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A light show will be held at Enchanted Storybook Castle at Shanghai Disney Resort to celebrate Halloween in Shanghai, China on October 31, 2023.
Los Angeles
CNN
—
The Walt Disney Company on Wednesday reported lower-than-expected earnings for the past quarter, disappointing Wall Street expectations.
“This quarter’s results reflect the significant progress we have made over the past year,” CEO Bob Iger said in a statement. “While we still have work to do, these efforts have enabled us to get through this period of correction and start building our business again.”
disney stock The stock rose 4% in after-hours trading, rebounding from a nearly 10-year low.
Analysts surveyed by Refinitiv expected the company’s revenue to be $21.2 billion, slightly below expectations of $21.3 billion.
Disney report arrives Turbulent times for the company The company is grappling with a cash-strapped streaming business, cord-cutting, a recent string of box office failures, an ongoing actors’ strike and a legal battle with Florida Gov. Ron DeSantis, a Republican presidential candidate.
The company said it is “actively managing its cost base” and plans to save $2 billion more than previously reported. Disney previously announced 7,000 job cuts in February as part of a $5.5 billion cost-cutting plan. The company announced Wednesday that its efficiency goal has expanded to $7.5 billion. No layoffs have been announced, but the expansion of cost cuts could hint at future layoffs.
Disney’s theme parks division has been a bright spot for the company, increasing more than 30% year over year. The company pointed to the strengths of its international theme parks and Disney cruises. But the company said revenue at Walt Disney World in central Florida was weak.
The company’s fiscal fourth quarter, which began in July and ended in October, included the summer downturn seen at the Walt Disney World Resort in Central Florida. In July, Disney World park goers experienced shorter-than-expected wait times for rides and fewer crowds than expected.
Disney’s flagship streaming service, Disney+, saw a 1% increase in its subscriber base in the U.S. and Canada during the quarter, and an 11% increase in subscribers internationally.
Ad-supported Disney+ added more than 2 million subscriptions in the fourth quarter, Iger said.
Disney’s streaming business reported a loss of $420 million in the quarter.
Disney has totaled more than $10 billion in losses from its streaming services business since introducing it in 2019.
Iger reiterated during Disney’s earnings conference that he is “confident” that the company’s streaming service will reach profitability by the end of 2024.
“We are bullish about the future of the streaming business,” Iger said.
In October, Disney raised the price of an ad-free Disney+ subscription to $13.99 per month, but kept the price of ad inventory at $7.99 per month.
This is a developing story and will be updated.