Walt Disney Company reported earnings for its third fiscal quarter ended 3 July 2021. The company reported earnings of $995 million in the third quarter, a significant improvement from the $4.8 billion loss posted this time last year.
Since early 2020 and continuing into 2021, COVID-19 and measures to prevent its spread have impacted company’s segments in a number of ways, most significantly at the Disney Parks, Experiences and Products segment where the theme parks and resorts have been closed and cruise ship sailings and guided tours have been suspended. Theme parks and resorts resumed operations, generally at reduced capacity, at various points since May 2020 through June 2021.
On speaking at post-earnings call with investors and analysts, Disney CEO Bob Chapek said, “We ended the third quarter in a strong position, and are pleased with the Company’s trajectory as we grow our businesses amidst the ongoing challenges of the pandemic. We continue to introduce exciting new experiences at our parks and
resorts worldwide, along with new guest-centric services, and our direct-to-consumer business is
performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at
the end of the quarter, and a host of new content coming to the platforms.”
Disney+ carried the company through the pandemic as parks remained closed and operated at limited capacities. The platform released Black Widow and Jungle Cruise through its Premier Access Function, which gives subscribers the opportunity to watch movies on Disney+ the day they’re released in theaters for an additional charge of $29.99. The movies brought in $60 million and $30 million respectively via Disney+ alone. Linear Networks revenues for the quarter increased 16 per cent to seven billion dollar, and operating income decreased 33 per cent to $2.2 billion.
Domestic Channels revenues for the quarter increased by 13 per cent to $5.6 billion and operating income decreased by 37 per cent to $1.8 billion. The decrease in operating income was due to a decrease at Cable and to a lesser extent, at Broadcasting.
International Channels revenues for the quarter increased by 29 per cent to $1.4 billion and operating income decreased by 23 per cent to $169 million.
Direct-to-Consumer revenues for the quarter increased by 57 per cent to $4.3 billion and operating loss decreased from $0.6 billion to $0.3 billion. The decrease in operating loss was due to improved results at Hulu.
Disney Parks, Experiences and Products revenues for the quarter increased to $4.3 billion compared to $1.1 billion in the prior-year quarter. Segment operating results increased $2.2 billion to income of $356 million.
However, doe to the surge in Delta variant cases in US , the business of company’s theme parks will be affected. Disneyland Paris in July began requiring guests to present proof of vaccination, a negative PCR test result or a positive antigen test proving they have already been infected with Covid before they can enter the park.