September 2019


Disney Is Unhappy With Star TV's Q-3 Performance

Star India's earnings have dragged down earnings of its parent - The Walt Disney Company.

"This quarter (Q-3 2019) included an operating loss at Star of about $60 million, which generated about $150 million of operating income in Q-3 last year. Star's results this quarter came in well below our expectations." Disney Senior EVP & CFO Christine McCarthy said. She attributed the deficit to weakness in the Indian advertising market. The rained-out ICC World Cup games, will be compensated by insurance.

"Star's results this quarter came in well below our expectations"

- Christine McCarthy

The 21CF film studio lost about $170 million, compared to about an income of $180 million in Q3 last year.


Star India is paying astronomical amounts for the Indian Premier League (IPL) and ICC Cricket World Cup rights. The amounts increase annually, during the contract period & Star has not been able to break even on cricket for the past 2 years. The cricket rights have drawn eyeballs but financially have become the proverbial 'White Elephant.'


The 21CF deal also added Hotstar to Disney's portfolio.

Talking of Hotstar which currently operates in India, USA, UK & Canada, Walt Disney Company chairman & CEO Bob Iger said, "To give you an idea of the value of this platform, last quarter, Hotstar had more than 300 million average monthly users, served an unprecedented 100 million daily users and delivered a high-quality streaming experience to 25.3 million simultaneous users, which is a new world record."

He also revealed that Hotstar will be expanded across South East Asia. "The platform's broad array of premium sports rights will serve it well over the next 5 years especially as we expand the service into markets across Southeast Asia."


Disney's independent performance was on track.

Cable Networks Q-3 revenue increased 24% to $4.5 billion (₹ 31,500 Crores) and operating income increased 15% to $1.6 billion.

Q-3 Direct-to-consumer and international revenues increased from $ 0.827 billion to $3.858 billion.

Studio Entertainment revenues rose 33% to $3.8 billion and segment operating income increased 13% to $792 million.

Parks, Experiences and Products revenues rose 7% to $6.6 billion & their segment operating income increased 4% to $1.7 billion.

"The incredible popularity of Disney's brands and franchises positions us well as we launch Disney+, and the addition of original and library content from Fox will only further strengthen our direct-to-consumer offerings," Iger said in the earnings release despite the bumpy quarter. n