Disney reports 4Q loss as some parks remain closed
Disney on Thursday reported millions of dollars in fourth-quarter losses as its California theme parks remain closed amid the coronavirus pandemic, although the corporation still outperformed expectations by analysts.
According to The Associated Press, Disney posted a loss of $629 million, or 39 cents per share, in the three-month period that ended Oct. 3. This, however, was lower than the 73 cents per share that analysts had predicted, according to financial data company FactSet.
Disney’s revenue also fell about 23 percent to $14.71 billion, again higher than the $14.15 billion expected by analysts.
The entertainment company has been able to maintain a substantial amount of revenue through its streaming service, Disney Plus, which launched a year ago and now has 73.7 million subscribers, the AP reported.
Due to the pandemic, the company announced in October that it would be restructuring its business units to focus on streaming. The company created separate content divisions for sports, general entertainment and its production studios, which include Star Wars and Marvel.
Disney Plus has gained success partly through its release of films that had been prevented from opening in movie theaters amid the pandemic, including the live-action remake of “Mulan” and the upcoming Pixar film “Soul,” which is scheduled for a December release.
The company also reportedly plans to launch another international streaming service called Star in 2021.
Florida’s Walt Disney World Resort has reopened to a limited number of visitors, with mask and social distancing requirements, and a phased reopening of California’s Disneyland is set to begin this month.
The company’s other parks in Paris, Shanghai, Hong Kong and Japan have also reopened with limited capacity requirements.
However, the Florida park said in August that it would be scaling back operating hours after seeing fewer visitors than anticipated.
In September, due to limited attendance and diminished revenue at the parks, Disney announced it would be laying off 28,000 employees, which included executive, salaried and hourly workers.
“We initially hoped that this situation would be short-lived, and that we would recover quickly and return to normal,” Josh D’Amaro, chairman of Disney Parks, Experiences and Products, wrote in a letter to Disney employees. “Seven months later, we find that has not been the case.
“For the last several months, our management team has worked tirelessly to avoid having to separate anyone from the company,” he added. “We’ve cut expenses, suspended capital projects, furloughed our cast members while still paying benefits, and modified our operations to run as efficiently as possible, however, we simply cannot responsibly stay fully staffed while operating at such limited capacity.”