Hello cool Aristocats, it’s time for today’s Disney news roundup! As most Disney lovers know by now, the company began celebrating their 100th anniversary starting in January and will continue to do so until the actual anniversary date of October 17. The festivities, officially titled Disney100, involve new attractions like Mickey & Minnie’s Runaway Railway coming to Disneyland California, as well as eight classic films returning to the box office for a temporary theatrical re-release; while the celebration is no doubt spectacular, is it enough to help the company get back on track with shareholders?
It’s no secret that Disney hasn’t been doing as great in the box office this year, and shareholders aren’t too happy with that, nor are they thrilled Disney’s streaming services are losing subscribers and generally under-performing. While a bad box office run isn’t unprecedented — most recently, Disney had a bad run from 2010 to 2013 — it’s becoming increasingly more obvious that it’ll take more than releasing movies like Indiana Jones and the Dial of Destiny to pull the Mouse House out of this predicament.
Disney’s stock gets a downgrade: ‘We have our doubts’ about ESPN and more https://t.co/s2UlnKMVDC
— MarketWatch (@MarketWatch)
Disney hasn’t had a great year when it comes to Wall Street. In May, Disney saw it’s biggest stock decline in six months since CEO Bob Iger returned to his post and despite laying off some 7000 workers, Iger hasn’t been able to allay shareholder’s worries. According to a report from MarketWatch, KeyBanc Capital Markets analyst Brandon Nispel has downgraded Disney’s stock, citing “meaningful uncertainty” as a reason. He lowered his rating of the stock from “overweight” to “sector weight.” If you’re anything like me, these words might not mean much to you, so here’s a (very simple) explanation of why that matters: basically, a stock being overweight means the stock is projected to do well in the near future, but there’s no immediate need for interested parties to rush out and buy stock. Sector weight, from my understanding, is one level lower than that, and while it isn’t telling people to offload their shares and count their losses, it’s not exactly a ringing endorsement.
Nispel cited several concerns over Disney’s stock, including theme park challenges, stand-alone streaming subscriptions, and big-budget films performing poorly in the box office. While Disney’s parks are usually great at turning a profit, Nispel noted that April and May guest turnout was relatively lower than usual, and cited the new labor contract in Florida as a potential problem. Disney Plus lost over 4 million subscribers in the past quarter, and Nispel believes more streaming losses are in store, advising the Mouse to “monetize existing subscribers better through price increases, while establishing a lower-priced subscription advertising tier to retain subs.” He also expressed concern about Disney’s reported plans to make ESPN a stand-alone service, believing even the most passionate sports-lovers won’t shell out $30 a month for a subscription.
Lastly, Nispel spoke about what’s on all of our minds — Disney’s high-budget films struggling to make a profit in theaters. “Are the days of $200M+ productions done?” he titled this portion of his note before addressing poor performances from films like Lightyear and Elemental. The financial analyst is more forgiving to Disney than the subheading suggests; believing the poor showings to be “more of a structural reality that consumers will expect to watch this type of content at home,” rather than the movie’s just being bad.
I’m inclined to agree with Nispel; viewers just don’t want to go to the cinema when they can have a high-quality movie-watching experience in the comfort of their homes. While it’s tempting to blame this reluctance on the COVID-19 pandemic and its aftereffects, research shows that’s not really the case. A 2022 Morning Consult poll showed that while the majority of U.S. movie-goers were more than comfortable going to the theater, 4 out of 5 would rather just watch movies from home. Over 80% of those polled cited financial costs as a reason they weren’t eager to head back to the theater, while 66% said they just weren’t interested in many of the films being released. While this is only one poll, it’s obvious that audiences aren’t buying movie tickets like they used to, and I predict that number will decrease even further as concerns of a recession grow.
Movies like Indiana Jones and the Dial of Destiny would have netted a pretty profit just five years or so ago, but now they struggle to recoup their high-budgets, which are looking increasingly unnecessary in the streaming age. The newest Indiana Jones is expected to make $140-150 million from its global box office, but with a reported budget of an astounding $323 million, that’s barely scratching the surface. Disney has lost nearly $1 billion with its last eight studio releases, and while I’m not the biggest fan of Marvel Studio’s latest movies, they weren’t that bad. I’m not sure what the solution is for Disney but it does feel like blockbusters with massive budgets might be on their way out.
In happier news, several of Disney’s biggest films are returning to theaters as part of its centennial anniversary. Starting in July, each film will be in theaters for two weeks up until the week of Disney’s official anniversary. The films are a collection of popular Pixar films, animated Disney renaissance films, and one live-action film. Tickets for all eight films are already on sale on the Fandango website and ticket prices will vary per location. The eight films and their showing dates are as follows:
Will these eight films returning theaters help Disney inflate its box office numbers? Probably not, but they do provide a fun outing for all ages to enjoy during the hot summer months. Only time will tell if Disney can pull of a similar renaissance as it did in the ’90s but hopefully the House of Mouse’s future is as bright as the fireworks over Disneyland.
Since the moment she listened to her first Britney Spears CD at the tender age of six, Staci has been a lover of all things pop culture. She graduated from UCLA with a Bachelors in Linguistics and somehow turned her love of music, movies, and media into a career as a freelance writer. When she’s not writing for WGTC, she’s busy fulfilling her own pop star dreams as a singer/songwriter or hanging out at her local coffee shops.
This content was originally published here.