33 33

Wall Street Consensus Estimates

Fiscal Year Avg Est. High Est. Low Est. # of Est. Est. P/E
2024 5.49 6.33 4.49 28 17.53
2023 4.17 4.56 3.75 26 23.05
2024 vs. 2023 p 32% p 39% p 20% p 8% q -24%

Q2'24 1.29 1.40 1.11 9 74.64

Q2'23 0.99 1.29 0.70 25 96.82
Q2'24 vs. Q2'23 p 30% p 9% p 59% q -64% q -23%
Forecasts are not reliable indicator of future performance.
Note: A company's earnings outlook plays a major part in any investment decision. S&P Global Market Intelligence organizes the earnings estimates of over 2,300 Wall Street analysts, and
provides their consensus of earnings over the next two years, as well as how those earnings estimates have changed over time. Note that the information provided in relation to consensus
estimates is not intended to predict actual results and should not be taken as a reliable indicator of future performance.
Note: For all tables, graphs and charts in this report that do not cite any reference or source, the source is S&P Global Market Intelligence.

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Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
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Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
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Stock Report | March 11, 2023 | NYSE Symbol: DIS | DIS is in the S&P 500
The Walt Disney Company
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3/13/23, 3:32 PM Disney Proposal to Restructure, on McKinsey’s Advice, Triggered Uproar From Creative Executives - WSJ

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https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586

◆ WSJ NEWS EXCLUSIVEBUSINESS

Disney Proposal to Restructure, on McKinsey’s

Advice, Triggered Uproar From Creative
Executives
Tension flared over plans to take control of marketing, other decisions away from
content chiefs

By Robbie Whelan Follow , Joe Flint Follow and Jessica Toonkel Follow
Dec. 1, 2022 4:03 pm ET
LOS ANGELES—Walt Disney Co. DIS -0.82% was working with consulting firm McKinsey & Co. in
recent months on an effort to centralize control of major spending decisions, triggering an uproar
from top creative executives at the entertainment giant, according to people familiar with the
matter.

Discussions regarding the plan were under way in the weeks leading up to Nov. 20, when Disney’s
board of directors fired Bob Chapek as chief executive and replaced him with his predecessor,
Robert Iger.

Disney’s Chief Financial Officer Christine McCarthy spearheaded the wide-ranging cost-cutting
effort, which was blessed by Disney’s board of directors and given the go-ahead by Mr. Chapek, the
people said.

The company hired McKinsey in September to review Disney’s operations and identify
redundancies and cost-saving opportunities. The McKinsey team quickly set about interviewing
senior executives as part of its review, with a particular focus on how Disney marketed its content,
the people familiar with the matter said.

One potential change McKinsey was exploring was taking decisions about spending on marketing
and publicity for films and television programs out of the hands of studio executives and instead
centralizing them in another part of the company, the people said.

Disney itself had already considered shifting oversight of marketing spending to Disney Media and
Entertainment Distribution, or DMED, some of the people familiar said. Led by executive Kareem
Daniel, a top lieutenant of Mr. Chapek, that division already had considerable influence over
content.

https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586 1/5
3/13/23, 3:32 PM Disney Proposal to Restructure, on McKinsey’s Advice, Triggered Uproar From Creative Executives - WSJ

In addition to recommending restructuring related to content decisions, McKinsey had also

suggested consolidating tasks related to hiring, communications and legal services, some of the
people familiar with the matter said.

CFO Christine McCarthy spearheaded the wide-ranging cost-cutting effort.

PHOTO: MICHAEL KOVAC/GETTY IMAGES

The plans that were emerging rankled some of the entertainment company’s top content
executives, already reeling from losing power over spending decisions on content, and became one
of several points that exposed a further rift between the creative and corporate leadership of the
company during Mr. Chapek’s brief reign as CEO. Some executives told colleagues they felt that the
changes would strip them of nearly all of their power, people familiar with the situation said.

In one of his first moves after being reinstalled as CEO, Mr. Iger, who led Disney from 2005 to 2020,
announced that he would do away with the DMED structure and said that he planned to empower
Disney’s content creators. Mr. Daniel exited Disney the day after Mr. Chapek’s ouster.

“It is my intention to restructure things in a way that honors and respects creativity as the heart
and soul of who we are,” Mr. Iger said in a memo to employees last week.

The McKinsey plans weren’t completed, and it isn’t clear whether Mr. Iger will implement any of
the consultants’ recommendations, according to people familiar with the situation.

At a town hall meeting on Monday, Mr. Iger said Disney needs to spend more wisely on content and
the ancillary costs that come with it.

Disney and other media companies have been under pressure from investors to reduce their
spending amid intensifying competition and a weakening economy. Disney has been trying to
maneuver its streaming business from focusing on adding new subscribers to its services such as
Disney+ and Hulu, to generating profits.
https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586 2/5
3/13/23, 3:32 PM Disney Proposal to Restructure, on McKinsey’s Advice, Triggered Uproar From Creative Executives - WSJ

After its most recent quarterly earnings report the company warned of layoffs and spending cuts,
saying that it was taking a close look at marketing and administrative costs. Shortly before Mr.
Chapek was fired, Ms. McCarthy told directors on Disney’s board that she had lost confidence in his
leadership.

Even before the recent proposals, some creative executives at Disney were frustrated with the
DMED division, which Mr. Chapek created in late 2020, said people familiar with the matter. Mr.
Chapek said at the time that the reorganization would better accommodate changing consumer
habits and help the company give priority to streaming.

Mr. Daniel had significant influence over content budgets for Disney’s studios and final say about
how to distribute movies and TV shows, whether in theaters, on network TV or on streaming
services like Disney+.

Relations between Mr. Daniel’s unit and Disney’s creative leaders were often strained, people
familiar with the matter said. People close to Mr. Daniel said he was seen as an agent of change for
a business reluctant to embrace it.

Disney hired McKinsey in September to review its operations and identify redundancies and cost-saving opportunities.
PHOTO: ARND WIEGMANN/REUTERS

Ms. McCarthy has previously clashed with creative executives over managing costs and
programming strategy, people close to her said. She played a role in Mr. Chapek’s decision to
remove Peter Rice as chairman of Disney’s General Entertainment Content unit earlier this year.

Throughout his career, Mr. Chapek has used and praised a management framework that
emphasizes accountability and a structure for corporate responsibility. The method, called ARCI,
is often taught in business schools. Under the philosophy, there should be no ambiguity about who
is responsible for the success or failure of an effort.

https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586 3/5
3/13/23, 3:32 PM Disney Proposal to Restructure, on McKinsey’s Advice, Triggered Uproar From Creative Executives - WSJ

Under the ARCI framework, each time a company makes a big change, it must identify personnel
who are accountable for the decision, responsible for its success or failure, consulted for feedback
and informed of its impact.

“Who’s got the ‘A’ on this project?” Mr. Chapek would often ask in meetings, according to people
familiar with the matter—meaning, who is accountable for it?

Some executives found the approach irritating because they felt it invited other managers to get
involved with decisions that ordinarily would be made by a single segment head, people familiar
with the matter said.

Proponents of the plans argue that such a restructuring made sense as a way of addressing
redundancies under the current model. Among the advantages cited by those with knowledge of
the proposal was that one group could negotiate advertising rates for multiple entertainment
units. Such a plan would have also led to reductions in staff as a result, people familiar with plans
said.

Some Disney executives also believed that the DMED unit would be in a better position than the
creative units to determine which movies and television series were likely to draw large audiences
on various platforms and how much to spend to market each project given its access to
performance data, the people familiar with the plans said.

In a memo he circulated on his first day back in the job, Mr. Iger named a committee consisting of
top Disney executives including Ms. McCarthy, studios chairman Alan Bergman, Disney General
Entertainment Chairman Dana Walden and ESPN Chairman James Pitaro to work on “the design of
a new structure that puts more decision-making back in the hands of our creative teams and
rationalizes costs.”

Disney Chief Financial Officer Christine McCarthy, then-CEO Bob Chapek, and executives Kareem Daniel and Louis D'Esposito
at the premiere of ‘Thor: Love and Thunder’ earlier this year.

https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586 4/5
3/13/23, 3:32 PM Disney Proposal to Restructure, on McKinsey’s Advice, Triggered Uproar From Creative Executives - WSJ

PHOTO: CHARLEY GALLAY/GETTY IMAGES

Appeared in the December 2, 2022, print edition as 'Disney Hired McKinsey for Revamp, Spurring Dissent'.

https://www.wsj.com/articles/disney-proposal-to-restructure-on-mckinseys-advice-triggered-uproar-from-creative-executives-11669928586 5/5
 Note: The following is a redacted version of the original report published on 18 November 2022 [20 pgs].

18 November 2022 | 5:59PM EST

US Economics Analyst

2023 US Economic Outlook: Approaching a Soft Landing

(Mericle)
n The key macroeconomic question of the year has been whether inflationary Jan Hatzius
+1(212)902-0394 | [email protected]
overheating can be reversed without a recession. Our analysis suggests that the Goldman Sachs & Co. LLC

answer is yes—an extended period of below-potential growth can gradually Alec Phillips
+1(202)637-3746 | [email protected]
reverse labor market overheating and bring down wage growth and ultimately Goldman Sachs & Co. LLC

inflation, providing a feasible if challenging path to a soft landing. David Mericle

+1(212)357-2619 |
[email protected]
n The initial steps along this path have been successful, but there is much further Goldman Sachs & Co. LLC

to go in 2023. We expect another year of below-potential growth and labor Spencer Hill, CFA
+1(212)357-7621 | [email protected]
market rebalancing to solve much but not all of the underlying inflation problem. Goldman Sachs & Co. LLC

Unlike consensus, we do not expect a recession. Joseph Briggs

+1(212)902-2163 |
[email protected]
n The first step in keeping the adjustment process on track is ensuring that GDP Goldman Sachs & Co. LLC
growth remains below potential. The fiscal tightening that helped to slow the Ronnie Walker
+1(917)343-4543 |
economy this year has mostly run its course, but the large tightening in financial [email protected]
Goldman Sachs & Co. LLC
conditions engineered by the Fed should keep GDP growth near 1% in 2023.
Tim Krupa
Consumer spending should grow a bit more firmly as income begins to rise +1(202)637-3771 | [email protected]
Goldman Sachs & Co. LLC
again, but this is likely to be offset by weakness elsewhere, especially in
Manuel Abecasis
housing. +1(212)902-8357 |
[email protected]
Goldman Sachs & Co. LLC
n The second step requires soft GDP growth to further reduce labor demand. So
far, the speed and composition of labor market rebalancing have been
encouraging. Our jobs-workers gap has shrunk substantially, driven by a decline
in job openings rather than employment. In 2023, we expect a further large
decline in job openings coupled with a ½pp rise in the unemployment rate to
shrink the jobs-workers gap from the historical peak of 5.9 million reached earlier
this year to the 2 million threshold that we estimate is necessary to dampen
labor market overheating.
n The third step requires labor market rebalancing to slow wage growth. Wage
growth has begun to moderate in recent months, and we expect it to fall to 4%
by the end of 2023, not far above our 3.5% estimate of the pace compatible
with 2% inflation. If so, this intermediate step would provide crucial early
support for the view that overheating can be reversed without a recession.
n The fourth step requires softer wage growth to bring inflation back to target. This
should get underway in 2023 but will take longer. We expect core PCE inflation
to fall from roughly 5% to 3% by December 2023, driven largely by goods
categories where supply chain recovery is now reversing pandemic shortages.

