Entertainment
Disney's streaming business (sans ESPN+) turns a quarterly profit
Walt Disney Co. is making massive strides toward making its streaming business profitable, a milestone that comes none too soon as its traditional TV networks continue to decline.
The Burbank media and entertainment giant reported overall streaming business revenue of $6.19 billion for the second fiscal quarter of 2024, up 12% compared with a year earlier. Disney’s streaming business — which includes Disney+, Hulu and ESPN+ — reported an operating loss of $18 million for the three-month period that ended March 30, a 97% change from last year, when it reported losing $659 million.
The company’s “entertainment streaming” business, which consists only of Disney+ and Hulu (and not ESPN+), was profitable during the quarter, notching operating income of $47 million, compared with a loss of $587 million a year earlier. Excluding ESPN+, streaming revenue of $5.64 billion was up 13% from a year earlier.
Overall, Disney generated $22.1 billion in revenue that quarter, up 1% from the same period a year earlier. Sales came in roughly in line with analysts’ estimates, according to FactSet. Earnings, excluding certain items, were $1.21 per share, up from 93 cents a year earlier and better than the $1.10 that analysts had predicted, on average.
Disney Chief Executive Bob Iger noted the growth in streaming in a statement, saying that the business, in addition to the company’s continued strength in experiences, which includes the parks, drove the company’s second-quarter performance.
Disney’s investment in streaming, which accelerated to grow the Disney+ service that launched in 2019, has lost billions of dollars to date. The company expects its combined streaming operations to finally turn a profit in the fiscal fourth quarter of 2024.
This marks Disney’s first quarterly earnings report since Iger trounced activist investor Nelson Peltz in a proxy fight, in which Peltz had sought a board seat. Investors, in a vote tallied at Disney’s annual shareholder meeting in April, decisively rejected Peltz’s bid.
Peltz, among other things, had demanded that Disney show a realistic plan for Netflix-like profit margins in the costly streaming business. To get Disney closer to its profitability goals, Iger waged a severe cost-cutting plan, eliminating more than 8,000 jobs.
“Looking at our company as a whole, it’s clear that the turnaround and growth initiatives we set in motion last year have continued to yield positive results,” Iger said in a statement.
Although Disney’s streaming business was a bright spot for its entertainment segment, the company’s linear TV business struggled in the quarter, reporting $2.77 billion in revenue, a decrease of 8% compared with a year earlier. The linear networks reported operating income of $752 million, down about 22% from the same period last year.
The company said its losses in linear networks stemmed from lower affiliate revenue because of a decrease in subscribers after Spectrum dropped eight networks, including Freeform and Disney Junior, from its lineup as part of Disney’s new cable licensing agreement with cable giant Charter Communications. Those negotiations resulted in a more-than-10-day blackout of ESPN and ABC channels as the two companies hashed out an agreement.
The company’s film studio business also struggled, with revenue falling 40% to $1.39 billion for an operating loss of $18 million. Disney posted weak box-office results compared with last year’s second quarter, when it had Marvel’s “Ant-Man and the Wasp: Quantumania” and “Avatar: The Way of Water.”
Disney movies have had a weak run in 2024 and the company is hoping for a rebound with “Kingdom of the Planet of the Apes,” “Inside Out 2” and “Deadpool & Wolverine.”
Disney’s sports sector reported revenue of $4.31 billion, up 2% compared with a year earlier. ESPN operating income was $778 million, down 2% from the year-earlier period.
Meanwhile, its “experiences” division — which encompasses theme parks such as Disneyland and Walt Disney World; cruise lines and consumer products — continued to drive profit for the company with $8.39 billion in revenue, an increase of 10% from a year earlier. Operating income from the parks division was $2.29 billion, up 12%. The segment accounted for 59% of the company’s operating income.
The growth in experiences came from higher results at Walt Disney World in Florida and Disney Cruise Line, the company said.
Additionally, Disney took a $2-billion write-down of its troubled Star India business after agreeing to merge the operations into a joint venture controlled by rival Reliance Industries, a major Indian conglomerate. The Star India business, along with its HotStar streaming service, became part of Disney through its 2019 acquisition of 21st Century Fox.
Entertainment
Spotify doubles down on video podcasts at its Hollywood studios
On a recent weekday morning inside a studio in the heart of Hollywood, Rachel Lindsay and Van Lathan, co-hosts of The Ringer’s “Higher Learning,” were getting ready to roll.
