Disney Reports Loss of $4.7 Billion for Q3 as Pandemic Rocks Business
Company said its parks division took a $3.5 billion hit due to coronavirus shutdown
The Walt Disney Co. is still reeling from the impact of the ongoing novel coronavirus, reporting a net loss of $4.7 billion for its fiscal third quarter.
The company reported revenue of $11.8 billion during the third quarter which was down 42% from the $20.3 billion the company reported during the same quarter last year. Analysts following the stock via Yahoo! Finance expected Disney revenue to come in at $12.4 billion.
The $4.7 billion net loss equated to a loss of $2.61 per share, that after Disney reported per-share earnings of 79 cents during the year-prior period. Analysts were anticipating a loss of 64 cents per share.
“Despite the ongoing challenges of the pandemic, we’ve continued to build on the incredible success of Disney+ as we grow our global direct-to-consumer businesses,” Disney CEO Bob Chapek said in a statement. “The global reach of our full portfolio of direct-to-consumer services now exceeds an astounding 100 million paid subscriptions — a significant milestone and a reaffirmation of our DTC strategy, which we view as key to the future growth of our company.”
The company’s parks, experiences and products division took a $3.5 billion hit as a result of the coronavirus shutdown. Disney was forced to close parks worldwide back in March, though some, like Disney World in Orlando, have begun to reopen. The parks business is generally Disney biggest contributor to revenue.
“The most significant impact in the current quarter from COVID-19 was an approximately $3.5 billion adverse impact on operating income at our Parks, Experiences and Products segment due to revenue lost as a result of the closures,” the company said in a release. “The negative impact at Parks, Experiences and Products was partially offset by a positive impact at Media Networks.”
Disney’s parks business pulled in $923 million during the third quarter, which was a 85% slide compared with the $6.6 billion in revenue the parks earned during the same period last year.
The studio division, which includes theatrical as well as TV and streaming distribution, garnered $1.7 billion in the quarter, compared to the $3.8 billion a year ago.
The media networks business has remained stable, with revenue dropping just 2% to $6.6 billion. Disney’s direct-to-consumer segment, which includes its new Disney+ streaming service, was the only division to see an increase in revenue, bringing in roughly $4 billion in revenue, compared with the $3.9 billion during the same quarter a year ago.
Chapek said during a call with Wall Street analysts on Tuesday that Disney+ hit 60.5 million paid subscribers as of the beginning of the week.
More to come…
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