New York
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The solely Disney information you’re more likely to see at this time is about Josh D’Amaro, the guy replacing Bob Iger subsequent month because the CEO of Disney. But earlier than that announcement got here out, the corporate reported earnings Monday morning. (Which I agree sounds boring, however bear with me.)
Those earnings replicate the black-and-white actuality of the Magic Kingdom that D’Amaro is taking up. In brief: it was a stable quarter, beating most Wall Street expectations, and Disney’s shares nonetheless fell 7% Monday.
Streaming income from Hulu, ESPN and Disney+ had been up extra the 70% year-over-year. And the theme-parks-and-cruises unit — D’Amaro’s personal “experiences” fiefdom — reported a document $10 billion in quarterly income.
Those are the sorts of numbers most media corporations would kill for. But Disney is graded on a curve, and traders have saved the inventory in impartial since 2022, anxiously awaiting the Next Great Era of Disney that Bob Iger’s return to the helm promised.
Now, all eyes are on D’Amaro to complete what Iger began. But it received’t be simple, and there are at the least 5 issues he’s acquired deal with in brief order.
No, not all TV, clearly, however the form most of us grew up on, the place you park your self in entrance of a display and soak up no matter’s on? That’s a dying medium. And that continues to be a large puzzle for not solely Disney, which owns so-called linear TV property together with ABC, ESPN, FX and the Disney Channel, however just about all main media corporations.
The problem is you may’t simply abandon the linear aspect and transfer all the things onto streaming — there are profitable promoting offers and community contracts to maneuver. But the glory days of fats margins from a success TV present are lengthy gone, and it’s not but clear the streaming mannequin — the place competitors is fiercer and viewers consideration extra fractured — could make up the shortfall.
Iger had mentioned Disney would discover a sale of its linear networks, solely to reverse course and argue for holding them. On the opposite hand, Comcast and NCS mum or dad firm Warner Bros. Discovery selected the spin-off route. When D’Amaro’s in cost, he’ll have to decide on: beat ‘em or be a part of ‘em.
2. Streaming stays cutthroat
It’s solely been within the final yr that any streamer apart from Netflix might reliably flip a revenue. Disney is now amongst streaming leaders, with Disney+, Hulu and ESPN raking in $450 million in revenue final quarter. Part of that may be a results of jacking up costs, which works till it doesn’t — an financial downturn, particularly amongst lower-income households, might rapidly ship folks to the “cancel subscription” web page.
This previous fall, Disney acquired a glimpse of how keen clients will be to cancel when ABC abruptly fired Jimmy Kimmel. The obvious capitulation to the Trump administration’s want to yank Kimmel off the air didn’t sit properly with loads of people, and thousands and thousands of individuals canceled their Hulu and Disney+ subscriptions in protest.
ABC in the end returned Kimmel to the air just a few days later, potentially stoking counter-protests from conservatives who noticed that as a capitulation to the liberal backlash.
It’s not clear in the event that they got here again – Disney has stopped offering subscriber numbers.
Disney dominated the home field workplace in 2025 with hits resembling “Zootopia 2“ and “Lilo & Stitch.” But the corporate additionally notched some notable flops. Like, did you catch that live-action Snow White within the theater? How about Pixar’s “Elio?” Yeah, neither did anybody else. How about “Tron: Ares?”
Movies value as a lot as ever to make, however aren’t bringing within the sorts of returns they used to. American box-office gross sales have but to rebound to their pre-pandemic ranges, as extra people decide to skip the $20 popcorn and watch motion pictures at house.
Meanwhile, two of Disney’s largest rivals — Warner Bros. Discovery and Netflix — are merging, doubtlessly making a Hollywood behemoth that would additional eat into Disney’s market share.
4. AI and the eye economic system
Disney’s competitors for our collective consideration was restricted to different film studios and streamers. But the world’s consideration is more and more fractured, and media corporations are actually going face to face with tech corporations like YouTube and TikTok which might be capable of seize hours upon hours of viewing content material that the platforms don’t even should pay for.
In December, Disney tried to get a toehold in that new media ecosystem by striking a three-year licensing deal with OpenAI, which is able to permit customers of its Sora app to include beloved characters into AI-generated movies.
The OpenAI deal will find yourself being one of many final partnerships negotiated by Bob Iger, who’s chargeable for a few of Disney’s best-known and most profitable offers, together with the acquisitions of Pixar and LucasFilm. (It’s not with out threat, although. Allowing your most beneficial IP to enter the world of AI slop dangers diluting the model and alienating the human creators who’ve constructed Disney’s empire.)
(*5*)
5. Iger’s shadow
As if main one of many largest leisure conglomerates on the planet weren’t sufficient, D’Amaro will probably be doing all of it within the shadow of the Bob Iger, the manager who’s been synonymous with Disney for a quarter-century.
He’s additionally an government who didn’t take properly to retirement the primary time round. The final time Iger stepped down, he left the keys to the Happiest Place on Earth within the fingers of Bob Chapek (who, like D’Amaro, had succesfully overseen Disney’s all-important parks and cruises unit).
For a lot of causes, it didn’t go nice. The pandemic closed Disney parks around the globe and slammed the brakes on TV and film manufacturing. Iger didn’t assist Chapek on the PR entrance, both, when Iger determined to tweet his criticisms of a Florida invoice that opponents dubbed “Don’t Say Gay.” Chapek had initially prevented wading into the discourse, taking a impartial place that turned untenable after Iger drew a line within the sand. Chapek bungled the fallout, and as Disney’s enterprise acquired hammered by the pandemic, the board in the end introduced Iger again in to regular the ship.
That cautionary story would hardly be misplaced on D’Amaro, who’s been on the firm for almost 30 years, and firmly embedded within the parks division since 2010.
Disney has sought to make sure followers and traders that this time is totally different. In an interview with CNBC, board chair James Gorman mentioned the CEO succession planning since Iger return has been a “very disciplined, structured process,” and the previous stumbles are behind the corporate.
“We won’t have the drama we had last time,” Gorman mentioned. “That I can assure you.”