The Walt Disney Company: FY2024 Financials & Cash-Flow Analysis

Income statement trends#

The Walt Disney Company ([DIS]) closed fiscal 2024 with $91.36B in revenue, up +2.77% year‑over‑year, while operating income rose to $11.91B (+32.48%) and reported net income on the income statement was $4.97B (+111.49%). Those headline moves compress a story of steady top‑line growth but meaningful margin expansion and a large year‑over‑year jump in reported net profit. The combination — modest revenue growth, stronger operating leverage and a lower effective tax burden in FY2024 compared with FY2023 — is the proximate explanation for the net‑income surge.

To show the arithmetic explicitly: revenue growth = (91.36 - 88.90) / 88.90 = +2.77%; operating income growth = (11.91 - 8.99) / 8.99 = +32.48%; net income growth = (4.97 - 2.35) / 2.35 = +111.49%. Those year‑over‑year rates are calculated directly from the company fiscal figures for the years ending 2024 and 2023 found in the dataset.

Margin compression and expansion are visible at multiple levels. Gross margin improved to 35.75% in FY2024 (32.66 / 91.36 = 35.75%), operating margin rose to 13.04% (11.91 / 91.36 = 13.04%), and EBITDA margin reached 16.02% (14.63 / 91.36 = 16.02%). Net margin (income statement basis) moved to 5.44% (4.97 / 91.36 = 5.44%), up from 2.65% a year earlier. Those margin moves show that the company generated more profit per dollar of revenue in FY2024 even though the top line grew modestly.

A critical technical point: the effective tax rate implied by the dataset varied materially year to year and materially affected reported net income. Using income‑statement numbers, the FY2024 effective tax rate = (incomeBeforeTax 7.57 - netIncome 4.97) / 7.57 = 34.36%. By contrast, FY2023 shows an implied rate near 50.73%; FY2022 about 40.45%; FY2021 about 21.88%. Those swings in effective tax rate are large enough that a portion of the FY2024 net‑income improvement reflects a lower effective tax burden versus FY2023, in addition to operating leverage.

Taken together, the income statement trend is unambiguous: steady revenue expansion, double‑digit operational margin improvement and an outsized gain in reported net income driven by both operating performance and a lower effective tax rate.

Cash flow quality#

Cash generation improved sharply in FY2024. Net cash provided by operating activities rose to $13.97B (from $9.87B in FY2023), an increase of (13.97 - 9.87) / 9.87 = +41.53%. Free cash flow (FCF) increased to $8.56B (from $4.90B), a change of (8.56 - 4.90) / 4.90 = +74.69%. The company’s free cash flow margin — FCF divided by revenue — moved to 9.37% (8.56 / 91.36 = 9.37%) in FY2024 from 5.51% the prior year.

There is a dataset inconsistency that affects cash‑conversion calculations and must be called out. The income statement reports FY2024 net income as $4.97B, whereas the cash‑flow statement lists a FY2024 starting net income of $5.77B. When calculating cash‑conversion metrics you can either pair operating cash flow with the income‑statement net income or with the cash‑flow statement’s net income (which is typically the starting point of the cash‑flow reconciliation). Both computations are material and both are calculated below: using income‑statement net income, operating cash flow conversion = 13.97 / 4.97 = 281.19%; using the cash‑flow statement net income, operating cash flow conversion = 13.97 / 5.77 = 242.18%. Free cash flow conversion similarly is 8.56 / 4.97 = 172.23% (income‑statement basis) or 8.56 / 5.77 = 148.44% (cash‑flow statement basis). The presence of divergent net‑income figures in the dataset is material to interpretation and should be reconciled in the underlying filings; for transparency this analysis shows both calculations.

Capital spending remained steady as a share of revenue: capital expenditure in FY2024 was $5.41B, or 5.92% of revenue (5.41 / 91.36 = 5.92%). That magnitude of reinvestment, combined with a step‑up in FCF, means the firm generated excess cash that management used for shareholder distributions and other financing activity: FY2024 dividends paid were $1.37B and share repurchases were $2.99B. Together, cash returned to shareholders in FY2024 totaled $4.36B, which represents 50.93% of FCF (4.36 / 8.56 = 50.93%) and 87.73% of FY2024 income on an income‑statement basis (4.36 / 4.97 = 87.73%).

The quality of cash flow is high in the sense that operating cash flow and FCF have both accelerated; the caution is the large drawdown in the cash balance (cash at period end fell by $8.13B, from $14.23B to $6.10B). The decline in cash funded part of the resumed capital returns and likely other financing uses. The dataset shows a net cash used for financing activities of -$15.29B in FY2024; only -$4.36B of that is itemized in the dataset as dividends and repurchases, leaving a sizable residual financing outflow that is not itemized in the summary lines here (see the Balance Sheet section for the balance‑sheet view of that reconciliation). This divergence is visible in the raw numbers and should be reconciled in the company's detailed cash‑flow notes.

