Disney's 1st-Qtr Earnings Prove to Be a Mixed Bag

The transcript discusses Disney's financial challenges due to ESPN's decline, including subscriber losses and increased NBA rights fees. Despite this, investor reactions have been muted, possibly due to Disney's prior communication about these issues. Disney is addressing the decline by investing in online platforms and lower-cost TV packages. Additionally, Disney's theme parks and film business, bolstered by acquisitions like Pixar and Marvel, are helping offset ESPN's financial impact.

What was the primary reason for the drop in Disney's operating income?

• Higher production costs for Disney movies

• Increased competition from other networks

• Subscriber losses and increased NBA rights fees at ESPN

• Decline in theme park attendance

How has Disney been preparing investors for ESPN's challenges?

• By launching new theme parks

• By increasing ticket prices at theme parks

• By telegraphing potential issues for over a year

• By reducing the number of ESPN channels

What significant step is Disney taking to address ESPN's decline?

• Launching an online version of ESPN

• Merging ESPN with another network

• Closing down ESPN channels

• Reducing ESPN's content offerings

Which two areas is Disney focusing on to compensate for ESPN's decline?

• Retail stores and merchandise

• Theme parks and cruise ships

• Television and radio broadcasting

• Sports sponsorships and endorsements

What acquisitions have contributed to the success of Disney's film business?

• DreamWorks and Universal Studios

• Pixar, Marvel, and Lucasfilms

• Warner Bros and Paramount Pictures

• Sony Pictures and 20th Century Fox