Investors should consider this report as only a single factor in making their investment decision. For Reg AC
certification and other important disclosures, see the Disclosure Appendix, or go to
www.gs.com/research/hedge.html.
Goldman Sachs US Economics Analyst

Services inflation is likely to fall meaningfully in the official data only with a longer
lag, especially in the largest categories, shelter and health care.

n We expect the FOMC to slow the pace of rate hikes as it shifts to fine-tuning the
funds rate to keep growth below potential, but to ultimately deliver a bit more than
is priced, with a 50bp hike in December and three 25bp hikes next year raising the
funds rate to a peak of 5-5.25%. Our recession odds are below consensus even
though our Fed forecast is slightly more hawkish than consensus because we
expect demand to prove more resilient than expected next year.

18 November 2022 2
Goldman Sachs US Economics Analyst

2023 US Economic Outlook: Approaching a Soft Landing

A year ago, the inflation problem began to broaden beyond the initial pandemic-driven
dislocations and started to also include an element of textbook overheating in which
labor demand far exceeded labor supply and high wage growth, high inflation, and high
short-term inflation expectations reinforced each other in a feedback loop. Since then,
the key macroeconomic question has been whether inflationary overheating can be
reversed without a recession.

Earlier this year, we introduced a step-by-step framework for analyzing this question,
summarized by the diagram in Exhibit 1.1 Working backwards, we first asked how much
wage growth would need to decline to be compatible with 2% inflation and concluded it
would have to fall from 5.5% to 3.5%. We then asked how much the imbalance
between labor demand and labor supply would need to shrink to dampen wage
pressures and concluded that the jobs-workers gap would have to fall from 5.9 million,
the widest gap in history, to 2 million. Finally, we asked how weak aggregate demand
would have to be to reduce labor demand enough to achieve this rebalancing, assuming
that labor supply rebounded only modestly, and concluded that an extended period of
positive but below-potential GDP growth could reduce labor demand by the amount
required. The punchline was that there is a plausible path to a soft landing, though
calibrating policy just right to stay on that path would surely be challenging.

The initial steps along this path have been successful, but there is much further to go in
2023. Growth slowed quickly to a solidly below-potential pace this year, labor market
rebalancing has gone very well so far, and recent months have finally brought signs of
moderation in wage growth and inflation. We expect another year of below-potential
growth and further labor market rebalancing in 2023 to solve much but not all of the
underlying inflation problem. Unlike consensus, we do not expect a recession.

1
These reports include More Jobs than Workers: A New Measure of Labor Market Tightness, What Will It
Take to Restore Balance to the Labor Market?, Q&A on the Jobs-Workers Gap and the Risk of Recession, A
Recession Is Not Inevitable, Prospects for a Soft Landing: What Could Make the Fed’s Job Easier or Harder?,
What Wage Growth Rate Is Compatible With 2% Inflation?, Taming Inflation Without a Recession: A Progress
Report, and The Expected Path to Sustainable Wage Growth.

18 November 2022 3
Goldman Sachs US Economics Analyst

Exhibit 1: . We Expect Another Year of Below-Potential GDP Growth in 2023 to Rebalance the Labor Market
and Slow Wage Growth and Inflation, but Reaching the 2% Target Will Take Longer

Percent change, year ago Millions

9 The Slowdown Required to Rebalance the Labor Market 9
8 and Calm Wage Growth and Inflation 8
Starting Point
7 7
Current
6 End-2023, GS Forecast 6
5 Required, GS Estimate 5
4 4
3 3
2 2
1 1
0 0
GDP Growth (left) Jobs-Workers Gap Wage Growth Core PCE Inflation (left)
(right) (left)

Below-potential ...lowers the jobs- ...which slows down ...to bring down
GDP growth... workers gap... wage growth... core inflation

Source: Department of Commerce, Department of Labor, Goldman Sachs Global Investment Research

Another Year of Below-Potential Growth, Not a Recession

The first step in keeping the adjustment process on track is ensuring that GDP growth
remains below potential. GDP growth is on track to slow from 5.7% in 2021 (Q4/Q4) to
just 0.2% in 2022, meaning that so far, policy tightening has been very well calibrated to
slow demand growth as much as possible without accidentally tipping the economy into
a recessionary spiral, an underappreciated success. In 2023, we expect GDP growth of
about 1%, below potential but well above consensus expectations.

Exhibit 2: GDP Growth Slowed Abruptly in 2022, and We Expect It to Remain Below Potential in 2023
Percent, quarterly annual rate Percent, monthly annual rate Percent change Percent change
9 9 2.5 Real GDP Growth 2.5
US Real GDP Growth (left)
GS Current Activity Indicator (right) GS Forecast
GS Potential Growth Estimate Consensus
2.0 GS Potential Growth Estimate 2.0
6 6
1.5 1.5
1.3 1.3
1.1
1.0
3 3 1.0 0.9 1.0
0.8
0.6 0.6

0.5 0.3
0.5
0.2
0 0 0.1
0.1

0.0 0.0
-0.1 -0.1

-3 -3 -0.5 -0.5
Jan-2021 Jul-2021 Jan-2022 Jul-2022 Q4 Q1 Q2 Q3 Q4 2022 2023
Note: GDP growth is plotted in central month of quarter. For CAI, a 3 month average is shown. 2022, 2023, QoQ AR Q4/Q4
QoQ AR

Source: Department of Commerce, Bloomberg, Goldman Sachs Global Investment Research

A year ago, our below-consensus growth forecast for 2022 largely reflected the drag we
expected from fiscal and monetary policy tightening. Today, our above-consensus

18 November 2022 4
Goldman Sachs US Economics Analyst

forecast for 2023 in part reflects the diminishing impact of policy restraint. The large
drag from the expiration of pandemic fiscal relief measures is now mostly behind us,
and our financial conditions index (FCI) framework implies that the impact of monetary
policy tightening is peaking now and will gradually fade in 2023.

Exhibit 3: Fiscal Policy Tightening Is Mostly Behind Us, and the Impact of the Tightening in Financial
Conditions Engineered by the Fed Is Likely Peaking Now

Percentage points Impulse to Quarterly Annualized GDP Growth Percentage points

8 From Fiscal Policy and Financial Conditions, 8
GS Estimates
6 6

4 Fiscal Impulse 4
Financial Conditions Impulse
2 Total 2

0 0

-2 -2

-4 -4

-6 -6

-8 -8
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2021 2022 2023

Source: Goldman Sachs Global Investment Research

An important consequence of the end of the fiscal tightening is that income should start
growing again. Real disposable income fell for a year as special transfer payments
expired and inflation outran wage growth. With few transfers left to lose and inflation
likely to be more restrained in 2023, we expect real income to rise 3.5% next year,
although this partly reflects large gains from interest income and tax rate normalization
that will accrue mostly to high-income households and have less impact on spending.
Offsetting the turnaround in income, wealth effects on consumer spending have shifted
from positive to negative as higher interest rates have brought down equity and home
prices, the latter of which likely have further to fall. We expect these forces, along with
other influences including fading boosts from the reopening impulse and excess
savings, to net out to consumption growth of roughly 1.5% in 2023.

18 November 2022 5
Goldman Sachs US Economics Analyst

Exhibit 4: We Expect Consumer Spending to Grow 1.5% in 2023 as a Year of Falling Income Offset by Positive Wealth Effects Gives Way to a
Year of Rising Income Offset by Negative Wealth Effects
Percent change vs. Dec. 2020 Percent change vs. Dec. 2020 Percentage points Percentage points
30 Household Disposable Income 30 3.0 Contributions to Quarterly Annualized 3.0
Real PCE Growth from Wealth Effects*
25 Other Income (Nominal) 25 2.5 2.5
Crypto
Government Transfer Payments (Nominal)
20 20 2.0 Real Estate 2.0
Inflation
Equities
Real Disposable Income 1.5 1.5
15 15
1.0 1.0
10 10
0.5 0.5
5 5
0.0 0.0
0 0
-0.5 -0.5
-5 -5
-1.0 -1.0
-10 -10 -1.5 -1.5
-15 -15 -2.0 -2.0
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2021 2022 2023 2024
2021 2022 2023
* Our estimates assume that the SP500 will stand at 4000 at end-2023
and that home prices will decline 12% from their peak.

Source: Department of Commerce, Goldman Sachs Global Investment Research

Other areas of the economy are likely to be weaker, especially the interest rate-
sensitive housing sector, the business structures component of capital spending, and
government spending. This should keep GDP growth near 1% in 2023, a pace that is
likely close to a speed limit for the Fed until a larger dent has been put in the inflation
problem, in that acceleration beyond this point would likely be unwelcome and might be
met with further tightening to ensure that supply and demand continue to rebalance
quickly.

