Current:Home > ContactFour takeaways from Disney's earnings call -WealthMap Solutions
Four takeaways from Disney's earnings call
View
Date:2025-04-16 08:34:16
Disney owns so many global brands, in-person experiences, characters and storylines that when one asset falters, another offsets the loss. The company beat analysts' expectations, with revenues for the quarter and the year growing 5% and 7%, respectively.
Here are four takeaways from Wednesday's earnings call:
1. Streaming: Disney+ is still not profitable but losing a lot less. This time last year, the streaming service lost nearly $1.5 billion. This past quarter, it lost just $387 million. "Who would have thought in any sort of business we would be celebrating a loss of just $387 million," jokes Brandon Katz, an entertainment industry strategist for Parrot Analytics.
Katz points out that streaming is costly and that only Netflix is "consistently profitable." He says Disney is "making steady progress," especially now that it controls Hulu. With plans for a single app that will offer both Disney+ and Hulu content, Katz believes it'll attract a much broader audience and create a "more seamless entertainment experience for consumers because we audiences, we are lazy and I mean that in the best way possible. I'm a proud couch potato and what we want is not to be spending so much time seeking out content."
Disney+ added 7 million subscribers this quarter. Iger said he believes the company's streaming business will be profitable in the latter part of 2024.
2. Theme parks/resorts/cruises: Disney's Experiences is a major profit driver. The division saw a 13% increase in revenue to $8.16 billion, with growth at almost all of its international and domestic sites. Disney recently announced it would invest $60 billion to, as Iger put it, "turbocharge" its parks, resorts, cruises and the like.
The only site that has not done well is Walt Disney World in Florida. The company said declines there were due to the end of its 50th anniversary celebrations, the closing of Star Wars: Galactic Starcruiser, and wage inflation.
After several months of negotiations, Disney agreed to raise union workers' pay to $18 per hour by the end of 2023, with additional increases over the next three years. "Those employees have earned the right to be paid more," says Rick Munarriz, senior media analyst at The Motley Fool. "It's not easy dealing with tourists... But of course, it does mean that... profits do take a hit in the process."
3. ESPN: Disney is all in to take ESPN direct-to-consumer. The company says the sports network's revenue has grown year over year. During the earnings call, Iger said ESPN is the number 1 brand on TikTok "with about 44 million followers." He said they're hoping to find partners, including sports leagues, that would help them with technology, marketing and content with the goal of turning ESPN into a "preeminent digital sports platform."
4. Striving for growth while cutting costs: While touting ambitions for ESPN and its theme parks, Disney said it plans to "aggressively manage" costs, increasing its "efficiency target" by $2 billion.
"Disney has been attempting to walk this financial tightrope like an expert circus performer over the last 12 months or so," says Katz, "And what they're trying to do is...invest in their products, in programming... streaming expansion... But they're trying to do that while also managing the debt."
Disney has its eyes on the future, says Munarriz. "Because of the strength of the theme parks and then the success of Disney+ and its other streaming services, it's able to get to the point where for next year it will be back to pre-pandemic levels, which is very interesting because this is a stock that hit a nine-year low just a couple of weeks ago... But Disney seems pretty confident that it's going to be, you know, at peak form within the new year."
As Iger put it, Disney is moving "from a period of fixing to a period of building."
veryGood! (616)
Related
- Man can't find second winning lottery ticket, sues over $394 million jackpot, lawsuit says
- Is a Spirit Christmas store opening near you? Spirit Halloween to debut 10 locations
- Opinion: Harris' 'Call Her Daddy' podcast interview was a smart way to excite her base
- Do you really want an AI gadget?
- Travis Hunter, the 2
- Riley Keough felt a duty to finish Lisa Marie Presley’s book on Elvis, grief, addiction and love
- In Florida Senate Race, Two Candidates With Vastly Different Views on the Climate
- Horoscopes Today, October 8, 2024
- Jamie Foxx reps say actor was hit in face by a glass at birthday dinner, needed stitches
- Not Sure How To Clean a Dishwasher or Washing Machine? These Pods are on Sale for $15 & Last a Whole Year
Ranking
- Who are the most valuable sports franchises? Forbes releases new list of top 50 teams
- Louisiana’s Cajun and Creole heritage will be showcased at 50th annual Festivals Acadiens et Creoles
- Lizzo Shares Insight Into Months-Long Progress Amid Weight Loss Journey
- 5 must-know tips for getting a text, call through after a big storm: video tutorial
- Google unveils a quantum chip. Could it help unlock the universe's deepest secrets?
- 4 people, dog rescued after small plane crashes into Gulf in Hurricane Milton evacuation
- 'Out of harm's way': Dozens of Florida Waffle Houses close ahead of Hurricane Milton
- EBUEY: Bitcoin Leading a New Era of Digital Assets
Recommendation
Charges tied to China weigh on GM in Q4, but profit and revenue top expectations
Turkish Airlines flight makes emergency landing in New York after pilot dies
Washington state woman calls 911 after being hounded by up to 100 raccoons
State police recruit’s death in Massachusetts overshadows graduation ceremony
Sarah J. Maas books explained: How to read 'ACOTAR,' 'Throne of Glass' in order.
These Are the Best October Prime Day 2024 Essentials That Influencers (And TikTok) Can’t Live Without
Not Sure How To Clean a Dishwasher or Washing Machine? These Pods are on Sale for $15 & Last a Whole Year
Montana’s attorney general faces a hearing on 41 counts of professional misconduct