By the time the podcasters came into the Spotify Sycamore Studios for their show, which covers all things in Black culture and politics, the overhead lights were set, and the cameras were precisely angled. Decorative books were propped up between their seats and a big red “Higher Learning” logo stood behind them.
As soon as everyone silenced their phones, the hosts began to banter like two old friends. Lindsay complimented Lathan on his recent foray into stand-up comedy at the Netflix is Joke Fest at the Laugh Factory.
“I just have to say … basically a star is born,” said Lindsay, grinning. “I have to talk about it. Now I never doubted you.”
The pair helms one of the many shows on The Ringer podcast network, known for its roster of A-list celebrity hosts and sports and culture commentators that recently moved into Spotify’s newest podcasting studios.
The 11,000 square-foot space on Sycamore Avenue was designed as both a home base for The Ringer’s production and a video podcasting hub for select Spotify creators.
Since its opening earlier this year, the space has welcomed more than 25 podcasters and shows, on top of the dozens of shows that still record at Spotify’s Mateo studios in the Arts District.
The company estimates that over the last five years it has contributed more than $10 billion to the podcasting industry, including payouts to creators and investments in new content.
Podcasts are just one arm of Spotify’s business, as the audio giant has over 100 million songs and 700,000 audiobooks on its platform. But video podcasts have become an increasingly important way for the company to keep listeners tuned in — and paying for subscriptions amid growing competition from Apple Music and YouTube Music. Despite a surge in profits in the first quarter, Spotify’s share price has fallen 25% this year as investors worry about a slowdown in subscriber growth.
Van Lathan and Rachel Lindsay record their podcast, “Higher Learning with Van Lathan and Rachel Lindsay,” at Spotify’s Sycamore Studios in Hollywood on May 7. The podcast is distributed on Spotify through The Ringer.
(Allen J. Schaben/Los Angeles Times)
One of the main drivers behind opening the Sycamore studios was to create a central hub for The Ringer, a media company Spotify acquired for $250 million in 2020.
Geoff Chow, Spotify‘s head of podcast studios and The Ringer’s managing director, said the investment is already paying off “in terms of the productivity and the quality of the content we’re able to produce from here.”
The Ringer is one of the streamer’s most popular assets. Spotify includes nine Ringer shows in its list of the top U.S. podcasts.
“They’re pouring into this space and their creators,” Lathan said, before recording a new “Higher Learning” episode. “We really have the freedom to do so much.”
He and Lindsay said the studio has elevated their show by switching up their workflow and increasing in-person work.
Thanks in part to its centralized location, tucked between the offices of SiriusXM and music and sports entertainment company Roc Nation, they say guests are more eager to visit and record in person. Lathan joked that even while walking down the street, he’ll run into radio personalities like Sway Calloway, who hosts his own successful “Sway in the Morning” show on SiriusXM, and convince them to come up for a tour of the space.
Sycamore has already seen guest appearances from Snoop Dogg on “Game Over with Max Kellerman and Rich Paul,” Pennsylvania Gov. Josh Shapiro on “Higher Learning with Van Lathan and Rachel Lindsay” and “Project Hail Mary” author Andy Weir on “House of R.”
“This street is so cool,” Lindsay added. “It’s just a different energy here.”
The duo first started recording at Spotify’s Arts District campus, which is more focused on audio-driven programs. But as the podcasting landscape evolves and video becomes a more important element, “Higher Learning” is now able to maximize on the new studio’s video-first capabilities.
Chris Thomas, studio operator, works in the control room on the podcast, “Higher Learning with Van Lathan and Rachel Lindsay.”
(Allen J. Schaben/Los Angeles Times)
Spotify also employs a combination of full-time employees and freelancers that staff each show, including sound engineers, lighting specialists and set designers who help keep the place running.
The Ringer, founded by media mogul Bill Simmons, exists online as a website, a podcast network and video production house, anchored in sports, pop culture and politics coverage. Some of its most popular programs include “The Bill Simmons Podcast,” “The Rewatchables” and the inaugural Golden Globe winner “Good Hang with Amy Poehler.”
Many of the hosts overlap within The Ringer’s podcasting ecosystem. Just between Lathan and Lindsay, they host and appear as regular guests on as many as five shows, so they work from the studio three to five times a week. By being in close quarters together, a greater sense of collaboration has enveloped The Ringer’s team. Chow said there are some days when Simmons will walk onto four shows a day, just to share his thoughts on a topic.
