Revenue: $25.4 billion
Profits: $920 million
The Mouse House is cutting back both the number of pics it will produce each year and the average cost of each, as Disney seeks to stabilize profitability throughout its diverse entertainment operations.
Over recent reporting periods, Mouse has managed to demonstrate decent traction for efforts to turn around its long-ailing consumer products unit. Conglom has closed underperforming stores and refocused changed product lines to emphasize the most profitable branded properties.
But the merchandizing makeover involves ops repping only a modest fraction of conglom’s corporate empire. Broadcasting is the big bugaboo.
And if the Mouse has any hope of restoring its once-lustrous profile on Wall Street, the conglom has to roll up its sleeves for some heavy lifting, analysts say. ABC is its biggest ulcer, as the Alphabet’s creative stagnation coincides with a growing perception that ratings domination by broadcast webs may be over.
While the fortunes of cable webs such as Disney’s sportscasting powerhouse ESPN have also ebbed during the recent industrywide ad slump, an eventual recovery is considered only a matter of time. And the remake of basic cable’s Fox Family Channel into ABC Family is proceeding apace.
“(Primetime) does present a problem, and we are determined to solve it,” head Mouseketeer Michael Eisner told shareholders in conglom’s annual report.
The other big underperformer in fiscal 2001 was theme parks, largely because the fiscal year’s last three months took a sucker punch from the Sept. 11 attacks.