Disney misses Q3 2019 earnings because of the Fox movies it inherited

Thursday, 08 Aug, 2019

Hulu, ESPN+, and Disney+ will all be available as part of one subscription when the Disney+ service launches on November 12, Disney CEO Bob Iger told investors during the company's quarterly earnings call Tuesday.

Disney Plus, which is Disney's new streaming service, will offer new exclusive shows and movies, along with the vast library that includes all Marvel, Pixar, and Star Wars projects, as well.

Considering all the money Disney is making with their other movies though - like Endgame now being the highest-grossing movie of all time - I do find it weird to blame that movie alone and the loss is likely the company still just absorbing that massive amount into their accounting.

Disney also unexpectedly let go Elizabeth Gabler, head of its mid-budget Fox 2000 unit, at the 11th hour.

Revenue rose 33% to 20.2 billion dollars (£16.6 billion), short of the 21.4 billion dollars (£17.59 billion) analysts expected. The bundle will be available in November when Disney+ is slated to launch, and it will cost $13 a month.

Disney's third-quarter results missed Wall Street's forecasts despite the media giant's movie studio breaking several box office records this year.

The continued losses are due to the consolidation of Hulu, investment in ESPN+, and the upcoming launch of Disney+.

Media Networks revenues for the quarter increased 21% to $6.7 billion and segment operating income increased 7% to $2.1 billion. And Iger said visitor numbers to that attraction were stunted by cost increases at the Park and at nearby hotels, as well as by visitors' expectations of crowding.

While Disney has not seen any impact on its Shanghai Disney Resort in China with the ongoing protests in Hong Kong or the US-China trade war, Iger said the Disneyland in Hong Kong has not been spared. Shows aimed at adults will be concentrated on Hulu, which Disney now controls.

You'd think that the series would have been put into the annals of movie history and hopefully never touched again.

Christine McCarthy, the chief financial officer at Disney, said looking ahead to the fourth quarter of 2019, the company expects lower programming expenses for its broadcasting division.

"Disney has powerful content", he said in an interview with Bloomberg Television.

Still, he said it would take "a good solid year, maybe two years, before we can have an impact" on Fox's film business. Disney incurred restructuring charges of $207 million related to the Fox acquisition following the first full quarter of ownership.