Exhibit 5: We Expect GDP to Grow About 1% in 2023 as Weakness in Housing, Business Structures, and
Government Spending Offsets Somewhat Firmer Consumption Growth

Percent change, annual rate Percent change, annual rate

6 Contributions to GDP Growth 6
GS Forecast
4 4

2 2

0 0

-2 Consumption 1.5% -2
Nonres. Fixed Investment 2.4%
-4 Housing -8.4% -4
2023 Q4/Q4
Inventories 0.0pp
Growth Rate*
Trade -0.2pp
-6 -6
Government 0.5%
Total 1.1%
-8 -8
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2022 2023
* Shows inventories' and trade's contributions to 2023 Q4/Q4 GDP growth.

Source: Department of Commerce, Goldman Sachs Global Investment Research

Reversing Labor Market Overheating Without a Spike in the Unemployment Rate

Below-potential growth has already produced a rebalancing in the labor market whose

18 November 2022 6
Goldman Sachs US Economics Analyst

speed and composition have been very encouraging. Based on timely job openings
measures from LinkUp and Indeed, we estimate that the jobs-workers gap—total labor
demand (employment plus job openings) minus total labor supply (the size of the labor
force)—has fallen from a peak of nearly 6 million to just over 4 million. All of the decline
in labor demand so far has come from a decline in job openings—a drop that is much
larger than any in US history seen outside a recession—rather than in employment.

How has this been possible? Didn’t a shift out in the Beveridge curve during the
pandemic signal a breakdown in the efficiency with which workers matched to jobs,
implying that a large decline in labor demand would unfortunately have to involve a large
increase in the unemployment rate? And wouldn’t this set in motion the usual
recessionary vicious circle where job loss leads to a sharp pullback in spending, leading
to more job loss? In our view, the Beveridge curve debate last summer missed several
important points: what looked like a conventional shift out in the curve signaling a
structural increase in mismatch was more a matter of unemployed workers temporarily
not wanting or applying for jobs because of elevated unemployment benefits and Covid
fears; standard measures of industry mismatch were low, not high; and the rate at
which unemployed workers were flowing into new jobs was high, not low. These points
have made us confident that the labor market is on a steep part of the Beveridge curve
where a reduction in labor demand disproportionately takes the form of a decline in job
openings.

This favorable trend is likely to continue for now. Job openings are still falling, and the
layoff rate remains very low, despite recent layoffs in the technology sector. We expect
a further large drop in job openings in 2023 coupled with a more limited ½pp rise in the
unemployment rate to shrink the jobs-workers gap to the 2 million threshold that we
estimate would slow wage growth to a sustainable rate.

Our forecast implies a trough to peak increase in the unemployment rate of 0.7pp,
roughly one-third the increase seen in even the shallowest US recessions. In part for
that reason and in part because we expect activity growth to remain positive, our
forecast would probably not be classified as a recession.

18 November 2022 7
Goldman Sachs US Economics Analyst

Exhibit 6: We Expect the Jobs-Workers Gap to Shrink to the 2mn Threshold That We Estimate Is Needed by the End of 2023, Led by a Large
Decline in Job Openings and a ½pp Rise in the Unemployment Rate
Millions Millions Millions Contributions to Change in Jobs-Workers Gap Millions
US Jobs-Workers Gap
Since March Peak
6 6 2 2
Shaded bars show
5 5 GS forecast.
1 1

4 4 0 0
3 3
-1 -1
2 2
Required, GS Estimate -2 -2
1 1
-3 -3
0 0 Required Jobs-Workers Gap, GS
Estimate
-4 -4
-1 -1

-2 Jobs-Workers Gap, JOLTS Job Openings -2 -5 Change in Labor Force (Supply):

-5
Change in Jobs (Demand):
Jobs-Workers Gap, GS Forecast Change in Employment Change in Particpation Rate
-3 -3 -6 Change in Job Openings Change in Population -6
Jobs-Workers Gap, Alternative Job Openings*
Change in Jobs-Workers Gap
-4 -4 -7 -7

Aug-…
Sep-…

Nov-…
Dec-…

Aug-…
Sep-…

Nov-…
Dec-…
May…

May…
Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jul-23 Jan-24

Mar-22
Apr-22

Oct-22

Apr-23

Oct-23
Jun-22
Jul-22

Jan-23

Mar-23

Jun-23
Jul-23
Feb-23
* Average of job openings from Indeed and LinkUp, scaled to JOLTS job openings.

Source: Department of Labor, Indeed, LinkUp, Goldman Sachs Global Investment Research

Wage Growth Slows Most of the Way to a Sustainable Rate

Only recently has labor market rebalancing begun to yield clearer evidence of a
moderation in wage growth. Average hourly earnings have decelerated meaningfully and
survey measures of current and future wage growth have fallen too, though the
employment cost index decelerated only a touch in Q3.

We see some risk of an upcoming “January effect” where more wage contracts reset
at the start of the year and incorporate larger than usual cost of living adjustments,
resulting in an outsized jump in wages even after seasonal adjustment. But by the end
of 2023, we expect a large decline in the jobs-workers gap to reduce wage growth from
the peak of 5.5% reached in the middle of this year to 4%, not far above our 3.5%
estimate of the pace compatible with 2% inflation.

Because lowering inflation to an acceptable rate is likely to take a while, a further

decline in wage growth next year would be a crucial intermediate benchmark that could
reassure policymakers that with patience, gradual labor market rebalancing can reverse
inflationary overheating without a recession.

18 November 2022 8
Goldman Sachs US Economics Analyst

Exhibit 7: Wage Growth Is Showing Early Signs of Moderation and Should Fall to About 4% by Late 2023
Percent change, annual rate Index Percent change, year ago Percent change, year ago
8 Employment Cost Index* (left) 6.0 GS Wage Tracker 6.0
Average Hourly Earnings (Composition-Adj)** (left) 70
7 5.5 5.5
Monthly Wage Surveys*** (right)
60
6 5.0 5.0
50 4.5 4.5
5
40 4.0 4.0
4
30 3.5 3.5
3
3.0 3.0
2 20
2.5 2.5
1 10 GS Forecast
2.0 2.0
0 0
1.5 1.5
-1 -10 1.0 1.0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2015 2017 2019 2021 2023
*ECI wages and salaries private sector ex incentives (SA by Haver), qoq annual rate.
**6m annual rate.
***Average of NFIB, Dallas Fed manufacturing, Dallas Fed services, Richmond Fed
manufacturing, Richmond Fed services, NY Fed services, and Kansas City Fed services.

Source: Department of Labor, Federal Reserve, NFIB, Goldman Sachs Global Investment Research

Core Inflation Falls from 5% to 3%, Led by Goods Categories

The 2023 inflation outlook presents two quite different stories in the goods and
services categories.

On the goods side, supply chain recovery finally appears to be yielding the deflationary
payback that has been deferred for more than a year by a series of further pandemic-
and war-related disruptions. As production of items such as autos rebounds and
inventories are rebuilt, competition should reverse the scarcity effects that raised retail
margins and consumer prices earlier in the pandemic. In addition, more moderate
commodity price inflation, falling transportation costs, and downward pressure on
import prices from dollar appreciation should also help to reduce core PCE goods
inflation, which we expect will fall sharply from 5.7% year-over-year now to -1.6% by
December 2023.

18 November 2022 9
Goldman Sachs US Economics Analyst

Exhibit 8: As Supply Chains Recover, Production Rebounds, and Inventories Rebuild, Competition Should Unwind Scarcity Effects and Lower
Prices in Supply-Constrained Goods Categories Like Autos
Z-Scores Days Percent of avg. 2019 level Millions, annual rate
5 120 120 30
Change in Average Supplier Delivery Time,
Business Surveys (left) New Car Inventories (left)
110 100
4 Auto Assemblies (right)
Production Materials Commitment Leadtime, ISM 25
100 80
Manufacturing Index (right)
3
90 60
20
2
80 40

1 70 20 15

60 0
0
10
50 -20
-1
40 -40
5
-2
30 -60

-3 20 -80 0
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22

Source: Federal Reserve, Institute for Supply Management, Department of Commerce, Goldman Sachs Global Investment Research

On the services side, disinflation will take longer. We expect core PCE services inflation
to fall only modestly from 4.9% now to 4.4% by December 2023. The broad reason is
that there will likely be some lag from a slowdown in wage growth to a slowdown in
inflation in labor-intensive services categories. A more specific reason is that the largest
categories, health care and shelter, already appear destined to run hot because of lags
in the official data. In the health care category, a large Medicare fee adjustment in
response to cost increases this year will affect government-paid services directly and
likely spill over to privately-paid services. In the shelter category, web-based alternative
measures of new tenant rents have already decelerated sharply to an annualized growth
rate of about 3%. But the official series—which covers rents on both new tenant and
continuing tenant leases—is likely to rise a firmer 6% next year as continuing tenant
rents catch up to market rates, though it should decelerate sequentially.

18 November 2022 10
Goldman Sachs US Economics Analyst

Exhibit 9: Alternative Data Show a Sharp Slowdown in New Tenant Rent Growth, but Shelter Inflation Is Likely to Remain High in the Official
Data in 2023 as Continuing Tenant Rents Catch Up to Market Rates
Percent change, annual rate Percent change, annual rate Percent change, year ago Percent change, year ago
35 Sequential Pace of 35 16 16
Alternative Rent Measures (seasonally adjusted) Average of CoStar, Zillow,
30 30 14 and Yardi 14
Zillow (month-over-month, annual rate)
New-Tenant Repeat Rent
25 Yardi (month-over-month, annual rate) 25
12 Index* (From BLS) 12
CoStar (quarter-over-quarter, annual rate)
20 20 Continuing-Tenant Rent
Average of alternative measures 10 10
Index* (Calculated by GS)
15 15 All-Tenant Repeat Rent
8 Index* (From BLS) 8
10 10
CPI Rent + OER
6 6
5 5
4 4
0 0

-5 -5 2 2

-10 -10 0 0
2017 2018 2019 2020 2021 2022 2019 2020 2021 2022 2023
*Adjusted for the historical gap of the ATRR vs. CPI rent.

