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1
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· Posted on
May 10, 2024

Disney finally turns a profit in streaming but its investors are Avenging its poor performance everywhere else

While its streaming services, Disney+ and Hulu finally recorded a profit ($47 million USD in earnings), its old-school businesses were another story.

What's the key learning?

  • A number of Disney’s recent big-budget films like The Marvels, Indiana Jones, and Haunted Mansion struggled to make money.
  • Disney assumed that ramping up the production of these blockbusters was what the fans want, but it didn't pull in the crowds as they expected.
  • It seems like you can have too much of a good thing but as it turns out, can be bad for the business, too.

👉 Background: Disney, in its 100 year history has given us its fair share of classic films. Think: The Lion King, Toy Story, The Avengers, and of course High School Musical.

👉 What happened: But earlier this week, Disney had its worst trading day in a year and half after its share price dropped 10%. While its streaming services, Disney+ and Hulu finally recorded a profit ($47 million USD in earnings), its old-school businesses were another story.

👉 What else: Disney's traditional TV business saw an 8% drop in revenue, while it also experienced a slowdown in its theme park and movie results, after over-saturating the market for too long.

What's the key learning?

💡When it comes to entertainment, a big factor is building anticipation. And too much of a 'good thing' can kill anticipation.

💡Back in the 2010’s, Disney’s fan-following was at its peak, especially for its Marvel and Pixar franchises of films. In fact, Disney's 18 highest earning movies of all time were between 2010 - 2019.

💡But when Disney ramped up production of its Marvel films, it started over-saturating the market and killing the anticipation experience. Now, Disney will be cutting back on Marvel productions and focusing on quality over quantity.

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