Disney’s Shares Continue To Slide

The Walt Disney Company cannot get a break as management tries to turn it around. This weekend the Harrison Ford-driven “Indian Jones and the Dial of Destiny” missed box office sales projections. The movie’s budget has been estimated at an extraordinary $250 million. It was not the only disappointing Disney movie this year. “Lightyear,” “Strange World,” and “Elemental” have all missed industry forecasts.

Disney’s movie production business was supposed to be one of its few bright spots this year. The company’s financial champion–theme parks– remains the core of Disney’s limited success. On the other hand, in the most recent quarter, Disney Media and Entertainment Distribution posted revenue of $14 billion, up 3%. Operating income for the segment was $1.1 billion, down 42%.

In a segment labeled “Direct to Consumer,” Disney’s streaming business had revenue of $5.5 billion, up 12%. But it lost $659 million after losing $887 million in the same period the year before.

Disney used to rule the box office. So far this year, of the top 10 grossing movies domestically, it holds only three spots.

Leaving aside Harrison Ford, Disney’s primary challenge will continue in streaming. Although it has impressive subscription growth, it underpriced Disney+, losing money. It needs to contend with industry leaders Netflix and Amazon Prime Video.

Disney’s stock has been off 10% in the last three months. Netflix trades 28% higher for the same period. Studios revenue, once Disney’s strength, isn’t a strength anymore.

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