Media networks reported a dip in revenue and profit
Matt Pressberg | February 7, 2017 @ 1:09 PM
Last Updated: February 7, 2017 @ 2:42 PM
waltdisney earnings
The Walt Disney Company began its fiscal year with a whimper, as the entertainment giant was unable to successfully fend off headwinds facing its cable business, reporting revenue that fell short of expectations.
After the close of markets Tuesday, Disney reported revenue of $14.8 billion and earnings of $1.55 a share for the three months ended Dec. 31, which the company classifies as the first quarter of its fiscal year. The Mouse House reeled in $15.2 billion in revenue and earnings of $1.63 a share for the corresponding period a year earlier, which included one of the biggest movies ever, “Star Wars: The Force Awakens.”
Analysts had estimated $15.3 billion in revenue and earnings of $1.50 a share on average for the most recent quarter.
“We’re very pleased with our financial performance in the first quarter,” Disney Chairman and CEO Bob Iger said in a statement accompanying the earnings. “Our Parks and Resorts delivered excellent results and, coming off a record year, our Studio had three global hits including our first billion-dollar film of fiscal 2017, ‘Rogue One: A Star Wars Story.’ With our proven strategy and unparalleled collection of brands and franchises, we are extremely confident in our ability to continue to drive significant value over the long term.”
Cable networks, particularly ESPN, have been an albatross on Disney’s stock price even as the company’s two other major prongs, movies and theme parks, continue to perform well. As cheaper TV alternatives began to proliferate, ESPN hemorrhaged subscribers during the course of 2016 and is now at less than 88 million, compared with a peak of 100.1 million in 2011. At an estimated $7 per subscriber, that dip has been a substantial hit to Disney, especially considering media networks made up 49 percent of Disney’s profits during fiscal 2016.
At the same time, rights fees for the live sports ESPN specializes in broadcasting continue to go up, as there’s plenty of competition for one of the few pieces of programmed television that still delivers monster ratings. ESPN will pay $7.3 billion for content this year – the biggest price tag among all media companies. Operating income at Disney’s cable networks division — primarily ESPN — plunged 11 percent compared with the same time the previous year. Disney attributed that drop entirely to lower ESPN revenue.
The timing of this year’s college football playoff games — always among ESPN’s highest-rated broadcasts — also wasn’t favorable. Three of the games occurred during the company’s fiscal first quarter compared with six last year, accounting for part of the drop. However, Disney also identified declining subscribers as a contributing factor in its earnings report.
On the other hand, Disney’s film division had a record 2016, becoming the only studio in history to gross more than $7 billion in a single year at the international box office and $3 billion domestically. Disney also had four of the five highest-grossing films at the domestic box office last year. After a mid-year lull, which was reflected in its last earnings report, Disney regrouped for the holiday season behind “Rogue One: A Star Wars Story,” which has already blasted its way past $1 billion worldwide — but the studio couldn’t match its banner haul from last holiday season.
Parks and resorts was the Mouse House’s best-performing division, and the only to report year-over-year gains in revenue and profit. Behind new attractions at home and the opening of Shanghai Disneyland Park in June, the division reported a 6 percent increase in revenue and a 13 percent jump in profit.
17 Live-Action Disney Movies in the Works (Photos)
Disney will be pumping out live-action versions of its animated classics for a long time to come. Here's a list of titles in the works, including the release date of the original.
"Cruella" Extracted from the famous villainess of 1961’s “One Hundred and One Dalmatians,” this origin story of a woman who declares open season on purebred puppies -- Cruella de Vil -- stars Emma Stone. The reigning live-action Cruella is Glenn Close, who herself starred in two live-action adaptations. It's due in theaters May 28, 2021.
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"Jungle Cruise"
OK, OK, "Jungle Cruise" might not count as live-action film based on a previously animated classic, but it is based on a ride at Disneyland, so we're going to include it. Plus, we'll take any chance to talk about Dwayne Johnson and Emily Blunt in the same sentence. It will hit theaters July 30, 2021.
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"The Little Mermaid" So now we're getting into films that are in some stage of development but haven't necessarily been slated for release. After all, Disney has so many untitled films slated, it's hard to count. But a live-action version of "The Little Mermaid" has been long discussed, as it is arguably one of the most popular and profitable movies in Disney's vault. Rob Marshall is on board direct, with newcomer Halle Bailey set to star as Ariel and Melissa McCarthy as Ursula and Daveed Diggs as the voice of Sebastian the crab.
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"Pinocchio"
"Pinocchio" is also in the works, with Tom Hanks playing Geppetto.
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"The Jungle Book 2" This is a no-brainer follow-up to Favreau's hit from spring 2016, based on the animated classic released in 1967.
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"Rose Red" This one is trippy (no pun over producer Tripp Vinson), but promising creatively. In the German fairy tale, Rose Red is Snow White's sister. Disney and Vinson are collaborating on introducing the world to the sibling of the famous apple-loving princess. Disney released the original "Snow White" in 1937.
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"Snow White" Forget her sister -- the original baddest chick in the Disney animated kingdom is coming back for her own standalone film. It was announced at the end of October 2016.
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"Aladdin 2"
After the $1 billion-plus box office success of 2019's Will Smith-led "Aladdin," the studio announced in February 2020 that John Gatins and Andrea Berloff would write a sequel.
"Hercules"
Talk about going from zero to hero. The original 1997 retelling of Greek myths was a box office underachiever, but developed a big enough cult following that the studio announced plans for a live-action remake in April 2020, with "Avengers: Endgame" directors Joe and Anthony Russo producing.
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"Peter Pan" Neverland will get a practical set if Disney has its way updating the 1953 animated film.
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"James and the Giant Peach" In one of the more interesting adaptations, this beloved Roald Dahl book became a quirky claymation hit for Disney in 1996 with director Henry Selick. Heavy dramatist director Sam Mendes was attached to take a stab at it, but he has since dropped out.
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"Hunchback"
In early 2019, a live-action film based on 1996's "The Hunchback of Notre Dame" was announced. Tony-winning playwright David Henry Hwang was tapped to pen the script, with Alan Menken and Stephen Schwartz handling the music.
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"Tinker Bell"
This movie has also been in the works for quite some time, with Reese Witherspoon attached as the cute little fairy from "Peter Pan."
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"Bambi"
In January 2020, Disney hired Geneva Robertson-Dworet (“Captain Marvel") and Lindsey Beer (“Sierra Burgess Is a Loser,”) to write the script for the live-action remake of the 1942 animated classic.
"Oliver Twist" While Disney never formally made a direct animated take on Charles Dickens' beloved orphan, the studio did release the adorable 1988 "Oliver and Company," inspired by Dickens' tale but told with animals. The studio also made a small-screen live-action version in 1997 with Richard Dreyfuss.
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"Lilo & Stitch"
And another film that is supposed to get the live-action treatment and some point. This project was announced in October 2018 with Mike Van Waes attached to pen the script. Dan Lin and Jonathan Eirich of Rideback are producing. In November, it was announced that Jon M. Chu was in early talks to direct.
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"The Lion King" Sequel
In September, it was announced that Barry Jenkins would direct the follow-up to Jon Favreau's 2019 hit. The logline is being kept under wraps, but Deadline reported that the film will explore the mythology of the other characters throughout Pride Rock, including Mufasa’s origin story.
No release date for the next film has been set, and it’s unclear when production would begin. No cast has been set either.
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The studio is raiding its vault to remake classics including “The Little Mermaid”
Disney will be pumping out live-action versions of its animated classics for a long time to come. Here's a list of titles in the works, including the release date of the original.