Balance sheet and leverage#

Balance sheet composition shifted in FY2024. Total assets fell to $196.22B from $205.58B, a decline of (196.22 - 205.58) / 205.58 = -4.55%. The reduction in cash and in goodwill and intangible assets were the largest discrete year‑over‑year moves: cash and equivalents fell from $14.18B to $6.00B (dataset balance‑sheet figure), and goodwill & intangible assets fell from $90.13B to $84.06B (-$6.07B, or -6.73%).

On the liability side, total debt (reporting totalDebt) ticked down slightly to $49.52B from $50.67B (a change of -2.27%), while net debt (totalDebt minus cash & short‑term investments) increased materially because the cash balance declined. Net debt moved from $36.49B in FY2023 to $43.52B in FY2024, an increase of +19.27% (43.52 - 36.49 = 7.03 / 36.49 = +19.27%). That rise in net debt is important even though gross debt fell slightly because it means the company's leverage on a net basis increased.

Two useful leverage metrics, computed directly from the dataset, are net debt to EBITDA and debt to equity. Net debt / EBITDA = 43.52 / 14.63 = 2.98x. Total debt / equity = 49.52 / 100.70 = 0.49x (i.e., total debt equals about 0.49x shareholders’ equity). Using the market capitalization in the dataset (marketCap = $209.12B), an enterprise value approximation EV = marketCap + totalDebt - cash = 209.12 + 49.52 - 6.00 = $252.64B, which implies EV / FY2024 EBITDA = 252.64 / 14.63 = 17.27x. Note that EV/EBITDA and other market multiples will differ from the dataset’s TTM multiples because this analysis is using fiscal‑year numbers and the snapshot market capitalization provided; timing differences account for the gap.

The short‑term liquidity picture worsened in FY2024. The current ratio declined to 0.73x (totalCurrentAssets 25.24 / totalCurrentLiabilities 34.60 = 0.73x) from 1.05x a year earlier; working capital moved from roughly +$1.62B in FY2023 to -$9.36B in FY2024. A current ratio below 1 and negative working capital are not intrinsically fatal for a large, cash‑generative company, but they do signal increased reliance on long‑dated cash generation and on access to capital markets to meet short‑term obligations if unexpected cash demands arise.

Key ratio calculations (Monexa AI computations)#

This section lists the primary ratios calculated directly from the dataset. Formulas are shown, and each value is computed from the FY2024 numbers in the provided financials.

Operating and profitability ratios: gross margin = grossProfit / revenue = 32.66 / 91.36 = 35.75%. Operating margin = operatingIncome / revenue = 11.91 / 91.36 = 13.04%. Net margin (income‑statement basis) = netIncome / revenue = 4.97 / 91.36 = 5.44%. EBITDA margin = EBITDA / revenue = 14.63 / 91.36 = 16.02%.

Cash‑flow and capital intensity ratios: free cash flow margin = FCF / revenue = 8.56 / 91.36 = 9.37%. CapEx / revenue = 5.41 / 91.36 = 5.92%. Operating cash flow conversion (CFO / income‑statement net income) = 13.97 / 4.97 = 281.19%; using the cash‑flow statement's reported net income as the reconciliation starting point (5.77) yields 242.18%. Free cash flow conversion (FCF / income‑statement net income) = 8.56 / 4.97 = 172.23% (or 148.44% using the cash‑flow statement net income of 5.77).

Leverage and market multiples: net debt / EBITDA = 43.52 / 14.63 = 2.98x. Total debt / equity = 49.52 / 100.70 = 0.49x. EV / EBITDA (approximate) = (marketCap + totalDebt - cash) / EBITDA = (209.12 + 49.52 - 6.00) / 14.63 = 17.27x. Price / Sales (marketCap / revenue) = 209.12 / 91.36 = 2.29x. Price / Book (marketCap / shareholders' equity) = 209.12 / 100.70 = 2.08x. Price / Earnings (market price 116.31 / EPS 6.38 = 18.23x) is internally consistent with the stock quote in the dataset.

Return measures (approximate, FY2024): return on equity (ROE) using average equity = netIncome / average equity = 4.97 / ((100.70 + 99.28) / 2) = 4.97 / 99.99 = 4.97% (note: this differs from the dataset's TTM ROE figure because the dataset uses trailing‑twelve‑month measures and different timing). A simple NOPAT‑based ROIC using NOPAT = operatingIncome * (1 - effective tax rate) with the FY2024 tax rate of 34.36% gives NOPAT ≈ 11.91 * (1 - 0.3436) = $7.82B. Defining invested capital = total debt + total equity - cash = 49.52 + 100.70 - 6.00 = $144.22B, ROIC ≈ 7.82 / 144.22 = 5.42% (approximate and sensitive to definitions of invested capital and the tax base used).

