In a recent earnings release, Disney disappointed investors with another bad quarter. There are several reasons cited for the disappointing sales and profits. One of the biggest acquisitions for Disney in years was ESPN. However, Disney bought the company right as it was starting to decline.
Many people believe that ESPN is declining because of the political coverage in sports. Instead of just covering sports games, ESPN has decided to add in political commentary. Many viewers want to watch sports in order to get away from sports. This has resulted in viewers watching sports coverage on other channels.
Areas for Improvement
Disney is working hard to fix the problems at ESPN. Until that goal is complete, the company is working on a variety of other programs as well. One of the biggest announcements from the recent earnings release is a Disney streaming channel. This channel will offer premium movies and shows that viewers can only get through this service.
Streaming is the new way for people to watch television. Disney recognizes that this is a way to increase income and build up their customer base in the future. The CEO of Disney, Bob Iger, said that he is confident this streaming service will help grow market share for the company again.
The Digital Problem
One of the biggest problems for Disney is that people do not spend as much time watching television as they did in years past. This is a major issue for Disney. Not only does it limit the advertising revenue that comes into the company, but Disney is losing market share to other media companies.
If Disney is going to remain competitive in the market, they have to make drastic changes to their business. If Disney can fix the ESPN problem that it has, this will go a long way in improving sales and profits.
The latest quarterly earnings release was not a good one for Disney. Over the past few years, investors have been disappointed time after time with this company. There are some people who think that the company will never return to what it once was.