“This is my dream of what The Ringer is. We’re all here talking, we’re all existing together,” Lathan said. “We’re all popping in and out of different rooms all the time.”
Exterior view of the building that houses Spotify’s new Sycamore Studios. The company takes up one floor of the facility.
(Allen J. Schaben/Los Angeles Times)
The Ringer was first founded in 2016. At the time, Simmons had recently been ousted from ESPN due to a strained relationship with higher-ups. Simmons had spearheaded the network’s Grantland sports blog, which focused on cultural commentary that is similar to what The Ringer does today. The Ringer soon established itself as one of the fastest-growing independent podcast networks.
The brand still keeps its roots in fandom — whether it’s through football or “Game of Thrones,” said Chow. So, to have a space that reflects the diversity of its programming often makes recording more fruitful, especially during key moments like the NFL draft or awards season.
As The Ringer continues to expand its roots in Hollywood, the network remains focused on maximizing its content.
In January, The Ringer started airing select podcasts on Netflix to reach a wider audience. Chow said the partnership is off to a promising start. Each of the five recording studios at the Sycamore site is fully equipped with live-streaming technology — making the weekly Netflix live shows possible.
“Podcasts have become like a cultural hub and curator of things that are happening in the world,” Chow said. “We always want to innovate and test. That’s something that was exciting to us to think about bringing our audience new content in different places.”
Movie Reviews
Jordan Firstman’s ‘Club Kid’ Sparks Eight-Figure Offers: Cannes
Jordan Firstman‘s buzzy Cannes UCR title Club Kid has been the talk of the festival and market this past 24 hours.
Multiple suitors are in for the movie and what’s interesting is the size of those suitors. Multiple major studios have kicked the tyres on the project. Contrary to reports, the offers are already in the eight-figure range. They were there last night, we heard at the time.
Many have assumed this will be an A24 title come the final reckoning but there is strong competition for a movie one studio buyer just told me at an event is “the most commercial movie at the festival by far: it works on a number of different levels to different age groups”. Another festival regular I spoke to said they see it as an awards movie “for sure”. The domestic credentials are certainly strong. Some international buyers we’ve spoken to were a little cooler but ultimately who doesn’t want a heartfelt good-vibe movie.
UTA Independent Film Group is in the middle of the deal. Charades handles international.
Club Kid follows a washed-up party promoter who is forced to turn his life around when an unexpected visitor arrives. Reviews have been strong.
During the film’s seven-minute Cannes ovation yesterday, lead actress Cara Delevingne teared up. Firstman, who also wrote and stars, picked up costar Reggie Absolom (who plays the son of Firstman’s character in the film) and started a chant in his honor. It was a continuation of the hijinks the two got up to at the film’s photocall earlier in the day.
There are multiple projects in the market also drawing good offers. Things should become clearer in next 48 hours.
Entertainment
2026 TV upfronts recap: Hi-tech ad buying, creator fever and ‘Baywatch’
The television industry has changed dramatically over the last decade, but one tradition that won’t die is the annual gathering of ad-buying execs in Manhattan to hear the pitches of networks and streamers looking to sell their commercial time.
This past week’s lavish presentations, known as the upfronts, included the usual array of big-name actors (Arnold Schwarzenegger and Jennifer Lopez), NFL legends (Tom Brady and Mike Tomlin) and “Real Housewives,” past and present.
Jennifer Lopez and Brett Goldstein speak onstage during the 2026 Netflix Upfront at Sunset Pier 94 Studios on May 13.
(Dimitrios Kambouris/Getty Images for Netflix)
The selling buzzwords are far different from the days when the presentations were a vehicle for networks to boast about their ratings and present new program line-ups. The 2026 upfronts talked a lot about “connections” and “community” as the personalized nature of TV viewing brought on by streaming video-on-demand has been fully integrated into the buying and selling of commercials.
“Three of us could be watching the same show, maybe at a different time, maybe at the same time, but receive very different advertising based on what ad technologies, know about us as an audience segment,” said Josh Mattison, executive vice president of digital revenue pricing, planning and operations for Walt Disney Co. “The old model would be, hey, did 10 million people watch this ad? I think the new model is, which 10 million people watch this ad.”