What the numbers reveal (not the narrative)#

First, the company’s profitability improved materially in FY2024: operating margin expanded from 10.11% to 13.04%, and EBITDA margin rose to 16.02%. That operating leverage is the core driver of the net‑income increase, not top‑line acceleration. Revenue growth of +2.77% is modest; it is improved margins and a more favourable effective tax environment that produced the large net‑income gain.

Second, cash generation strengthened meaningfully. Operating cash flow and FCF both accelerated, and FCF margin moved into high single digits (9.37%). Management used that cash to resume shareholder returns and to trim gross debt modestly. However, the balance‑sheet cash drawdown was large: cash fell by $8.13B in FY2024 and net debt rose by $7.03B. The result is a dichotomy — substantially stronger recurring cash generation, paired with a lower cash cushion and higher net indebtedness.

Third, liquidity and working‑capital dynamics are a clear watch item. The current ratio moved from 1.05x to 0.73x and working capital swung into a -$9.36B deficit. That shift increases short‑term reliance on operating cash flow and market access. The dataset also contains a sizable, unexplained financing outflow (net financing uses of -$15.29B where dividends plus buybacks account for -$4.36B), implying other financing uses not detailed in the top‑line cash items in the summary tables. That gap merits attention in the full cash‑flow note.

Finally, leverage on a normalized profitability basis remains moderate. Net debt / EBITDA of 2.98x and total debt / equity of 0.49x are within common ranges for diversified media & entertainment firms; enterprise multiples (EV/EBITDA ≈ 17.27x) reflect a valuation that is not cheap on FY2024 earnings. Those leverage ratios improved slightly on an EBITDA basis (because EBITDA rose) even as net debt increased, demonstrating the importance of earnings momentum to leverage math.

What this means for investors#

The dataset implies a company that is converting modest revenue growth into meaningful profit and cash‑flow improvement. The priority signals from the numbers are twofold: the business is demonstrating operational leverage (margins and EBITDA up), and it is generating materially more free cash flow that management is now allocating to dividends and buybacks. From a purely numbers perspective, that is a positive re‑orientation of cash deployment relative to recent years when returns were paused.

At the same time, there are tangible balance‑sheet and liquidity caveats that investors should monitor. Cash reserves fell to $6.10B at year end, the current ratio is 0.73x, and net debt rose to $43.52B — all of which elevate the importance of continuing high cash conversion and access to capital markets. The unexplained residuals in financing cash flows and the divergence between income‑statement net income and cash‑flow statement net income in the dataset also increase the need for line‑item reconciliation in the company disclosures.

Practical watch items driven strictly by the numbers: follow operating cash flow to ensure the recent improvement is sustainable (not a one‑off working‑capital release), watch free cash flow margin and its capacity to fund dividends and buybacks without draining liquidity, and track net debt / EBITDA and current ratio quarterly for signs of stress or re‑acceleration of deleveraging. On valuation, FY2024 EV/EBITDA of ~17.3x and P/S of ~2.29x reflect a market pricing that assumes continued earnings improvement; actual outcomes will depend on sustaining current margins and cash conversion.

Conclusion#

Disney’s FY2024 financials present a clear, number‑driven portrait: revenue of $91.36B (+2.77%), stronger margins (operating margin 13.04%, EBITDA margin 16.02%), and significantly improved free cash flow ($8.56B, FCF margin 9.37%). Those improvements drove a large year‑over‑year rise in reported net income on the income statement (+111.49%). At the same time, the company ended the year with $6.10B in cash, a 0.73x current ratio and $43.52B of net debt — a combination that tightens near‑term liquidity cushions despite stronger cash generation.

All ratios and percentages in this report are calculated directly from the dataset entries for the company’s fiscal years (income statement, balance sheet and cash‑flow statements). Where the dataset contains conflicting line items (notably net income reported on the income statement vs. the cash‑flow statement for the same fiscal period) this analysis shows both computations and flags the inconsistency for reconciliation in the official filings.

In short, the raw numbers show operational improvement and stronger cash conversion, balanced against a materially reduced cash buffer and a negative working capital position at fiscal year‑end. Those are the measurable trade‑offs implied by the FY2024 statements in the dataset — strengths in profitability and cash generation, accompanied by an increase in short‑term liquidity risk that deserves continued monitoring.

(Source: company financials included in the provided dataset — income statement, balance sheet and cash‑flow tables for FY2021–FY2024.)