Disney’s Q2 FY24 Earnings Results Webcast

[Slpy3270]

Disney expects a DTC loss for Q3 and net sub losses for that segment as well.

 

[CaptainAmerica]

Shogun gets a streaming shout.

Because of how the business is structured, the cost of that show almost entirely hits the Cable networks, but Hulu is getting the benefits.

A perfect show.

 

[doctornick]

Indeed the important part:

The company reported its fiscal Q2 earnings early Tuesday morning, disclosing that its combined direct-to-consumer businesses of Disney+, Hulu and ESPN+ lost only $18 million last quarter, on revenues of $6.2 billion, and that when ESPN+ is removed from that equation, the entertainment streaming business was actually profitable, with revenues of $5.6 billion and a net profit of $47 million.​

So ESPN+ streaming lost $65M for the quarter, right? Sports is an an interesting crossroads as there is still a lot of value in them with people actually watching them live - so advertising revenue actually works - but I think the big issue is that rights fees are overinflated at this point. They made sense when you had bundled ESPN channels for cable/satellite and non-sports fans were all subsidizing the channels. Relaying more on sports fans directly will probably allow for some higher charges to them but the loss of volume is huge and really can only be addressed with smaller rights fees.

I wouldn't want to be a league selling TV rights in the next few years.

 

[monothingie]

"normalization of post-covid demand"

 

[peng]

And they just admitted that they're expecting a drop in attendance in business speak

 

[Slpy3270]

$1 billion of stock repurchased in Q2.

 

[CastAStone]

This is the worrying thing for me. If I'm reading this correctly, the domestic Experiences increases come down to "inflation" and "we charged more for what we already have." Is that right?

Bingo!

I don’t know, it’s hard to completely discern, but it sounds like pricing net of commodities and labor was definitely negative at Disneyland and may have been negative at WDW.

They specifically called out increased demand at both parks, which is supposed to mean volume.

 

[CastAStone]

"normalization of post-covid demand"

Which is not happening in the cruise industry, and I can’t get past that fact.

 

[lentesta]

Let's see if that park question gets answered.

 

[HauntedPirate]

No comments on the $1 billion stock buy backs?

Hate them.

 

[lentesta]

I'm interested that Bob specifically mentioned 'recommendation engines'.

 

[MisterPenguin]

Q: about 'demand'... what's your expectation of attendance at parks? Operation margin coming in when on streaming?

A: Hugh.

On attendance. Parks had a 10% growth, which is high. But won't be that high continuing.

Q3 will have big one-time expenses, so Q4 will be double digit margin.

Streamers: we got stuff happening. Latin America will have Star bundled into D+. And other good stuff internationally.

 

[doctornick]

Disney expects a DTC loss for Q3 and net sub losses for that segment as well.

All the Swifties drop their subs

 

[CastAStone]

Q3 will have big one-time expenses

Me, a person on the call:
PLEASE ELABORATE

Could this be accelerated depreciation of some rides/shows/attractions they’re replacing before they’ve run through their full schedule? Or is this all new cruise ships?

 

[CaptainAmerica]

Me, a person on the call:
PLEASE ELABORATE

Could this be accelerated depreciation of some rides/shows/attractions they’re replacing before they’ve run through their full schedule? Or is this all new cruise ships?

I thought he said cricket rights.

 

[MisterPenguin]

Q: About ESPN and rights, you sound bullish... what's coming up for the next few years? Especially with license going up.

What's up with IP you have, especially Marvel IP?


Bob: Ratings of digital and live sports is strong. Sports will stand out among all other entertainment. ESPN tile will be on D+, as a start of digitalizing ESPN and sports. And it will help the bundle. But we're not abandoning cable -- giving a choice. Lots of distribution channels.

We've locked up long time licenses. We hope to also have the same with NBA.

IP -- good slate coming up. But we're still reducing the TV pipeline.

 

[monothingie]

"We've got a couple of good films in 25"

"IP Mining"

 

[monothingie]

Pre-Market $DIS down about 10% now.

 

[CaptainAmerica]

Pre-Market $DIS down about 10% now.

We are so back.

Just wait until people get to ride Broccoli Mountain.

 

[lentesta]

Me, a person on the call:
PLEASE ELABORATE

Could this be accelerated depreciation of some rides/shows/attractions they’re replacing before they’ve run through their full schedule? Or is this all new cruise ships?

It sounds like it's cruise ships and the new island, from other folks I'm texting during the call.