by Thinus Ferreira
In the first quarterly earnings report since he's back as Disney CEO, Bob Iger made several announcements and spoke and gave clarity about several issues - including that Disney+ lost 2.4 million subscribers and is also making more Frozen, Zootopia and Toy Story movies.
Here are 5 takeaways from Disney's latest earnings report:
1. Disney+ lost subscribers
Disney lost 2.4 million subscribers worldwide during the last three months of 2022 and now has 161.8 million subscribers globally.
This is noteworthy since this is the first decline in Disney+ subscriber numbers since Disney+, which is available in South Africa since last year, launched in the United States in late-2020. Like the majority of streamers, Disney+ isn't profitable but Bob Iger believes Disney+ will turn profitable sometime in 2024.
2. Maybe less, but better content
In the arms race known as the "streaming wars", companies just threw money to produce a lot of content to try and catch up with Netflix, and to attract subscribers and scale up their service offerings - Disney+ included. That period is now fast coming to an end.
"We are going to take a really hard look at everything we make across television and film because things in a more competitive world have just simply gotten more expensive," Bob Iger said on the earnings call and noted that "we were as a company in a global arms race for subscribers".
He also said "We want the quality on the screen, but we have to look at what that costs us".
"In our zeal to go after subscribers, I think we might have gotten a bit too aggressive in terms of our promotion. We took our pricing up substantially on Disney+ and we only suffered a de minimis loss of subs. That tells us something. It may also tell us that the promotion to chase subs that we've been fairly aggressive at, wasn't absolutely necessary."
3. Streaming makes less money but is the future
Bob Iger said that streaming services like Disney+ are not as profitable as linear pay-TV channels but that video streaming is the future and that is what Disney is focused on growing.
"The streaming business, which I believe is the future and has been growing, is not delivering the kind of profitability or bottom-line results that the linear business delivered for us over a few decades. And so we're in a very interesting transition period, but one I think, which is inevitably heading towards streaming."
4. More Frozen, Zootopia and Toy Story
More Elsa! More Buzz Lightyear! More Gazelle! Bob Iger confirmed that Disney will be making further instalments of the hugely popular films Frozen, Zootopia and Toy Story.
"I'm so pleased to announce that we have sequels in the works from our animation studios to some of our most popular franchises, Toy Story, Frozen and Zootopia," Bog Iger said. "We'll have more to share about these productions soon, but this is a great example of how we're leaning into our unrivalled brands and franchises."
5. Eliminating 7000 jobs
On Disney's earnings call, Bob Iger confirmed that The Walt Disney Company is cutting 7 000 jobs which will represent a reduction of 3.2% of its global workforce of 220 000 people. Bob Iger says the retrenchment are done to cut costs.
