$DisCharts - Sports & Entertainment Q2FY24

Sports & Entertainment

Revenues on the media side of the company have been hindered mostly by the ‘Content Sale & Licensing’ division which is where the Studios report. Box office declines and huge reductions in licensing out content have contributed to overall revenue decline. Cost declines are nice to see but again this is due to Disney not putting out any feature films. Direct to consumer costs have levelled of with Disney plus content spend seeing recent declines.

Sports & Entertainment Margin Breadown

Linear networks make the most money for the media side of the company. Even as revenues slowly decline, margins being extracted are very healthy.

Linear Networks - before and after Sports (ESPN) was removed.

Direct to Consumer

Costs have plateaued while revenues have seen a steady increase every month. We are in the midst of seeing Dis+/Hulu go black. A drastic turnaround from the last days of Chapek.

Content Sales & Licensing

Studios are cause for concern in this paradigm shift we are seeing toward streaming/internet based platforms and away from traditional consumption methods. Box office and (a lack of) licensing are starving Disney of revenue that was once the envy of the industry. They have pivoted to less feature films and put more focus on creativity and quality. This may help box office but Disney’s decision to walk away from licensing content in favor of putting all its own content on Dis+/Hulu has put this division in the red.

Sports

Sports is a strong division and Disney’s choice to break out the numbers from linear networks is likely made as they are choosing to move the main ESPN channel to streaming in the near future. Advertisers love live sports and especially the NFL.