Disney Earnings - Strong Results with More Cost Cutting Measures
Disney (DIS)$Disney(DIS.US$ released their Q1’FY23 earnings and they managed to beat the EPS forecast by a huge margin of 25% (EPS of $0.99 versus estimated $0.79). They also managed to beat the revenue estimates by a small margin (Revenue of $23.51 bil vs $23.43 bil).
Bob Iger, CEO of Disney also announced a restructuring plan which includes laying off 7,000 employees and amassing $5.5 bil in cost savings, of which $3.0 bil will be savings from produced and licensed content spent, while another $2.5 bil will be cost saving from reducing headcounts and other operational costs.
In an attempt to improve profit margin, Disney will also be reorganized into 3 divisions:
Entertainment - covering its main TV, film and streaming businesses
ESPN - the sports networks
Parks, Experiences & Products - the theme park division which includes cruise ships and consumer products
Disney+ subscribers declined 1% in the quarter to 161.8 mil, while ESPN and their theme park unit grew modestly in the quarter as consumers put Covid in the rearview mirror, which is mainly attributable to the growth at Disneyland Paris and Tokyo Disney Resort.
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