14:01 h / 2021/02/12
Content sales and licensing revenues at the Walt Disney Company have suffered big losses at the hands of the pandemic with dramatic decreases of 56 per cent and an operating income decrease of 78 per cent driven primarily by the closure of theatres, parks and experiences over the course of last year.
Lockdown restrictions and social distancing measures played a major role in significantly reduced theatrical distribution from the studio with many theatres across the globe either closed or operating at reduced capacity in the ongoing fight against the coronavirus.
As a result, Disney content sales, licensing and other revenues dropped by over half to $1.7 billion, while segment operating income decreased 76 per cent to $188 million.
Meanwhile, lower TV and SVOD distribution results were driven by the shift from Disney’s licensing of content to third parties to distribution via its own direct-to-consumer services like Disney+.
The studio has attributed the decrease in home entertainment results to lower unit sales, partially offset by lower marketing costs. The prior-year quarter reflected the performance of Toy Story 4, The Lion King and Aladdin compared to no significant titles in the current quarter.
The negative impact of Covid-19 continued to be felt across Disney’s Parks, Experience, and Products segment which saw Q1 2021 revenues plunge 53 per cent to £3.6 billion, with segment operating results dropping $2.6 billion to a loss of $119 million.
As a result of the pandemic, Disneyland Resort was closed and the company’s cruise business was suspended in the current quarter. Disneyland Paris closed on October 30, 2020 and Hong Kong Disneyland Resort closed on December 2, 2020. Walt Disney World Resort and Shanghai Disney Resort were open in the current quarter, but were operating at significantly reduced capacities.
Disney’s consumer products business has however offered the firm a glimmer of light, with operating income growth driven by an increase in games licensing revenue, reflected in the release of Marvel’s Spider-Man: Miles Morales.