Source: Zillow, Yardi, CoStar, Department of Labor, Goldman Sachs Global Investment Research

Taken together, we expect year-over-year core PCE inflation to decline from 5.1% in
September to 2.9% in December 2023. We expect an even larger decline in
year-over-year core CPI inflation from 6.3% in October to 3.2% in December 2023. As
we noted last year, this would mean that the large divergence between CPI and PCE in
2022 should fade in 2023 as declines in durable goods prices weigh more heavily on the
CPI and the health services categories in the two indices move in opposite directions.

Exhibit 10: We Expect Core PCE Inflation to Fall from 5.1% Today to 2.9% in December 2023, Led Mainly by
Goods Categories

Percent change, year ago Percent change, year ago

6 Contributions to Year-on-Year Core PCE Inflation 6

5 Supply-Constrained* 5
Other Goods
Travel GS Forecast
4 Other Services 4
Healthcare
3 Shelter 3
Core PCE
2 2

1 1

0 0

-1 -1
Jul-21
Jul-19

Jul-20

Jul-22

Jul-23

Jul-24
Apr-22
Apr-19

Apr-20

Oct-20

Apr-21

Apr-23

Apr-24
Jan-19

Jan-20

Jan-21

Jan-22

Jan-23

Jan-24
Oct-19

Oct-21

Oct-22

Oct-23

Oct-24

* New, used, and rental cars, furniture, sporting equipment, household appliances, sports and recreational vehicles,
and video, audio, photo, and info. equipment.

Source: Department of Commerce, Goldman Sachs Global Investment Research

Fine-Tuning the Funds Rate

We expect the FOMC to slow the pace of rate hikes to 50bp in December and to 25bp

18 November 2022 11
Goldman Sachs US Economics Analyst

in February, March, and May, raising the funds rate to a peak of 5-5.25%.

Exhibit 11: We Expect a 50bp Hike in December Followed by 25bp Hikes in February, March, and May to Raise the Funds Rate to a Peak of
5-5.25%
Percent Rate Hikes at FOMC Meetings Percent Percent Peak Federal Funds Rate Percent
5.5 5.00- 5.5 5.5 5.5
19bp 25bp 8bp 5.25%
5.03%
GS
5.0 33bp 25bp 5.0
Market Pricing
Size of 25bp 5.0 5.0
55bp
4.5 rate hike 50bp 4.5
75bp 4.5 4.5
4.0 4.0

3.5 75bp 3.5 4.0 4.0

3.0 3.0
75bp 3.5 3.5
2.5 2.5
FOMC Estimate of
2.0 Longer Run Rate 2.0 3.0 3.0
75bp
1.5 1.5 2.5 2.5
50bp
1.0 Actual 1.0
GS Forecast 2.0 2.0
0.5 25bp 0.5
3 Market Pricing
0.0 0.0 1.5 1.5
Jan-22 Mar-22 May-22 Jul-22 Sep-22 Nov-22
Mar May Jun Jul Sep Nov Dec Feb Mar May May '23
Level
2022 2023

Source: Federal Reserve, Goldman Sachs Global Investment Research

We see a couple reasons for hikes to continue through the spring. First, our forecast
implies that the inflation trend is likely to remain uncomfortably high for a while longer.
Second, with the fiscal tightening now mostly behind us and household real disposable
income rising again, the FOMC will need to tighten financial conditions enough to keep
the economy on a solidly below-potential growth path.

Exhibit 12: The Inflation Trend Will Remain High in Early 2023, Creating Pressure to Keep Hiking

Percent change, Inflation Trend at Upcoming FOMC Meetings Percent change,

3m annualized rate 3m annualized rate
10 Dec. Feb. Mar. May Jun. Jul. Sep. Nov. Dec. 10
Latest Core CPI 22: 23: 23: 23: 23: 23: 23: 23:
23:
9 Before FOMC 9
Meeting
8 8
7 7
5.0
6 4.0 6
5 4.6 5
5.5
4 4.3 4
3.0 2.9
3 2.8 2.7 2.9 3
Latest Core PCE 3.8
3.4 3.0 3.0 3.0 2.9 2.8 2.8
2 Core CPI Before FOMC 2
Core PCE Meeting
1 1
Core Services PCE
0 0
Jan-22 Apr-22 Jul-22 Oct-22 Jan-23 Apr-23 Jul-23 Oct-23 Jan-24

Source: Department of Commerce, Department of Labor, Goldman Sachs Global Investment Research

We do not expect rate cuts next year because we do not expect a recession and we are
skeptical that a decline in inflation alone would lead the FOMC to cut toward neutral
because we suspect that the Fed leadership shares our skepticism about neutral rate

18 November 2022 12
Goldman Sachs US Economics Analyst

estimates. Instead, we think the more natural path if inflation comes down is to simply
wait until something goes wrong and then deliver either small cuts in response to a
smaller threat, similar to the insurance cuts of 2019, or substantial cuts in response to a
full recession. In the other direction, if inflation is stickier than we expect or underlying
growth momentum is stronger, the FOMC would likely raise the funds rate to a higher
level. Our Fed scenario analysis implies that our probability-weighted average view is a
touch more hawkish than market pricing.

Exhibit 13: Our Scenario Analysis of Possible Fed Paths Implies That Our Probability-Weighted Average View Is a Touch More Hawkish
Than Market Pricing
Percent Fed Funds Rate Scenario Analysis Percent Percent Fed Funds Rate Percent
7.5 Higher Inflation, More Hikes (20%) 7.5 7.5 7.5
7.0 GS Baseline (30%) 7.0 7.0 GS Baseline 7.0
Recession, Limited Cuts (20%)* GS Probability-Weighted Average
6.5 Recession, Substantial Cuts (30%)* 6.5 6.5 6.5
Market Pricing
6.0 6.0 6.0 6.0
5.5 5.5 5.5 5.5
5.0 5.0 5.0 5.0
4.5 4.5 4.5 4.5
4.0 4.0 4.0 4.0
3.5 3.5 3.5 3.5
3.0 3.0 3.0 3.0
2.5 2.5 2.5 2.5
2.0 2.0 2.0 2.0
1.5 1.5 1.5 1.5
1.0 1.0 1.0 1.0
0.5 0.5 0.5 0.5
0.0 0.0 0.0 0.0
Mar-22 Sep-22 Mar-23 Sep-23 Mar-24 Sep-24 Mar-25 Sep-25 Mar-22 Sep-22 Mar-23 Sep-23 Mar-24 Sep-24 Mar-25 Sep-25
* The recession scenarios show unrealistically slow cuts to capture
many sub-scenarios of recessions starting at various points in time.

Source: Goldman Sachs Global Investment Research

The Risks to Our Forecast of a Soft Landing

Why do our views differ from consensus? Why do we think the Fed can achieve a soft
landing now when it couldn’t in the 1960s and 1970s? And what would lead us to
forecast a recession instead?

Relative to consensus, we expect roughly in-line inflation, a lower unemployment rate,

higher GDP growth, and a slightly higher peak funds rate. On inflation, there is
substantial disagreement among forecasters, but little of it appears to be driven by
differences in unemployment rate forecasts—that is, by traditional Phillips curve effects.
Instead, it is likely driven by views on whether resolving pandemic dislocations in the
goods sector will deliver a long-awaited deflationary impulse. This has proven hard to
time so far, but we think the process is finally on track. On the unemployment rate, we
expect a smaller increase because we continue to take an optimistic view in the
Beveridge curve debate. Our growth forecast is above consensus and our recession
odds are below consensus even though our Fed forecast is slightly more hawkish than
consensus because we expect demand to prove more resilient next year, and because
our models imply that the drag on growth from the tightening in financial conditions is
peaking now, whereas others likely expect the “long and variable lags” of monetary
policy to peak later.

18 November 2022 13
Goldman Sachs US Economics Analyst

Exhibit 14: Relative to Consensus, We Expect a Slightly More Favorable Inflation-Unemployment Tradeoff and See Less Risk of Recession
Despite Having a Slightly More Hawkish Fed Forecast
Consensus Forecasts of End-2023 Unemployment Rate Consensus Forecasts of Peak Fed Funds Rate
vs. End-2023 Core PCE Inflation, October WSJ Survey vs. Recession Probability, October WSJ Survey
7 100

90
Forecast for End-2023 Core PCE Inflation

6
80

Probability of Recession
70
5
60

4 50

40
3 GS Forecast
GS Forecast
30

2 20

10
1 0
2 3 4 5 6 7 3.0 3.5 4.0 4.5 5.0 5.5 6.0
Forecast for End-2023 Unemployment Rate Forecast for Peak Fed Funds Rate

Source: Wall Street Journal, Goldman Sachs Global Investment Research

Why do we think the Fed can reverse overheating more successfully today than it could
in the 1960s and 1970s? One reason is that the problem is less serious today: a part of
the inflation overshoot still reflects pandemic-related supply-demand imbalances that
will fade on their own; job openings are very elevated, but the
employment-to-population ratio is not unsustainably high; and while short-term inflation
expectations are high, long-term inflation expectations remain anchored, meaning that
there is not yet a perception of high inflation as a new normal that only a deep recession
could cure. Another reason is that monetary policymakers today have a more
sophisticated understanding of both inflation dynamics and their policy tools, are more
politically independent, and have better real-time data for monitoring the economy.
Achieving a soft or at least “softish” landing is in large part a question of calibrating
policy tightening correctly, and while this isn’t easy, it has gone well so far this year.

Exhibit 15: Short-Term Inflation Expectations Remain High, but Long-Term Expectations Are Anchored
Percent Percent Percent Percent
7 Business Inflation Expectations 7 7.0 Household Inflation Expectations 7.0

6 GS Business Inflation Expectations Index 6 6.5 6.5

GS Company Price Announcement Index* UMich Next 1yr
5 5 6.0 UMich Next 5-10yr 6.0
NY Fed 1yr Ahead
4 4 5.5 5.5
NY Fed 3yr Ahead
5.0 5.0
3 3
4.5 4.5
2 2
4.0 4.0
1 1
3.5 3.5
0 0
3.0 3.0
-1 -1 2.5 2.5

-2 -2 2.0 2.0
2010 2012 2014 2016 2018 2020 2022
* Share of sentences mentioning higher prices less share of sentences mentioning lower 1.5 1.5
prices, rescaled to PCE inflation. 2010 2012 2014 2016 2018 2020 2022

Source: Federal Reserve, University of Michigan, Goldman Sachs Global Investment Research

18 November 2022 14
Goldman Sachs US Economics Analyst

What would make us change our mind? We would raise our recession odds if the
benign labor market adjustment led by a decline in job openings stops, if elevated
near-term inflation expectations in the business sector make a return to pre-pandemic
labor market conditions less effective in bringing down wage growth and inflation than
we are assuming, or if new global supply shocks such as another large jump in energy
prices add to inflation momentum and make the Fed’s task even harder.

