Disney+ Misses Subscriber Goal & Stocks are Plunging… But Why?

 

The Walt Disney Company has relied on theme park vacations, cruises, sports, and the movie industry for almost all of its business before the pandemic, and each came to a virtual standstill when it struck. That’s when Disney management pivoted quickly and created a television streaming segment that blossomed while its other businesses were on hold.

 
Now, as the pandemic and lockdowns appear to be lifting, Disney+ reported a big miss last week and their stock tanked.
 

In a second quarter earnings call, Disney CEO Bob Chapek revealed that earnings came in stronger than anticipated for the fiscal period that ended on April 3, with most divisions, including theme parks, outperforming expectations. Yet despite this good news, the stock tumbled more than 4% in after-hours trading on Thursday.

Why? Because one key sector underperformed forecasts by an alarming degree: Disney+’s subscription rate.

 

The subscription miss comes as the Walt Disney Co. is still dealing with fallout from the revelation that it promoted critical race theory to its employees, encouraging them to strive for “equity,” or the “equality of outcome,” and to reflect on America’s “racist infrastructure”. Then on Thursday, Disney reported subscriptions for its Disney+ streaming service had reached 103.6 million, which reportedly fell below the Wall Street consensus of 110 million subscribers. The subscription miss was surprising since the company had heavily promoted the new series WandaVision and The Falcon and the Winter Soldier.

 

 

The blowback comes after a recent poll showed that nearly two-thirds of Americans believe companies like Disney have taken political correctness too far. The company has announced changes to its popular theme park rides Splash Mountain and Jungle Cruise after leftist activists complained that they are racist. Disney+ has also implemented new culture warnings on several of their classic films, and even begun to edit and censor parts of movies on the streamer, upsetting many subscribers. Did they not learn any lesson from their competitor’s 10% loss in stock value when they dove head first into cultural activism?

 

 

Are consumers beginning to tire of force-fed propaganda from elitist corporations? Are they growing sick of political activism from “woke” companies? Are they starting to realize they have economic power and have started to use it?

Karina Smitt

I'm not as much of a "CoMiCs NeEd MoAr DiVeRsItY & iNcLuSiOn" advocate as my girlfriend often is, but we both love funny books, crispy bacon, straight bourbon and hip hop. Add yet, we never vote the same, so we cancel each other out... and that works perfectly in my book!

JUST KEEPING THE LIGHTS ON