By Mae Anderson, Business Writer
NEW YORK (AP) --Disney is feeling some pain from its biggest transformation in decades as its acquisition of Fox's entertainment businesses contributed to a 39% drop in earnings.
CEO Bob Iger said one of the biggest issues affecting earnings was underperformance at the Fox movie and TV studio. Tuesday's results, the first complete quarter with Fox's businesses included, missed Wall Street's expectations. Disney's shares fell 3% in aftermarket trading.
The Fox studio was "well below where we hoped it would be when we made the acquisition," Iger said during a conference call with analysts.
Particularly underperforming was "Dark Phoenix," a Fox X-Men movie that failed to find its audience. That offset box office successes such as "Avengers: Endgame."
Disney completed its $71 billion acquisition of Fox's entertainment business in March, putting "Cinderella," ?The Simpsons," ?Star Wars" and "Dr. Strange" under one corporate roof. The deal paved the ways for Disney to boost its streaming ventures, with the addition of Fox videos. In May, Disney also gained full control of Hulu after Comcast sold its stake in the streaming service.
Iger said it would be two years before Disney can have an impact on the Fox films in production.
"We're all confident that we're going to be able to turn around the fortunes of Fox live action and you'll see those results in a couple of years," he said.
Disney also spent more money on its ESPN Plus and upcoming Disney Plus streaming services. And its results were hurt by taking control of Hulu, including a $123 million charge as it lowered its estimated valuation of the service.
Disney said Tuesday that it will offer its three streaming services in a package for $13. Hulu now costs $6, and ESPN Plus costs $5. The upcoming Disney Plus service will cost $7. So the package will represent a $5 savings. Disney is making the package available Nov. 12, the same day Disney Plus is launching.
Disney is turning to its own streaming services to compete with Netflix as people drop traditional cable services, and Disney loses revenue from its ESPN and traditional channels.
Iger said Disney Plus won't have as much video as rivals such as Netflix might have, but it will have quality, including launching with eight "Star Wars" movies, 18 Pixar movies, 70 Disney animated movies, 240 Disney live action movies and 7,500 episodes of Disney TV. The service will launch with four Marvel movies, with eight more to come during its first year.
For the fiscal third quarter, which ended June 29, net income fell to $1.76 billion, from $2.92 billion last year. Excluding one-time items, income totaled $1.35 per share. Earnings from continuing operations fell to $1.44 billion, or 79 cents per share. Analysts surveyed by FactSet expected net income of $1.72 per share.
Revenue rose 33% to $20.2 billion from $15.2 billion, short of the revenue of $21.4 billion analysts expected.
Mike Pierantozzi joins Movers+Shakers as exec creative director
Creative agency Movers+Shakers has appointed Mike Pierantozzi as executive creative director. In this new role, he will help guide the creative direction of Movers+Shakers’ socially-native campaigns. Pierantozzi will report to co-founder and chief creative officer Geoffrey Goldberg.
With nearly two decades of experience as a copywriter, creative director, and multi-platform storyteller, Pierantozzi brings a wealth of knowledge from his work with major brands including Kraft, Unilever, IBM, and Walmart. He has led the creation of award-winning campaigns for agencies like Red Tettemer, Ogilvy, The Brooklyn Brothers, TAXI, Saatchi & Saatchi, and most recently, Vayner, where he spearheaded culturally iconic work for Planters including “Death of Mr. Peanut.” He led the National Down Syndrome Society and Luvs account, whose “First Kid. Second Kid” campaign was awarded by the Effies, ADC, Clios and LIAs.
Outside of the office, Pierantozzi practices what he teaches brands. He’s gone viral multiple times on his own TikTok account, featuring comedic interactions with his son and a trombone. He’s accumulated 15K followers on TikTok.
“Mike brings a rare and awesome combination of deep social and platform experience, a keen eye for excellent storytelling, and a humble and kind approach to leadership,” said Goldberg. “Mike’s got a knack for turning brand stories into cultural movements, making him the perfect fit for Movers+Shakers. He’s got the kind of bold vision and attention to culture that fits perfectly with our mission to push creative boundaries and drive industry firsts. Plus, as a creator himself he has the innate ability to make people stop, laugh, and share--which is exactly what we’re about.”
“I’ve... Read More