David Mericle

18 November 2022 15
Goldman Sachs US Economics Analyst

The US Economic and Financial Outlook

THE US ECONOMIC AND FINANCIAL OUTLOOK
(% change on previous period, annualized, except where noted)
2020 2021 2022 2023 2024 2025 2022 2023
(f) (f) (f) (f) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

OUTPUT AND SPENDING

Real GDP -2.8 5.9 1.9 1.1 1.6 1.9 -1.6 -0.6 2.6 0.9 0.8 1.0 1.3 1.3
Real GDP (annual=Q4/Q4, quarterly=yoy) -1.5 5.7 0.3 1.1 1.9 1.9 3.7 1.8 1.8 0.3 0.9 1.3 1.0 1.1
Consumer Expenditures -3.0 8.3 2.8 1.9 1.8 1.9 1.3 2.0 1.4 3.3 1.5 1.5 1.5 1.5
Residential Fixed Investment 7.2 10.7 -10.2 -15.8 -0.1 2.0 -3.1 -17.8 -26.4 -21.3 -17.5 -10.0 -5.0 0.0
Business Fixed Investment -4.9 6.4 3.3 1.9 3.3 3.6 7.9 0.1 3.7 0.1 2.1 2.3 2.4 3.0
Structures -10.1 -6.4 -9.5 -4.8 2.4 3.0 -4.4 -12.7 -15.4 -10.9 0.0 0.0 1.0 2.0
Equipment -10.5 10.3 4.5 2.0 2.6 3.0 11.4 -2.1 10.8 0.0 1.0 1.5 1.5 2.5
Intellectual Property Products 4.8 9.7 8.8 4.9 4.3 4.5 10.8 8.9 6.9 5.5 4.0 4.0 4.0 4.0
Federal Government 6.2 2.3 -3.1 -0.8 -0.1 0.0 -5.3 -3.4 3.7 -3.0 -1.0 -1.0 0.0 0.0
State & Local Government 0.4 -0.5 0.3 0.8 1.0 1.0 -0.4 -0.6 1.7 0.2 1.0 1.0 1.0 1.0
Net Exports ($bn, '12) -923 -1,233 -1,369 -1,304 -1,351 -1,371 -1,489 -1,431 -1,274 -1,282 -1,282 -1,296 -1,308 -1,329
Inventory Investment ($bn, '12) -55 -19 112 75 66 60 215 110 62 61 75 75 75 75
Industrial Production, Mfg. -6.3 5.7 3.5 1.5 2.5 3.2 3.6 3.2 0.3 1.7 1.4 1.5 1.8 2.1

HOUSING MARKET
Housing Starts (units, thous) 1,395 1,605 1,613 1,570 1,570 1,570 1,720 1,647 1,458 1,627 1,570 1,570 1,570 1,570
New Home Sales (units, thous) 831 769 631 549 722 786 776 609 608 533 496 528 559 613
Existing Home Sales (units, thous) 5,638 6,127 5,057 3,831 4,147 4,509 6,057 5,373 4,770 4,028 3,750 3,793 3,858 3,924
Case-Shiller Home Prices (%yoy)* 9.5 18.8 6.7 -7.5 -2.2 3.8 20.0 19.6 13.1 6.7 -1.0 -7.4 -8.2 -7.5

INFLATION (% ch, yr/yr)

Consumer Price Index (CPI)** 1.3 7.1 6.8 3.2 2.6 2.5 8.0 8.6 8.3 7.2 5.7 4.0 3.2 3.1
Core CPI ** 1.6 5.5 5.9 3.2 2.7 2.5 6.3 6.0 6.3 6.1 5.6 4.7 3.8 3.3
Core PCE** † 1.5 5.0 4.5 2.9 2.4 2.2 5.3 5.0 4.9 4.7 4.1 3.7 3.3 2.9

LABOR MARKET
Unemployment Rate (%)^ 6.7 3.9 3.6 4.1 4.2 4.2 3.6 3.6 3.5 3.6 3.8 3.9 4.0 4.1
U6 Underemployment Rate (%)^ 11.7 7.3 6.7 7.7 8.0 7.9 7.0 6.6 6.7 6.7 7.0 7.2 7.5 7.7
Payrolls (thous, monthly rate) -774 562 370 29 52 60 539 349 381 212 40 25 25 25
Employment-Population Ratio (%)^ 57.4 59.5 60.0 59.6 59.4 59.2 60.1 59.9 60.1 60.0 59.9 59.8 59.7 59.6
Labor Force Participation Rate (%)^ 61.5 61.9 62.3 62.2 62.0 61.8 62.4 62.2 62.3 62.3 62.3 62.2 62.2 62.2
Average Hourly Earnings (%yoy) 4.9 4.2 5.1 4.2 3.7 3.3 5.4 5.3 5.1 4.7 4.5 4.4 4.1 4.0

GOVERNMENT FINANCE
Federal Budget (FY, $bn) -3,132 -2,775 -1,375 -1,250 -1,350 -1,600 -- -- -- -- -- -- -- --

FINANCIAL INDICATORS
FF Target Range (Bottom-Top, %)^ 0-0.25 0-0.25 4.25-4.5 5-5.25 4.25-4.5 3.5-3.75 0.25-0.5 1.5-1.75 3-3.25 4.25-4.5 4.75-5 5-5.25 5-5.25 5-5.25
10-Year Treasury Note^ 0.93 1.52 3.75 4.00 3.75 3.65 2.32 2.98 3.83 3.75 3.90 4.00 4.00 4.00
Euro (€/$)^ 1.22 1.13 0.99 1.05 1.10 1.10 1.11 1.05 0.98 0.99 0.95 0.98 1.02 1.05
Yen ($/¥)^ 103 115 144 125 115 115 121 136 145 144 145 133 128 125
* Weighted average of metro-level HPIs for 381 metro cities where the weights are dollar values of housing stock reported in the American Community Survey. Annual numbers are Q4/Q4.
** Annual inflation numbers are December year-on-year values. Quarterly values are Q4/Q4.
† PCE = Personal consumption expenditures. ^ Denotes end of period.
Note: Published figures in bold.
Source: Goldman Sachs Global Investment Research.

Source: Goldman Sachs Global Investment Research

18 November 2022 16
Goldman Sachs US Economics Analyst

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18 November 2022 20
Since Disneyland® Park opened in 1955, our Guests have treasured the
elements that set our Disney theme parks and resorts apart – the cleanest
venues, the friendliest Cast Members and the most exceptional show. A big
part of that show is you, with your quick smile, your eagerness to help, and your
willingness to maintain the Disney Look that our Guests have come to associate
with our very special brand.
As a Cast Member at the Disneyland® Resort, the Walt Disney World® Resort or
Disney Vacation Club property, you are a personal representation of the Disney
tradition of excellence. Our themed costumed Cast Members are a critical
part of enhancing the experience of our Disney show, and our non-costumed
Cast Members also play an important role as representatives of the Disney
brand. Regardless of your role, when you take pride in your appearance, you
become a role model for those around you, and you convey the attitude of
excellence that has become synonymous with the Disney name. The Disney
Look in conjunction with The Four Keys Basics – Safety, Courtesy, Show and
Efficiency ensure Walt Disney’s vision for a great Guest experience.
The Disney Look is a classic look that is clean, natural, polished
and professional, and avoids “cutting edge” trends or extreme
styles. It is designed with our costumed and non-costumed Cast
Members in mind.
The following guidelines have been developed to
establish consistency and to maintain the quality
and integrity of the Disney brand. As you read this handbook,
remember that you are the key to keeping our heritage alive
and creating an unparalleled experience for our Guests each and
every day.

1
 Table of Contents

Introduction 1

Good Judgment and Stage Presence 3

Guidelines for All Cast Members 4

Company Identification Cards, Eyewear, Body Modification or Alteration, Personal Hygiene,
Nametags, Pins and Buttons, Personal Protective Equipment, Undergarments

Medical and Religious Accommodations 8

Females
All Female Cast Members 9
Fingernails, Hairstyling, Hair Coloring, Makeup
Costumed Females 10
Costumes, Entertainers, Footwear, Hair Confinement and Accessories, Headwear,
Jewelry, Personal Electronic Devices
Non-Costumed Females 13
Business Attire, Clothing Lengths, Fabrics and Patterns, Footwear,
Hair Accessories, Headwear, Jewelry

Males
All Male Cast Members 16
Facial Hair, Fingernails, Hairstyling and Sideburns, Hair Coloring
Costumed Males 20
Costumes, Entertainers, Footwear, Headwear, Jewelry, Personal Electronic Devices
Non-Costumed Males 22
Business Attire, Fabrics and Patterns, Footwear, Headwear, Jewelry

Discipline Policy 24

Quick Search 25

2
 Good Judgment and Stage Presence

The Disney Look appearance guidelines present a standard to be upheld by all Cast
Members to ensure the best show to our Guests. The expected behavior of each Cast
Member is to be courteous, conscientious and exhibit good judgment at all times to
benefit the organization, fellow Cast Members, and Guests. For this reason, if you are
ever in doubt about the appropriateness of your appearance, please keep in mind that
anything that could be considered distracting or not in the best interest of our Disney
show will not be permitted.

No matter where you work or what your role

is, anytime you are in a public area, you are
onstage. Your attitude and performance are
direct reflections on the quality of our Disney
show. Often, it’s the seemingly little things that
detract from our Guests’ enjoyment – chewing
gum, having poor posture, using a cellular phone or
frowning. Of course, smoking and eating onstage
are also strictly prohibited. All of this adds up to
one of the most important aspects of your role in
our show: good stage presence.

