Disney’s Mufasa - the lion king

[Disney Irish]

Anyways if we’ve had enough of Business Econ 101 for a day….

Mufasa is at $653M WW

 

[easyrowrdw]

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This does not say that cuts and price increases at the parks happen because they lose money at the box office.

Oh look. I Googled it. Do we trust Google these days?
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Yeah I don’t think you need google to “prove” that revenues from one part of the business are used to fund other parts. You’re obviously correct. It’s not like Disney+ was self-sustaining when it launched. Parks have long been a cash cow for Disney.

 

[Disney Irish]

Yeah I don’t think you need google to “prove” that revenues from one part of the business are used to fund other parts. You’re obviously correct. It’s not like Disney+ was self-sustaining when it launched. Parks have long been a cash cow for Disney.

Except you can also say that Studios is also funding the Parks, and so is every other part of the company. One division is not solely funding another division, that is point as its not how companies work no matter how much of a cash cow you think something is. And the point was also that no matter the loses at the box office it’s not directly affecting the Parks.

 

[MisterPenguin]

During COVID, it was the studios, mostly TV, that kept the parks from going bankrupt.

Then it was the parks turn to subsidize streaming until it became net positive.

Now, the parks profits will go toward the $60B capex in the parks.

A diversified portfolio of income segments is what keeps Disney strong.

 

[easyrowrdw]

Except you can also say that Studios is also funding the Parks, and so is every other part of the company. One division is not solely funding another division, that is point as its not how companies work no matter how much of a cash cow you think something is. And the point was also that no matter the loses at the box office it’s not directly affecting the Parks.

I didn’t see an indication that one was solely funding another but I might have missed that comment. But struggles in one area of a business will absolutely impact other areas. You gotta make up for it somehow if you’re gonna hit your targets.

 

[Disney Irish]

I didn’t see an indication that one was solely funding another but I might have missed that comment. But struggles in one area of a business will absolutely impact other areas. You gotta make up for it somehow if you’re gonna hit your targets.

Again not that simple, its a healthy business that uses profits from all business units to fund the rest of the business units. Again this is normal, so not sure why this is even such a heartache to understand. And again its something Disney has been doing since the beginning days of the company when Studios literally built the Parks.

I think what some have issues with is trying to reconcile how no new investments or cuts can happen in Parks when Studios can have Millions spent on them. And again I say to that, its not that simple. Funding for large capital investments like new attractions and such for the Parks doesn't just come out of nowhere. It takes funding from the entire company to do that including from Studios. Targets are set on each business unit and those targets must be hit, if not that is when cuts happens. Most don't pay attention to the cuts that happen in Studios for example, but they do happen, like cancelling shows and movies. Its only the cuts and price increases to Parks that people around here pay attention to, which is why I keep saying "its not that simple". You cannot directly attribute xyz movie or xyz bad box office year losses to zyx cuts and price increases in the Parks. Yes the Parks are asked to tighten their belt when the rest of the company isn't performing, but so is every other business unit inside TWDC, they just are as publicized as Parks.

This is why this simplistic view that "Parks funds everything" is a misconception of how corporate economics works, especially inside TWDC.

 

[Disney Irish]

During COVID, it was the studios, mostly TV, that kept the parks from going bankrupt.

Then it was the parks turn to subsidize streaming until it became net positive.

Now, the parks profits will go toward the $60B capex in the parks.

A diversified portfolio of income segments is what keeps Disney strong.

Everyone forgets that first part.