Disney Will Report Streaming Profitability After Revised Subscriber Projections and in the Wake of Cost Cutting

LOS ANGELES, CA – The entertainment giant, Disney, is gearing up to release its first-quarter earnings report, with CEO Bob Iger shifting the focus to profits, aiming to overcome a proxy battle and potential subscriber losses. The company faces challenges following a round of price hikes which is expected to result in a decline in the number of subscribers. Meanwhile, investors will be closely watching for signs of progress in the company’s cost-cutting initiatives and improvements in streaming profitability.

Wall Street analysts project Disney’s total revenue to reach $23.80 billion, with adjusted earnings per share at $1.01. The company’s streaming platform, Disney+, is expected to experience a quarterly net loss of 174,000 subscribers. Analysts highlight the importance of long-term streaming profitability in potentially elevating Disney’s stock performance.

Additionally, the market will be watching the performance of Disney’s new CFO, Hugh Johnston, as he faces the task of achieving profitability and implementing cost-saving measures across the organization. The company has committed to significant cost cuts in recent years, with potential layoffs looming in Disney’s animation unit, Pixar.

Disney also faces challenges in its box office performance, as the studio unit is expected to underperform in the quarter due to lackluster titles. The company is also unloading non-core assets, recently reaching a preliminary agreement to sell 60% of its India unit.

The report will also shed light on the future of ESPN’s streaming ambitions, with news breaking of a partnership between Disney’s ESPN and Warner Bros. Discovery and Fox to launch a new sports streaming service. This adds to Disney’s ongoing efforts to seek strategic partners for its flagship direct-to-consumer service.

Furthermore, Disney is still locked in a proxy battle with activist investor Nelson Peltz of Trian Management, which remains a point of concern for investors. The ongoing dispute has potential implications for the company’s long-term strategy.

The release of Disney’s earnings report will be a crucial moment for the company to alleviate investor concerns and showcase its ability to navigate the evolving landscape of the entertainment industry.