3
 Guidelines for All Cast Members
COMPANY IDENTIFICATION CARDS
To help ensure the safety and security of our Guests and Cast Members, all Cast
Members are required to follow the policy below regarding company ID cards.
Costumed Cast: Cast Members in costume must have their company ID with them at
all times. Your role and costume will dictate the location of your ID and how it should
be worn.
Non-costumed Cast: Cast Members who are not wearing a costume are required to
visibly wear their company photo ID card in backstage areas at all
times. Non-costumed Cast Members are not required to wear
their company ID while onstage but may choose to do so for
convenience. Your company ID may be worn on a pin-trading
lanyard or conservative-style solid black lanyard that is free from
words or logos. Black lanyards that have a cloisonné Character
attachment are also permitted. As a reminder, nametags, buttons,
etc. are not permitted on the lanyard.
Photo ID Requirement: Cast Members with a company ID
card that does not include a photo must be prepared to show
secondary photo identification (driver’s license, state identification
card, etc.) in conjunction with their company ID card.

EYEWEAR
Sunglasses are a block to interpersonal communication with Guests
and should be avoided if possible. Only sunglasses that allow your
eyes to be seen are permitted. No mirrored or dark,
opaque lenses are allowed. Sunglasses are not to be worn at night,
in dark areas or indoors. Cast Members should remove sunglasses
when engaging in extended interactions with a Guest. Sunglasses
should not be visible when not in use.
4
 Cast Members
The frames and lenses of both prescription eyeglasses and sunglasses should be a

All
conservative color and style with only minimal contrasting logos. Eyeglasses and
sunglasses should not detract from the costume or contradict the theme of the show.
If colored or tinted contact lenses are worn, the resulting eye color must be natural-
looking. Decorated lenses are not permitted, nor are any looks that would be
considered distracting or not in the best interest of our Disney show.

BODY MODIFICATION OR ALTERATION

Intentional body modification or alteration for the purpose of achieving a visible, physical
effect that disfigures, deforms or similarly detracts from a professional
image is prohibited. Examples include, but are not limited to:
visible tattoos, brands, body piercing (other than traditional ear
piercing for females), tongue piercing or splitting, tooth filing,
earlobe expansion and disfiguring skin implants.
Tattoos must be discreetly and completely covered at
all times. Jewelry, spacers, retainers or plugs are not
permitted in any body piercing while working.

PERSONAL HYGIENE
Due to close contact with Guests and fellow Cast
Members, regular bathing; frequent hand washing; clean,
neat hair; and the use of an antiperspirant or deodorant
is required. For the same reasons, the use of strong, heavy
scents and fragrances is not permitted.

5
 NAMETAGS, PINS AND BUTTONS
We are a first-name organization. Your nametag should be worn with pride in an upright,
readable position on the upper left shoulder area of the outermost layer of clothing.
Based on costume design, this placement may occasionally vary. Please check with
your area leader for clarification. Nametags should not be worn on lanyards, ties, hats,
waistbands or on shirt or blouse collars.
Nametags should be kept in good show condition with no visible chips or scratches.
All names on company nametags shall be the Cast Members’ full, legal, first or middle
name or a derivative of their name. Cast Members are permitted to have their
hometown city and state or country engraved on the nametag. Participants in the
College Program may choose to have the name of their college or university in place of
their hometown.
Cast Members with additional language skills may participate in the Language Program.
Language Program participants may receive a special nametag that can identify multiple
languages spoken.
Please refer to The Walt Disney Legacy Award module on The Hub to access the current
policy for wearing the Legacy Award nametag and pin.
All Cast Members have the option of wearing their most recent service pin, site-specific
recognition pin, and/or Walt Disney World® 1971 Opening Team pin on their nametags, in
addition to any approved language flags. Stickers or other decorations are not permitted
on the nametag or costume.
Cast Members may wear up to two separate approved pins/buttons directly on the
costume. Cast Members should wear these pins opposite the nametag, although this
placement may occasionally vary. Any request to allow a pin or button to be worn on
the costume must be approved in advance by the Cast Image and Appearance team.

6
 The Disney Look: Guidelines for All Cast Members
PERSONAL PROTECTIVE EQUIPMENT
Personal protective equipment (PPE) may be required to safely perform your role. This
could include, but is not limited to items such as safety vests and safety glasses. Please
remember to maintain the Disney Look while wearing personal protective equipment.
For additional information see your leader or the Walt Disney Parks and Resorts Safety
module on The Hub.

UNDERGARMENTS
Cast Members are required to wear appropriate
undergarments at all times. Patterned or colored
undergarments that are visible when worn under light-
colored costumes or business attire are not permitted.
Undergarments should not be visible at any time.

Costumed Cast Members may wear a solid white

crewneck or V-neck undershirt under costumes
with a traditional neckline. Undershirts should
be only minimally visible at the neckline and should
not extend past the sleeves. Non-costumed Cast
Members may wear any solid color undershirt that is
complementary to the outfit.

7
 Medical and Religious Accommodations

MEDICAL ACCOMMODATION REQUESTS

• Reasonable accommodations are provided to Cast Members under the Disney Look
for medical restrictions.
• A Cast Member may request a medical accommodation by completing and sending to
Ability Management a completed Request for Medical Accommodation in Employment
form and a Physician’s Certification for Employee Accommodations. These forms are
available on WDPR’s intranet (The Hub).
• Ability Management will evaluate the information provided, and manage the process to
provide a timely response to the Cast Member.
• Ability Management is available to discuss any questions or concerns the Cast Member
may have.
RELIGIOUS ACCOMMODATION REQUESTS
• Reasonable accommodations are provided to Cast Members under the Disney Look
for sincerely-held religious beliefs.
• A Cast Member may request a religious accommodation by completing and sending
to Employee Relations a Religious Accommodation Request form that is available on
WDPR’s intranet (The Hub).
• Employee Relations will meet with the Cast Member to determine the Cast Member’s
specific, individual needs and will manage the process to provide a timely response to
the Cast Member.
• Employee Relations is available to discuss any questions or concerns the Cast Member
may have.

8
Guidelines for All Female Cast Members

FINGERNAILS
Fingernails should be clean. If polish is used, it should be an appropriate, neutral color.
This includes deeper, richer shades of polish. Polishes that are not permitted include:
black, gold, silver, multicolored or neon. Charms or decals on fingernails are not
permitted. Fingernails should not exceed one-fourth of an inch (approximately 6 mm)
beyond the fingertip.

HAIRSTYLING
Here are the Disney Look guidelines for hairstyles:
• Hair should be neatly combed and arranged in a classic, easy-to-maintain style.
Extreme styles are not permitted.
• Hair below shoulder length should be confined if it falls forward over the face or
covers the nametag while working.
• Conservative braided hairstyles without beads or ornamentation are permitted.
• Hair products may be used to create a soft, natural hairstyle within these guidelines.
• Shaving of the head or any portion of the head or eyebrows is not permitted.
• Artificial hair is permitted if it looks natural and meets all of the above requirements.

HAIR COLORING
The Disney Look does not permit extremes in dyeing, bleaching or coloring. If the hair
color is changed, it must be natural-looking and well maintained. Subtle highlighting or
frosting is permitted, as long as it creates a uniform look over the whole head and meets
all of the previously listed guidelines.

MAKEUP
If makeup is worn, it should be applied in a blended manner and in appropriate, neutral
colors.

9
 Guidelines for Costumed Females

COSTUMES
Costumes should be clean and neat at all times. If a costume change becomes necessary
during your shift, you should report immediately to your Costuming location after
consulting with your leader. Costumes must be worn as they are designed. For example,
they should not be worn too loose, too tight, low on the hips, etc. Any questions
pertaining to the fit of a costume should be addressed with Costuming to make sure the
appearance meets the requirements for the Disney Look.
As a reminder, you are responsible for the proper care and handling of all costume
pieces issued to you. Costumes issued to you remain the property of the
company and must be returned in good condition upon request or at
the time of separation or transfer.
When wearing a costume off property, remove your nametag and do
not wear your costume for personal use. Your costume is not to be
worn when visiting Disney property as a Guest.

ENTERTAINERS
If the authentic portrayal of a role requires deviation from the
Disney Look appearance guidelines, the deviation must be
approved by the Vice President of Creative Entertainment and
notification made to the Vice President of Employee Relations
and Director of Creative Costuming. Such approval must
be documented with the Cast Image and Appearance team.
Otherwise, entertainers must adhere to the appearance guidelines
set forth in the Disney Look policy. If the performer is cross
utilized or transferred to a different role, this approved deviation
no longer applies to that performer. All performers in the same
role will need to be documented separately.

10
FOOTWEAR
The required shoes for a costumed area differ based on the role and the theming
of the costume. Before buying work shoes or hosiery, Cast Members should check
the Costuming module on The Hub or with their leaders to ensure proper style and
color.

Costumed
Females
It is recommended that Cast Members wear slip-resistant rubber-soled shoes in all
areas as a safety precaution. Approved shoes and socks are required the first day in
costume.
Cast Members are responsible for ensuring shoes are kept clean and in good repair
at all times.
Dress shoes must be solid in color with no contrasting logos or
markings and made of a polishable material such as leather.
Athletic shoes must be solid in color with no contrasting logos.
For specific guidelines, please check the Costuming module on
The Hub.

HAIR CONFINEMENT AND ACCESSORIES

In keeping with the Disney Look and costume theming, the
following guidelines for hair accessories apply:
• Accessories no larger than one inch (approximately 2.5 cm)
wide and four inches (approximately 10 cm) long are acceptable.
Headbands, hair ribbons or hair ties are acceptable, provided that
they are no wider than one inch (2.5 cm).
• Accessories must be a neutral color (silver, gold, tortoiseshell,
black, clear or pearl) or a solid color that matches the costume.
• No more than three small accessories may be worn at once.

11
 The Disney Look: Guidelines for Costumed Females
HEADWEAR
The only head coverings that may be worn are those issued by Costuming as part of the
costume. Check with Costuming for the proper positioning of headwear.

