MCD McDonalds Corp

By Allison Prang 

Walt Disney Co., Lyft Inc. and McDonald's Corp. are among the major companies that will provide quarterly updates to investors this week, as Wall Street nears the end of another earnings season.

The coronavirus pandemic has hit the businesses of those three companies in different ways. Covid-19 has changed consumers' dining-out habits, lowered demand for ride-shares and led to restrictions at theme parks and movie theaters -- while increasing the interest in streaming-video options at home.

The companies' results come toward the end of earnings season, with 89% of the S&P 500 already having reported quarterly financials as of Friday, according to FactSet.

Disney is slated to reveal its fiscal fourth-quarter results on Thursday. The Wall Street Journal reported this month that Disney-owned ESPN was cutting its staff by about 10%. Disruptions from the Covid-19 pandemic have dinged the sporting-events industry as well as the theme-park business, a prominent revenue stream for Disney.

Investors will see how Disney's year-old streaming business, Disney+, is performing during a time when people are staying at home more because of the pandemic. There were 57.5 million paid Disney+ subscribers as of June 27, but the pandemic has made producing new content for the platform difficult.

"We had a lot of really great content that was queued up to be produced and have a nice cadence as it was put onto the service, and that has slowed a bit because we haven't been able to do a lot of those productions," Disney finance chief Christine McCarthy said in September.

Subscribers at streaming competitor Netflix Inc. rose by 2.2 million in the quarter ended Sept. 30, less than in the first two quarters this year and less than the 2.5 million that the company had targeted. Netflix said the slower growth followed strong subscriber gains in the first half, when pandemic lockdowns stoked demand for its streaming service.

Analysts surveyed by FactSet expect Disney to report a loss for the latest three-month period. In August, the company logged its first quarterly loss since 2001. Analysts expect quarterly revenue to top $14 billion, substantially below the $19.1 billion in the year-earlier period.

McDonald's, which is scheduled to report its third-quarter results on Monday, said last month that sales at stores open at least 13 months fell 2.2% for the period. Analysts are expecting the company's total revenue to decline slightly from a year earlier. The pandemic has deterred indoor dining and eating out, while also crimping demand for breakfast items at fast-food chains.

Ride-hailing company Lyft is slated to report on its third quarter on Tuesday, and analysts are expecting its revenue to rise from the second quarter but amount to only about half of the year-earlier total.

Competitor Uber Technologies Inc. last week reported a smaller loss, compared with the year-earlier quarter even as gross bookings for rides fell 53%. Uber Eats' bookings, meanwhile, more than doubled.

Other companies on the docket to report in the coming week include Beyond Meat Inc., Nikola Corp., D.R. Horton Inc., Cisco Systems Inc. and newly public Palantir Technologies Inc.

Of the S&P 500 companies that have already reported, according to FactSet, 86% have exceeded analysts' earnings estimates and 79% have topped revenue expectations.

Overall, earnings for S&P 500 companies are on track to fall 7.5% from the year-earlier quarter, FactSet said, based on actual results and estimates for those companies yet to report. Revenue is expected to drop by 1.7%.

Write to Allison Prang at allison.prang@wsj.com

(END) Dow Jones Newswires

November 08, 2020 08:14 ET (13:14 GMT)

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