On Wednesday, Bob Iger, the CEO of Walt Disney, recognised that the entertainment firm confronts a "challenging environment" in the near future, but he also emphasised progress in cost-cutting and a focus on creativity, even as quarterly results revealed Disney's weak points.
In after-hours trading, Disney's stock increased by about 3% as Iger highlighted a $1 billion increase in operational income at the company's streaming division over the past three quarters, which aims to become profitable in 2024.
However, he also recognised the need to raise the calibre of Disney's motion pictures, position the company's leading sports brand, ESPN, for direct consumer streaming, and find a solution to the Hollywood writers' and actors' strikes that have delayed a lot of film and television production.
“I returned to Disney in November, and I've agreed to stay on longer, because there was more to accomplish before our transformation is complete,” Iger said, describing a "challenging environment in the near term.”
The business announced it was on track to cut expenses by more than the $5.5 billion it promised investors in February and said it had surpassed Wall Street's earnings estimates for the third quarter of its fiscal year.
Additionally, Disney reported quarterly revenue that fell short of analyst predictions for Disney+ subscribers in the United States.
The media conglomerate announced that the ad-free tier of the Disney+ service will increase in price by 27% to $13.99 and that the no-ad version of Hulu will increase in price by 20%.
Disney also disclosed it would introduce ad-supported streaming in Europe and Canada and offer U.S. subscribers a new, ad-free bundle in the coming months in an effort to draw and keep members in a crowded streaming market.
In line with Netflix, Iger stated that he will address the issue of password sharing in the upcoming year.
He claimed that Disney would cut back on both the quantity of films it releases and the price per film.
Disney reported that it reduced losses at its streaming video services from roughly $1.1 billion a year ago to $512 million in the third quarter of its fiscal year.
It increased 800,000 Disney+ users, falling short of analyst predictions by 100,000 subscribers, and lost 12.5 million customers to the Disney Hotstar service in India as a result of giving up the rights to broadcast cricket matches from the Indian Premier League.
"Disney will have to cut prices from current levels in an effort to stimulate demand and defend its market share in an increasingly competitive industry," said Jesse Cohen, senior analyst at Investing.com.
Refinitiv reports that Disney's revenue for the three months that ended on July 1 increased by 4% to $22.33 billion from the same period last year, slightly missing Wall Street expectations. When certain factors are taken out, it produced per-share earnings of $1.03, exceeding Wall Street expectations of 95 cents.
The cost of withdrawing some content from its streaming services, ending licencing agreements, and paying $210 million in severance to employees who were laid off was reflected in the company's $2.65 billion in impairment and restructuring charges for the quarter.
Disney's conventional television business kept losing money. Lower affiliate revenue and higher production costs for sports programming hurt its cable networks' earnings. Operating income dropped 23% to $1.9 billion, while TV revenue dropped 7% to $6.7 billion.
Disney's direct-to-consumer division saw a 9% rise in sales to $5.5 billion as Disney+ and Hulu's average revenue per subscriber increased.
As a result of certain underwhelming films, like the live-action remake of "The Little Mermaid," content sales and licencing, the division that comprises film and television sales, reported a deeper operational loss of $243 million in the quarter compared to a loss of $27 million a year earlier.
The Parks, Experiences, and Products division of Disney reported a 13% rise in sales to $8.3 billion for the quarter and an 11% increase in operating income to $2.4 billion. The Shanghai Disney Resort's improvement, which saw it open for the entire quarter as opposed to the same period last year when COVID-19 forced the park to close for all but three days, gave the figures a boost. Due to declines in the Walt Disney World Resort in Orlando, Florida, the unit's operating revenue at its domestic parks was lower.
(Source:www.theprint.in)
In after-hours trading, Disney's stock increased by about 3% as Iger highlighted a $1 billion increase in operational income at the company's streaming division over the past three quarters, which aims to become profitable in 2024.
However, he also recognised the need to raise the calibre of Disney's motion pictures, position the company's leading sports brand, ESPN, for direct consumer streaming, and find a solution to the Hollywood writers' and actors' strikes that have delayed a lot of film and television production.
“I returned to Disney in November, and I've agreed to stay on longer, because there was more to accomplish before our transformation is complete,” Iger said, describing a "challenging environment in the near term.”
The business announced it was on track to cut expenses by more than the $5.5 billion it promised investors in February and said it had surpassed Wall Street's earnings estimates for the third quarter of its fiscal year.
Additionally, Disney reported quarterly revenue that fell short of analyst predictions for Disney+ subscribers in the United States.
The media conglomerate announced that the ad-free tier of the Disney+ service will increase in price by 27% to $13.99 and that the no-ad version of Hulu will increase in price by 20%.
Disney also disclosed it would introduce ad-supported streaming in Europe and Canada and offer U.S. subscribers a new, ad-free bundle in the coming months in an effort to draw and keep members in a crowded streaming market.
In line with Netflix, Iger stated that he will address the issue of password sharing in the upcoming year.
He claimed that Disney would cut back on both the quantity of films it releases and the price per film.
Disney reported that it reduced losses at its streaming video services from roughly $1.1 billion a year ago to $512 million in the third quarter of its fiscal year.
It increased 800,000 Disney+ users, falling short of analyst predictions by 100,000 subscribers, and lost 12.5 million customers to the Disney Hotstar service in India as a result of giving up the rights to broadcast cricket matches from the Indian Premier League.
"Disney will have to cut prices from current levels in an effort to stimulate demand and defend its market share in an increasingly competitive industry," said Jesse Cohen, senior analyst at Investing.com.
Refinitiv reports that Disney's revenue for the three months that ended on July 1 increased by 4% to $22.33 billion from the same period last year, slightly missing Wall Street expectations. When certain factors are taken out, it produced per-share earnings of $1.03, exceeding Wall Street expectations of 95 cents.
The cost of withdrawing some content from its streaming services, ending licencing agreements, and paying $210 million in severance to employees who were laid off was reflected in the company's $2.65 billion in impairment and restructuring charges for the quarter.
Disney's conventional television business kept losing money. Lower affiliate revenue and higher production costs for sports programming hurt its cable networks' earnings. Operating income dropped 23% to $1.9 billion, while TV revenue dropped 7% to $6.7 billion.
Disney's direct-to-consumer division saw a 9% rise in sales to $5.5 billion as Disney+ and Hulu's average revenue per subscriber increased.
As a result of certain underwhelming films, like the live-action remake of "The Little Mermaid," content sales and licencing, the division that comprises film and television sales, reported a deeper operational loss of $243 million in the quarter compared to a loss of $27 million a year earlier.
The Parks, Experiences, and Products division of Disney reported a 13% rise in sales to $8.3 billion for the quarter and an 11% increase in operating income to $2.4 billion. The Shanghai Disney Resort's improvement, which saw it open for the entire quarter as opposed to the same period last year when COVID-19 forced the park to close for all but three days, gave the figures a boost. Due to declines in the Walt Disney World Resort in Orlando, Florida, the unit's operating revenue at its domestic parks was lower.
(Source:www.theprint.in)
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