JEWELRY
• Rings, earrings and a business-style wristwatch are permitted.
• Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.
• Visible necklaces, bracelets, ankle bracelets and toe rings are not permitted. A visible
standard medical-alert necklace, bracelet or ankle bracelet is acceptable.
• Earrings must be a simple, matched pair in gold, silver or a color that
matches the costume. One earring in each ear is permitted. Earrings
may be clip-on or pierced, post, hoop or dangle and must be worn on the
bottom of the earlobe. Earrings may not exceed the size of a quarter.
• Only one ring on each hand is permitted, with the exception of a
wedding set. A ring may be worn on any finger.

PERSONAL ELECTRONIC DEVICES

Personal cellular phones and other digital assistants may not be
used onstage during work hours. These items must be concealed
from view and operated on silent mode if carried. Company-
issued cellular phones will be allowed if they are required for a
specific business need.

12
 Guidelines for Non-Costumed Females

To maintain the Disney image of excellence, clothing should be clean, neatly pressed and fit
properly. Clothing should not appear too tight, too baggy, faded or in need of repair. Remember
anything that could be considered distracting is not in the best interest of our Disney show.

BUSINESS ATTIRE
• Professional options for females include: dress pants with a blouse or sweater, a
skirted or pants suit, a dress with or without a jacket, and business-style walking

Non-Costumed
shorts with a blouse and jacket or vest.
• A blazer or suit may be required at certain times, depending on your work location

Females
and the nature of your role. Check with your area leader for more information.
• Sleeveless tops and dresses are permitted provided the sleeve width is no less than
three inches (approximately 7.6 cm). Tank tops, spaghetti straps and other casual
styles are not acceptable.
• Business-style, mid-calf capri pants are permitted. Cotton twill, cargo, leggings or
other casual styles of capri pants do not present a business image and are therefore
not permitted.
• Cotton twill pants or khakis are permitted only if they are neatly pressed, creased and
appear to be professionally laundered.
• Non-costumed Cast Members are permitted to wear a short- or long-sleeved oxford-
style dress shirt with a property-specific embroidered logo. A blazer is optional.
• In addition to the options above, non-costumed women working in Sports and
Recreation at the Walt Disney World® Resort are permitted to wear dress or golf-
style shorts no shorter than three inches (7.6 cm) above the top of the knee. Shorts
may be paired with a professional-style blouse (as detailed above) or with a neat, well-
maintained polo or golf-style shirt. Shorts are not permitted for office-based Cast in
this area.

13
 • The following clothing options are not permitted: polo or golf-style shirts (except for
Sports and Recreation Cast), cargo-style pants, t-shirts, sundresses, leggings, casual
shorts, wrap-around shorts, one-piece rompers and garments made of denim fabrics.
• Winter jackets and coats should present a professional appearance and should be
made of fabrics traditionally acceptable in business. Good fabric choices are wool,
leather and microfiber. Fabrics such as denim, nylon, satin and other casual fabrics
would not meet these guidelines.

CLOTHING LENGTHS
Dress and skirt lengths may range from three inches (7.6 cm) above
the top of the kneecap bone to the bottom of the ankle. The length
of shorts should be from the top of the kneecap bone to three
inches (7.6 cm) above the top of the kneecap bone. Slits in skirts,
kick pleats, and buttoned or snapped closures should not exceed
five inches (12.7 cm) above the middle of the knee. Pants should be
long enough to touch the bottom of the ankle.

FABRICS AND PATTERNS

Fabrics should be those traditionally acceptable for business,
such as: tweed, wool, cotton, polyester, silk, linen, rayon or blends
of these fibers. Unacceptable fabrics include: spandex, gauze,
metallic fabrics, sheer fabrics, clinging knits and denim. Patterns
that contain large graphics, large company and non-company logos,
and styles or patterns that suggest extremely casual attire are not
permitted. Sportswear is not permitted.

14
 The Disney Look: Guidelines for Non-Costumed Females
FOOTWEAR
Dress shoes or boots in good business taste are required. Dress shoes are permitted
to have an open toe, open heel and/or sling back. Athletic shoes, sandals and Western
boots are not permitted.
Hosiery is optional for non-costumed female Cast Members. If hosiery is worn, it should
be sheer or opaque hosiery in subdued shades.
HAIR ACCESSORIES
Hair accessories should be conservative and coordinate with the outfit.
HEADWEAR
Non-costumed Cast Members, while working outdoors only, may wear hats made of
natural materials, such as straw, with a small brim for protection from the sun. Hats
should be a simple style, solid tan or brown in color. Hatbands must be a solid color
similar to the color of the hat. Baseball caps are not permitted.
For questions regarding headwear, please contact your leader.
JEWELRY
• Rings, necklaces, bracelets, earrings, lapel pins and a business-style wristwatch are
permitted. A pin, brooch or scarf clip in good business taste also is acceptable.
• Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.
• Two necklaces and two bracelets in good business taste that coordinate with the
outfit and each other are permitted.
• Ankle bracelets and toe rings are not permitted.
• One earring in each ear is permitted. It must be a simple, matched set. Earrings may
be clip-on, pierced, hoop or dangle, and they must be worn on the bottom of the
earlobe. Earrings may extend up to two inches (approximately 5 cm) from the bottom
of the earlobe.
• Only one ring on each hand is permitted, with the exception of a wedding set. A ring
may be worn on any finger.

15
 Guidelines for All Male Cast Members

FACIAL HAIR
For all male Cast Members a fully grown in, well-maintained mustache, beard, or goatee
is permitted unless otherwise restricted by regulatory codes and standards. Facial hair
must be neatly trimmed and may not present an unkempt appearance. Extreme styles
are prohibited.
• All facial hair (beards, goatees and mustaches) must create an overall neat, polished
and professional look.
• All facial hair must be fully grown in, neatly groomed and well maintained at one-fourth
of an inch (approximately 6mm) in length.
• Mustaches may extend below the corners of the mouth to meet with the facial beard.
• Shaping the mustache or beard to a particular style is not permitted.
• Mustaches (without facial hair) must not extend onto or over the upper lip and must
extend to the corners of the mouth, but not beyond or below the corners.
• A well-groomed beard has a defined cheek line and neckline which is trimmed neatly.
The neck must be shaven.
• A non-shaven stubble beard is not acceptable.
Aside from approved styles, Cast Members are expected to be clean-shaven every day.
For clarification on whether facial hair is acceptable, please consult your area leader.
Entertainment Cast Members, please consult your local Management for approval. If
additional assistance is needed, contact the Cast Image and Appearance team.

FINGERNAILS
Clean, presentable fingernails are a must. Fingernails should not extend beyond the tip
of the finger.

16
 The Disney Look: Guidelines for All Males

Acceptable Facial Hair

Unacceptable Facial Hair

17
 Acceptable Hairstyles

Unacceptable Hairstyles

18
 The Disney Look: Guidelines for All Males

HAIRSTYLING AND SIDEBURNS

Here are the Disney Look guidelines for hairstyles:
• Hair must be neatly cut on the back and sides, forming a smooth, symmetrical
appearance so that it does not extend beyond or cover any part of the ears or the
shirt collar. The overall style must be neat, natural and balanced proportionally.
• A shaved head is permitted, as well as a very short military-style cut. Shaving of the
eyebrows is not permitted.
• Conservative braided hairstyles for males without beads or ornamentation are
permitted. They must be styled above the ears, cut above the collar and be neatly
braided close to the scalp in straight rows.
• Tucking hair behind the ears, or pinning or tucking it under a hat to conceal an
unacceptable hairstyle, is not permitted.
• Extreme or bi-level styles are not permitted.
• Hair products may be used to create a soft, natural hairstyle within these guidelines.
• Artificial hair is permitted if it looks natural and meets all of the above requirements.
• Sideburns should be neatly trimmed, straight and even in width, and are permitted to
extend to the bottom of the earlobe. They should blend naturally from the hairline
and from the length of hair on the head.
• Flares, muttonchops or pencil-thin sideburns are not permitted.

HAIR COLORING
The Disney Look does not permit extremes in dyeing, bleaching or coloring. If hair
color is changed, it must be natural-looking and well maintained. Subtle highlighting or
frosting is permitted as long as it creates a uniform look over the whole head and meets
all of the previously listed guidelines.

19
 Guidelines for Costumed Males
COSTUMES
Costumes should be clean and neat at all times. If a costume change becomes necessary
during your shift, you should report immediately to your Costuming location, after
consulting with your leader. Costumes must be worn as they are designed. Any
questions pertaining to the fit of a costume should be addressed with Costuming to make
sure the appearance meets the requirements for the Disney Look.
As a reminder, you are responsible for the proper care and handling of all costume pieces
issued to you. Costumes issued to you remain the property of the company
and must be returned in good condition upon request or at the time of
separation or transfer.
When wearing a costume off property, remove your nametag and do not
wear your costume for personal use. Your costume is not to be worn
when visiting property as a Guest.
ENTERTAINERS
If the authentic portrayal of a role requires deviation from the
Disney Look appearance guidelines, the deviation must be approved
by the Vice President of Creative Entertainment and notification
made to the Vice President of Employee Relations and Director of
Creative Costuming. Such approval must be documented with the
Cast Image and Appearance team. Otherwise, entertainers must
adhere to the appearance guidelines set forth in the Disney Look
policy. If the performer is cross utilized or transferred to a different
role, this approved deviation no longer applies to that performer. All
performers in the same role will need to be documented separately.
FOOTWEAR
The required shoes for a costumed area differ based on the role and
the theming of the costume. Before buying work shoes and socks, Cast
20
 The Disney Look: Guidelines for Costumed Males
Members should check the Costuming module on The Hub or with their leaders to
ensure proper style and color.
It is recommended that Cast Members wear slip-resistant rubber-soled shoes in all areas
as a safety precaution. Approved shoes and socks are required the first day in costume.
Cast Members are responsible for ensuring shoes are kept clean and in good repair at all
times.
Dress shoes must be solid in color with no contrasting logos or markings and made of a
polishable material such as leather.
Athletic shoes must be solid in color with no contrasting logos. For specific
guidelines, please check the Costuming module on The Hub.
HEADWEAR
The only head coverings that may be worn are those issued by Costuming
as part of the costume. Check with Costuming for proper positioning of
headwear.
JEWELRY

Costumed
• Rings, a small tie tack, and a business-style wristwatch are permitted.

