Quarterly figures released this week by the company are far from poor. Overall, thanks to a strong performance by the firm’s film division, revenues were up by nine percent between April and the end of June, to USD 14.2bn. Profits are also up climbing to 2.6bn. Nonetheless, upon this news, Disney’s share price fell to near USD 96.
Wherein lies the problem? Simply put, box office receipts are not supposed to be the main revenue generators for Disney. Rather, that honour should go to its media division, a joint enterprise known as Disney-ABC Television Group. This conglomerate incorporates various Disney TV channels, as well as sports station ESPN. And, as once again confirmed by the latest quarterly figures, these enterprises continue to struggle.
The source of the troubles has long been clear – declining cable TV subscriptions. What’s worrying is that almost nothing is being done to fix things. Share traders are showing no such hesitancy. Market analysts are painting a dire picture: the slide will continue as customers continue to transition to Internet-based viewing.
A recent deadly attack by an alligator on a 2-year-old boy near Walt Disney World lake in Orlando, Florida has only added to the company’s headaches.