Walt Disney missed Wall Street revenue targets and fell slightly below expectations for Disney+ subscribers in the United States. However, it beat Wall Street estimates for adjusted earnings per share and said it was on track to cut costs by more than the $5.5 billion it promised investors in February.
The service added 800,000 subscribers to Disney+, 100,000 fewer subscribers than analyst estimates, and lost 12.5 million subscribers to the Disney Hotstar service in Indiaor nearly a quarter of the total, as it relinquished the rights to Indian Premiere League cricket matches.
On the other hand, Disney reported revenue of $22.33 billion in the quarter ended July 1, 4% more than a year ago.but less than Wall Street’s median estimate of $22.5 billion, according to Refinitiv data.
Chief Executive Bob Iger, who has returned for a second stint at the helm of Disney, faces formidable challenges on nearly every front in the entertainment empire, beyond Wall Street’s demands to make his streaming business profitable.
Iger is grappling with an eroding television business and a movie box office that has yet to recover to pre-crisis levels. In a statement Wednesday, Iger said Disney is undergoing an “unprecedented transformation,” including a restructuring of the company, to help it become more efficient and restore creativity.
“In the eight months since my return, these significant changes are creating a more profitable, coordinated and streamlined approach to our operations, which has put us on track to exceed our initial goal of $5.5 billion in savings,” he said. .
Disney said it cut losses on its video streaming services to $512 million in its fiscal third quarter, down from about $1.1 billion a year ago.
Earnings per share were $1.03 excluding some items, beating Wall Street forecasts of 95 cents per sharealthough it was not immediately clear if the adjusted earnings figures were calculated on a comparable basis.
The company was faced with $2.65 billion in charges for lower asset value and restructuring in the quarterreflecting the cost of removing some content from its streaming services, terminating license agreements and $210 million in severance payments to laid off workers.
Source: Ambito
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