Today The Walt Disney Company Reported their First Quarter Earnings for Fiscal 2021.
Check out the details below.
The Walt Disney Company today reported earnings for its first fiscal quarter ended January 2, 2021. Diluted earnings per share (EPS) from continuing operations for the quarter decreased 98% to $0.02 from $1.17 in the prior-year quarter. Excluding certain items,(1) diluted EPS for the quarter decreased 79% to $0.32 from $1.53 in the prior-year quarter. Results in the quarter ended January 2, 2021, were adversely impacted by the novel coronavirus (COVID-19). The most significant impact was at the Disney Parks, Experiences, and Products segment where since late in the second quarter of fiscal 2020, our parks and resorts have been closed or operating at significantly reduced capacity, and our cruise ship sailings have been suspended.
“We believe the strategic actions we’re taking to transform our Company will fuel our growth and enhance shareholder value, as demonstrated by the incredible strides we’ve made in our DTC business, reaching more than 146 million total paid subscriptions across our streaming services at the end of the quarter,” said Bob Chapek, Chief Executive Officer, The Walt Disney Company. “We’re confident that, with our robust pipeline of exceptional, high-quality content and the upcoming launch of our new Star branded international general entertainment offering, we are well-positioned to achieve even greater success going forward.”
Since late in the second quarter of fiscal 2020 and continuing into fiscal 2021, COVID-19 and measures to prevent its spread have impacted our segments in a number of ways, most significantly at Disney Parks, Experiences, and Products. In the current quarter, our theme parks were closed or operating at significantly reduced capacity and cruise ship sailings and guided tours were suspended. In addition, we have delayed, or in some cases, shortened or canceled, theatrical releases, and stage play performances have been suspended. We have experienced disruptions in the production and availability of content, including the cancellation or shift of key live sports programming from fiscal 2020 into fiscal 2021, as well as the suspension of production of most film and television content. Although most film and television production resumed beginning in the fourth quarter of fiscal 2020, we continue to see disruption of film and television production depending on local circumstances. We have incurred and will continue to incur, additional costs to address government regulations and implement safety measures for our employees, talent, and guests. The timing, duration, and extent of these costs will depend on the timing and scope of our operations as they resume. We currently estimate these costs may total approximately $1 billion in fiscal 2021. Some of these costs may be capitalized and amortized over future periods.
The most significant impact on operating income in the current quarter from COVID-19 was an estimated detriment of approximately $2.6 billion at the Disney Parks, Experiences, and Products segment due to revenue lost as a result of the closures and reduced operating capacities. The impacts of COVID-19 on our Disney Media and Entertainment Distribution segment were less significant. Higher sports programming costs reflecting the shift of key sporting events from prior quarters to the current quarter were largely offset by higher advertising revenue related to the broadcast of the events. Lower revenues due to the deferral or cancellation of significant film releases as a result of theater closures were largely offset by the related reduction in film cost amortization, marketing, and distribution costs.
The biggest takeaway is that the Disney Parks, Experiences and Products revenues for the quarter decreased 53% to $3.58 billion, and segment operating results decreased $2.6 billion to a loss of $119 million.
If you are into numbers it is quite a lengthy read. You can Click here to see the full pdf of the First Quarter Earnings for Fiscal 2021.