Males
• Watch bands must be black, white, brown, silver or gold tone and
should have only minimal ornamentation.
• Visible necklaces, bracelets and ankle bracelets are not permitted. A
visible standard medical-alert necklace, bracelet or ankle bracelet is
acceptable.
• Only one ring on each hand is permitted. A ring may be worn on any
finger.
• Earrings are not permitted.
PERSONAL ELECTRONIC DEVICES
Personal cellular phones and other digital assistants may not be used
onstage during work hours. These items must be concealed from view and
operated on silent mode if carried. Company-issued cellular phones will be
allowed if they are required for a specific business need. 21
 Guidelines for Non-Costumed Males

To maintain the Disney image of excellence, clothing should be clean, neatly pressed and fit
properly. Clothing should not appear too tight, too baggy, faded or in need of repair. Remember
anything that could be considered distracting is not in the best interest of our Disney show.
BUSINESS ATTIRE
• Professional options for males include: dress trousers and a short- or long-sleeved
professional dress shirt are required. Shirts must be tucked in, with the exception of
camp-style dress shirts and sweaters specifically tailored otherwise.
• A tie, sport coat or suit may be required at certain times, depending
on your work location and the nature of your role. Check with your
area leader for more information.
• Cotton twill trousers or khakis are permitted only if they are neatly
pressed, creased and appear to be professionally laundered.
• Non-costumed Cast Members are permitted to wear a short- or
long-sleeved oxford-style dress shirt with a property-specific
embroidered logo. Sport coats, blazers and ties are optional.
• In addition to the options above, non-costumed men working in
Sports and Recreation at the Walt Disney World® Resort are
permitted to wear dress or golf-style shorts no shorter than three
inches (7.6 cm) above the top of the knee. Shorts may be paired
with a professional-style shirt (as detailed above) or with a neat,
well-maintained polo or golf-style shirt. Shorts are not permitted for
office-based Cast in this area.
• The following clothing options are not permitted: polo or golf-style
shirts (except for Sports and Recreation Cast), cargo-style trousers,
t-shirts and garments made of denim fabrics.
• Winter jackets and coats should present a professional appearance and
should be made of fabrics traditionally acceptable in business. Good
fabric choices are wool, leather and microfiber. Fabrics such as denim,
nylon, satin and other casual fabrics would not meet these guidelines.
22
 The Disney Look: Guidelines for Non-Costumed Males
FABRICS AND PATTERNS
Fabrics should be those traditionally acceptable for business, such as: tweed, wool,
cotton, polyester, silk, linen, rayon or blends of these fibers. Unacceptable fabrics
include: spandex, metallic fabrics, sheer fabrics, clinging knits, and denim. Patterns that
contain large graphics, large company and non-company logos, and styles or patterns
that suggest extremely casual attire are not permitted. Sportswear is not permitted.

FOOTWEAR
Dress shoes and socks in good business taste are required. Sandals, athletic shoes,
Western boots and deck shoes are not permitted.

HEADWEAR
Non-costumed Cast Members, while working outdoors only, may wear hats made of
natural materials, such as straw, with a small brim for protection from the sun.
Hats should be a simple style, solid tan or brown in color. Hatbands must be
a solid color similar to the color of the hat. Baseball caps and visors are not
permitted.
For questions regarding headwear, please contact your leader.

JEWELRY
• Lapel pins, tie bars or clips, collar bars, cufflinks, rings, a bracelet, a
necklace and a business-style watch are permitted.
• Watch bands must be black, white, brown, silver or gold

Non-Costumed
tone and should have only minimal ornamentation.
• One bracelet and one necklace, in good business taste, in

Males
gold, silver or a color that coordinates with your clothing is
permitted. The width of the bracelet may not exceed one-
half inch (1.3 cm). Ankle bracelets are
not permitted.
• Only one ring on each hand is permitted. A ring may be
worn on any finger.
• Earrings are not permitted.
23
 Discipline Policy

The appearance guidelines contained in this handbook have been established for
Disneyland® Resort, Walt Disney World® Resort, and Disney Vacation Club properties
and may be changed at any time. Failure of any Cast Member to adhere to these or any
subsequently established or modified standards will result in appropriate disciplinary
action, not excluding separation from the company. Cast Members, including those
covered by a collective bargaining agreement, may be disciplined when the appearance
policy is not followed.

Ensuring consistent administration of the Disney Look is the responsibility of local

leadership and your Human Resources representative and Employee/Labor Relations.
Questions regarding deviations from the policy should be referred to the Cast Image
and Appearance team and Employee Relations for further assessment.

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Quick Search Costumed Females

This is a quick reference guide. Full details and guidelines are provided in the main sections of the book.
Bracelets Only a standard medical-alert bracelet is acceptable visibly.
Company ID Must have with you at all times and be worn appropriately.
Contact Lenses Eye color must be natural-looking.
Earrings May not exceed the size of a quarter, must be matching pair.
Eyewear Conservative color and style with only minimal logos.
Footwear Footwear should be in good repair, solid in color and a polishable material.
Hair Accessories Up to three, must be solid neutral or color that matches the costume.
Hair Color Natural-looking and well maintained.
Hairstyle Neatly combed and arranged. Extreme styles are not approved.
Highlights Subtle highlighting is allowed as long as it creates a uniform look.
Hosiery Hosiery is determined by theme and costume design. Confirm with Costuming.
Makeup Natural-looking and well blended.
Nails Should not exceed one fourth of an inch beyond the tip. Nail polish, if used, should
be appropriate, neutral color. No decals.
Nametag Worn on the upper left shoulder area of outermost layer of clothing. Must be in
“good show” condition.
Necklaces Only a standard medical-alert necklace is acceptable visibly.
Personal Electronic Personal devices must be silent, concealed and are not allowed to be used onstage.
Devices
Rings Only one ring on each hand, with the exception of a wedding set.
Socks Socks are determined by theme and costume design. Confirm with Costuming.
Sunglasses Conservative color and style with only minimal logos. Mirrored and/or extreme

Quick Search
dark lenses are not allowed.
Watches Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.
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 Quick Search Non-Costumed Females

This is a quick reference guide. Full details and guidelines are provided in the main sections of the book.

Bracelets Two bracelets in good business taste that coordinate with the outfit are approved.
Company ID Must have with you at all times and be worn appropriately.
Contact Lenses Eye color must be natural-looking.
Earrings May extend up to two inches (approximately 5 cm), must be matching pair.
Eyewear Conservative color and style with only minimal logos.
Footwear Dress shoes or boots in good business taste are required.
Hair Accessories Hair accessories should be conservative and coordinate with the outfit.
Hair Color Natural-looking and well maintained.
Hairstyle Neatly combed and arranged. Extreme styles are not approved.
Highlights Subtle highlighting is allowed as long as it creates a uniform look.
Hosiery If hosiery is worn, it should be sheer or opaque hosiery in subdued shades.
Makeup Natural-looking and well blended.
Nails Should not exceed one fourth of an inch beyond the tip. Nail polish if used should
be appropriate, neutral color. No decals.
Nametag Worn on the upper left shoulder area of outermost layer of clothing. Must be in
“good show” condition.
Necklaces Two necklaces in good business taste that coordinate with the outfit are approved.
Rings Only one ring on each hand, with the exception of a wedding set.
Sunglasses Conservative color and style with only minimal logos. Mirrored and/or extreme
dark lenses are not allowed.
Watches Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.

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Quick Search Costumed Males

This is a quick reference guide. Full details and guidelines are provided in the main sections of the book.

Bracelets Only a standard medical-alert bracelet is acceptable visibly.

Company ID Must have with you at all times and be worn appropriately.
Contact Lenses Eye color must be natural-looking.
Earrings Not permitted.
Eyewear Conservative color and style with only minimal logos.
Facial Hair Must be a fully grown-in and approved option or clean shaven.
Footwear Footwear should be in good repair, solid in color and a polishable material.
Hair Color Natural-looking and well maintained.
Hairstyle Neatly cut, forming a symmetrical appearance and ending above the ears and shirt
collar.
Highlights Subtle highlighting is allowed as long as it creates a uniform look.
Nails Clean, presentable and not extending beyond the tip of the finger.
Nametag Worn on the upper left shoulder area of outermost layer of clothing. Must be in
“good show” condition.
Necklaces Only a standard medical-alert necklace is acceptable visibly.
Personal Electronic Personal devices must be silent, concealed and are not allowed to be used onstage.
Devices
Rings Only one ring on each hand.
Sideburns Must be neatly trimmed, straight, even in width, and permitted to extend to the
bottom of the earlobe
Socks Socks are determined by theme and costume design. Confirm with Costuming.
Sunglasses Conservative color and style with only minimal logos. Mirrored and/or extreme
dark lenses are not allowed.
Watches Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.
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 Quick Search Non-Costumed Males

This is a quick reference guide. Full details and guidelines are provided in the main sections of the book.

Bracelets One bracelet in good business taste that coordinates with the outfit.
Company ID Must have with you at all times and be worn appropriately.
Contact Lenses Eye color must be natural-looking.
Earrings Not permitted.
Eyewear Conservative color and style with only minimal logos.
Facial Hair Must be a fully grown-in and approved option or clean shaven.
Footwear Dress shoes and socks in good business taste are required.
Hair Color Natural-looking and well maintained.
Hairstyle Neatly cut, forming a symmetrical appearance and ending above the ears and shirt
collar.
Highlights Subtle highlighting is allowed as long as it creates a uniform look.
Nails Clean, presentable and not extending beyond the tip of the finger.
Nametag Worn on the upper left shoulder area of outermost layer of clothing. Must be in
“good show” condition.
Necklaces One necklace in good business taste that coordinates with the outfit.
Rings Only one ring on each hand is acceptable.
Sideburns Must be neatly trimmed, straight, even in width, and permitted to extend to the
bottom of the earlobe
Socks Dress socks in good business taste are required.
Sunglasses Conservative color and style with only minimal logos. Mirrored and/or extreme
dark lenses are not allowed.
Watches Watch bands must be black, white, brown, silver or gold tone and should have only
minimal ornamentation.

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©Disney 2014