Here’s a sampling of what ad executives were seeing and hearing this week:
Using new ad tools that target viewers
Every company presentation touted advancements in the ability to target consumers now that advertising has become the main source of revenue growth in the streaming business. They also played up new services — such as NBC’s Performance Insights Hub — providing advertisers with up to date information on the effectiveness of their advertising so they can adjust accordingly.
Streamers can take the consumer research collected by advertisers and align them with the viewing habits of their subscribers. The data are analyzed in a secure room to protect consumer privacy.
Netflix doesn’t ask subscribers for personal information in the sign-up process, as it can discourage people from buying the service. But the company does use the viewer habits on the platform to help advertisers reach the customers they seek.
“We are seeing where there is overlap and use that to help our advertisers target better,” Amy Reinhard, president of advertising for Netflix, told The Times. “It’s all based on viewer preferences.”
Every company is turning to AI to respond to the needs of advertisers. NBC now offers them the chance to insert commercials that relate to the action seen on the screen during live sports events.
Creators are going mainstream
YouTube’s annual upfront gatherings used to have the feel of an alternative show business universe, with personalities who built their rabid followings on the streaming platform far away from the audiences for traditional TV.
Now creators such as the sports stunt group Dude Perfect have their own studios. Beast Industries, the corporate home of MrBeast, held its own invitation-only breakfast for marketing executives at a high-end New York venue . YouTube stars, such as Jesser, are landing shows on other platforms.
At YouTube’s presentation at Lincoln Center, longtime favorites such as “Call Her Daddy” podcast mogul Alex Cooper and “SubwayTakes” host Kareem Rhama appeared on stage to announce new projects on the platform, looking more like established show producers rather than social media renegades.
Ten years ago, YouTube advertisers had to worry about their spots running next to Islamic State videos. Now it’s become common for marketers to embrace YouTube stars and fully integrate products and messages into their programs.
“When creators talk about your products on YouTube, viewers are 13 times more likely to search for your brands and five times more likely to buy,” said Paul Downey, president of Americas & Global Partners for YouTube.
Mary Ellen Coe, chief business officer for YouTube, told The Times that advertisers can determine if a creator is right for their brand by looking at audience numbers, subscriber data and comments from their communities of fans. But many have their own personal focus groups at home that introduce the hottest YouTube personalities.
“Most of these advertisers have children and teenagers and they go nuts for them,” Coe said.
YouTube is the most watched TV platform according to Nielsen, accounting for nearly 13% of all TV viewing. But that share is much higher among younger consumers.
“My kids don’t watch TV — they watch YouTube,” said Anthony Pedalino, vice president and head of media investment at the ad buying firm Giant Spoon. “So I think this is a bit of future proofing.”
Other companies are seeking creators for their platform.
Amazon Prime Video introduced an alternative feed of some of its NBA games on its streaming platform Twitch, which will turn them into a “CreatorCast.” The streamers who are regulars on the site call the action live in an effort to bring in younger fans. The format will be used in WNBA games in the league’s new season.
Fox touted its creator initiative that develops programs for Tubi, the company’s fast-growing ad-supported streaming platform that now has 100 million active users. The company also has a partnership with TikTok to support creators who want to turn their short-form clips into full-length programs.
There’s always room for comfort food
Amid all the innovations in ad buying and audience measurement presented during the week, many of the programs and personalities offered up by the major networks and streamers were extremely familiar.
“They may be resigned to the fact that people are going to go to emerging platforms for more niche and esoteric programs,” Pedalino said.
Oprah Winfrey made an entrance on the Beacon Theatre stage to promote the move of her podcasts to Amazon Prime Video.
Disney rolled out the cast of “Scrubs” to announce another 10-episode order of the early 2000s sitcom for Hulu. The series had a successful reboot as Gen Z viewers continue to devour vintage programs. Amazon Prime announced “The Greatest,” a Michael B. Jordan-produced mini-series on legendary heavyweight fighter Muhammad Ali, not exactly uncharted territory.
Fox introduced a reboot of “Baywatch,” which was canceled after a single season on NBC in 1990, but went on to become a worldwide hit in syndication over the decade that followed. The slow-motion shots of toned lifeguard bodies running into Venice beach waters are coming back without a hint of irony.
Netflix brought out the set of “Pop Culture Jeopardy” at its presentation at Sunset Pier 94 Studios, NBC previewed comedies with proven prime time stars and touted its 100th anniversary which will be celebrated with an old-fashioned variety special later this year.
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