Disney annual report presages monster content spending for coming year
It's that time of year for $Disney(DIS.US$ annual report, and poring through its length gives some clues to the company's investment plans ahead.
Coming to the forefront of key questions for streaming services is the still-growing need for ever more content to feed them; Disney's no exception there, and it gave considerable attention on its earnings call earlier this month to the rebound it expects when the programs it's planning make their way through the pipe.
The annual report gives an indicator of Disney's seriousness there. It currently expects fiscal 2022 spend on "produced and licensed content, including sports rights" to be as much as $33 billion - about $8 billion more than an already-high 2021 figure.
That boost is "driven by higher spend to support our (direct-to-consumer) expansion and generally assumes no significant disruptions to production due to COVID-19," the company says.
As for corporate-wide capital expenditures, it's looking to raise those in 2022 to $6.1 billion from 2021's total of $3.6 billion, expecting "higher spending on cruise ship fleet expansion, corporate facilities and production facilities and technology" at its Disney Media and Entertainment Distribution segment.
The report also lays out the number of subscribers to Disney's linear pay-TV channels, and they indicate a still-hefty decline in ESPN subs, among the priciest in all of pay television.
Domestic subscribers to ESPN fell to 76 million from 2020's 84 million. (Considering bundling, 76 million also represents the number of subs for Disney Channel, ESPN 2, Freeform, and National Geographic.) For the Fox channels it inherited in its acquisition of those media assets, FX had 77 million subscribers in 2021, while FXX had 72 million and FXM 47 million.
On an international basis, Disney Channel has 162 million subscribers; ESPN has 64 million; Fox has 184 million; and National Geographic 320 million. Star General Entertainment has 132 million subs while Star Sports has 84 million.
Disney's expecting to rule the long holiday weekend at the box office with the most recent release from its animation department, Encanto.
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Aaron_Kelly : ESPN lost 8 million subs yet content spending is going up 8 billion? How long can Disney keep losing millions of ESPN subs annually with sports rights seemingly going up and up?
Harper lee : Their content still sucks.
Will never come close to Netflix, will always be playing catch-up to them.
Johnny Thunders Harper lee: lol Netflix content blows
Apollod Wed : The fcf burning train continues at this rate shareholders won’t get their 50b back from buying fox cable this century
ajkZbCYC8Q Apollod Wed: So what you are telling me is that disney is a "disruptor"? The valuation is way too low!
tk0TEeeFdX : Disney knows how to spend money. How to make money, not so much.
Sports rights are a financial black hole. They are for media companies what 5G is for telecoms.
TpdPfbWje4 : They're going to need to earmark about $20 billion to pay off Comcast for their Hulu stake in a few years or sooner.
2znASYonpa : Looking forward to DIS delivering on their promises of continued content creation. There have been a number of huge hits, great content, and it needs to keep rolling. Boba Fett coming out shortly, along with Obi-Wan next year, should both be interesting.
Long DIS
vk3XubZ0kD : I am not the expert here by any means, but I thought the rationale for buying 20CF was the treasure trove of content. Why is so much more spending
YCUMO vk3XubZ0kD: Because Warnermedia-discovery is coming and with 8.6b fcf will start eating marketshare. I doubt it will help tho. Warnermedia-discovery will be too powerful when they merge with the most fcf by far!
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