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Hollywood Earnings Roundup: Bob Iger Bullish on Disney’s Future Amid Strike Uncertainty

As the WGA strike eclipses the 100-day mark, Hollywood is starting to feel the heat. Boardroom breaks down the quarterly earnings reports for Disney, Paramount, Sony, and Lionsgate.

Disney was only one of several Hollywood studios to release a fiscal snapshot this week. The news comes as writers and actors continue to strike amidst ongoing negotiations with production companies — the Writers Guild of America’s strike hit 100 days on Aug. 9 as SAG-AFTRA continues to stand in solidarity, and production companies are beginning to feel the effects.

With that in mind, let’s break down some of the high-level takeaways laid out in earnings reports from Disney, Lionsgate, Paramount, and Sony.

Hollywood Studio Earnings Overview

Disney

Bob Iger’s second dance at Disney is proving to be a little more complicated than he may have realized upon resuming his role as the company’s CEO. The House of Mouse released its Q3 earnings report on Wednesday, which continued struggles. However, always the optimist, Iger pointed to signs that the struggles were about to turn to success.

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Key takeaways from Disney’s recent earnings report:

  • Total revenue netted out at $22.3 billion (+4% from the previous quarter), coming up just short of a $22.5 billion projection.
  • The TV line of business experienced a sharp decrease for the second straight quarter. ESPN continues to be impacted by league-owned efforts to capitalize on large-scale profits. 
  • Streaming losses were down to $512 million as the House of Mouse continues to keep pace in the war for audience attention. In response, the company announced subscription price increases coming in October, which will raise the Disney+ platform’s ad-free tier from $12 to $15 a month. Additionally, Disney-owned Hulu bumps up from $15 to $18. Iger is interested in buying out Hulu minority partner Comcast and owning the platform outright.
  • The company posted $2.65 billion in one-time payments throughout the quarter after it stripped several offerings from its streaming services.
  • A bright spot came via Disney’s parks, experiences, and products division, which enjoyed a 13% increase from the previous quarter.
  • The company’s stock increased 4% overnight in response to the report.

Lionsgate

The Hollywood giant’s fiscal Q1 earnings report highlighted some struggles related to the prolonged nature of the WGA and SAG-AFTRA strikes. Previously, Lionsgate announced that it was spinning off premium cable network Starz as a separate entity; however, the plans are now up in the air due to the compounding issues confronting all of Hollywood.

Key takeaways from Lionsgate’s recent earnings report:

  • Lionsgate is prioritizing moving forward with its acquisition of entertainment company eOne. Hasbro, eOne’s parent company, agreed to terms with Lionsgate on Aug. 3 to offload its television and movie assets for a reported $500 million.
  • In order to accelerate the eOne deal, Lionsgate will momentarily pause its decision-making on Starz. Instead, it will look to expand the network’s reach in the US and Mexico while slowing efforts elsewhere in Latin America.
  • Shares dropped $0.31 throughout the quarter, which was up as compared to the $0.53 decline last year at this time.
  • Lionsgate is bullish on upcoming releases, which included The Hunger Games: The Ballad of Songbirds and Snakes and Saw X.

Paramount

The legacy studio made a major move this week, announcing that it was selling publishing house Simon & Schuster to private equity firm KKR. Additionally, in an effort to close production gaps, it will move reruns of its hugely popular Yellowstone to CBS starting this fall.

As Paramount CEO Bob Bakish reflected on the Q2 outcomes, “We maintained our focus on scaling our streaming platforms, maximizing our traditional business, and building a sustainable business model that will return the company to significant earnings growth in 2024.”

Key takeaways from Paramount’s recent earnings report:

  • Paramount+ logged 61 million users
  • KKR will acquire Paramount Global-owned Simon & Schuster for a reported $1.6 billion. Employees will be offered an equity stake in the transaction, a model KKR has utilized for past acquisitions to smooth transitions.
  • Analysts raised their projections for the stock price in the coming quarter while acknowledging that Paramount has a number of challenges ahead.
  • The company’s stock price increased upon the report, which demonstrated better-than-expected earnings overall.

Sony Pictures

It was a mixed earnings moment for Sony. On the music side, performance surged on the back of continued success from recent drops from artists like SZA and Harry Styles. Similarly, the games projections steadily rose after a 28% bump in sales for its PlayStation video game consoles. However, despite the success of Spider-Man: Across the Spider-Verse, which drew $591 million globally, the company saw a significant decrease in year-over-year sales and operating income in fiscal Q1.

Key takeaways from Sony Pictures’ recent earnings report:

  • It saw a 71% year-over-year decrease in operating income, coming in at $115 million.
  • Sales decreased from $2.64 billion to $2.33 billion year-over-year, largely due to a comparative decline in the number of television series and film distribution opportunities.
  • Theatrical sales were up comparatively.
  • Despite a difficult quarter, annual profit projections remained the same at $838.1 million for its fiscal year, which ends on March 30, 2024.
  • Sony’s stock dropped 5% after the release of the report.

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About The Author
Bernadette Doykos
Bernadette Doykos
Bernadette Doykos is the Senior Director of Editorial Strategy at Boardroom. Before joining the team, her work appeared in ELLE. She previously served as the head of evaluation for a nonprofit where she became obsessed with systems and strategy and served as the curator of vibes and extinguisher of fires for the design thinking firm Stoked. She is constantly plotting a perfect tunnel ‘fit and a playlist for all occasions.