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The Walt Disney Company continues to struggle financially, according to a new report out of Breitbart News.
This week, a prominent firm downgraded its stock due to issues at its theme parks, once a reliable revenue source. Following Raymond James’s downgrade, Disney shares fell over 2% on Tuesday. Analysts cited “pressure” on the parks and a “questionable consumer outlook” as demand slows. This reflects broader concerns about Disney’s financial recovery.
Households facing record-high consumer prices under the Biden-Harris administration are cutting back on non-essential spending, such as expensive vacations. Disney confirmed this trend in its August quarterly earnings report, where executives attributed a projected decline in income for its “Experiences” division—which includes theme parks, cruise ships, and live entertainment—mainly to inflation. The company expects lower earnings in the coming quarters as consumers prioritize essential spending over luxury experiences.
Disney’s Chief Financial Officer, Hugh Johnston, highlighted that the current economy is particularly impacting lower-income consumers, leading to fewer visits to Disney parks. In the latest quarter, Disney’s “Experiences” division, which includes its parks, saw a 6% drop in operating income.
Historically, Disney parks have relied on middle- and working-class families, who often save for years to afford the trip. However, under the Biden-Harris administration, rising consumer prices have forced families to cut back on non-essential spending to cover essentials like groceries, rent, and insurance.
Disney’s recent challenges continue, as the company recently laid off an estimated 300 U.S.-based corporate employees across several divisions, including legal, human resources, finance, and communications. This follows the elimination of 7,000 jobs worldwide last year as part of CEO Bob Iger’s strategy to achieve $2 billion in cost savings. These layoffs are another blow to the company amid financial struggles, particularly in its theme park division, as Disney faces rising costs and declining consumer spending.
‘THE ACOLYTE’ has been cancelled by Disney+ after 1 season. pic.twitter.com/9F9NKx7BE4
— DiscussingFilm (@DiscussingFilm) August 19, 2024
Disney is also facing setbacks with its streaming content, as its latest Star Wars series, The Acolyte, was canceled after just one season despite heavy promotion and a reported budget of $231 million. The feminist-themed series featured a coven of lesbian witches and included a transgender actor in a prominent role. Despite its ambitious production, the show struggled to gain traction. The creator of The Acolyte had previously made headlines by stating that fans who engage in “bigotry, racism, or hate speech” are not true Star Wars fans, sparking further controversy.
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