The economy hits Walt Disney
The economical crisis also beats the Walt Disney company. Not even the big mouse is saved from the economy.
The company during its first quarter plummeted 32 percent to $845 million vs. $1.25 billion during the same quarter a year ago. Total revenue dropped to $9.6 billion. The company was hardest hit by a 64-percent drop in profits for its movie unit, as consumers cut back on DVD purchases during the crucial Christmas holiday period. However, company chairman Robert Iger commented, “We don’t believe the changes we’re seeing in consumer behavior can all be attributed to a weak economy. … It’s important for us to address them as more than cyclical issues.” (Indeed, the poor showing comes at a time when many economists are remarking about the surprising robustness of the entertainment media in the face of the current recession.) With Disney’s ABC television network mired in last- or next-to-last place — its household ratings are down 7.7 percent — it was not surprising that it was hit harder than its rivals by the general retrenchment in advertising. Sales for ABC, ESPN, Disney Channel, ABC Family and local owned-and-operated stations were down 60 percent. Finally - a first among the big media companies - Disney broke out figures for its new media businesses under the category “interactive media.” The unit, it said, lost $45 million. However, it appeared that the figures did not include revenue and costs associated with making Disney’s movies and television shows available on the Internet - a sticking point in negotiations with the industry’s unions.
Thanks Contactmusic.com for the information.