“The Simpsons” L-R: Bart, Homer, Maggie, Marge and Lisa.
FOX | FOX Image Collection | Getty Images
Disney is warning investors and analysts that the Fox deal it closed in March will continue to impact earnings.
CFO Christine McCarthy said Tuesday the company expects the acquisition will lower its fourth-quarter profit, before purchase accounting, by about 45 cents per share. However, Disney remains optimistic about the benefits of acquiring the entertainment giant.
With the studio came titles such as “The Simpsons” and X-Men, which allows Disney to better compete with streaming services such as Amazon and Netflix for viewership and dollars.
Disney is set to release its own streaming service, Disney+, in November. Along with its own library of content, Disney now has all of Fox’s entertainment assets.
“As I said a few times, we analyze the 21st Century Fox opportunity entirely through the lens of our future business,” CEO Bob Iger said on an earnings call Tuesday.
The company has already said all episodes of “The Simpsons” will appear on the services on day one. Other 20th Century Fox titles on Disney+ will include “The Sound of Music,” “The Princess Bride” and “Malcolm in the Middle.”
“We’re also focused on leveraging Fox’s vast library of great titles to further enrich the content mix on our DTC platforms,” Iger said. “For example, reimagining ‘Home Alone,’ ‘Night at the Museum,’ ‘Cheaper by the Dozen’ and ‘Diary of a Wimpy Kid.'”
And, now that Disney owns Hulu, it can put its not-so-family-friendly fare on that streaming service alongside “The Handmaid’s Tale,” “The Act” and “Catch 22.”
“Our play … is to have general entertainment, we’ll call it Hulu, more family-like entertainment, which is Disney+, and sports,” Iger said. “And that bundle that we’re creating, that $12.99 bundle where you can buy all three, offers consumers tremendous volume, tremendous quality and tremendous variety — for a good price. “
Disney shares tumbled in extended trading Tuesday after the company fell short of analyst estimates. It blamed the earnings miss on the $71 billion deal, and the cost of integrating the Fox entertainment assets.
Alan Horn and Alan Bergman will oversee the integration of 21st Century Fox’s film strategy under the Walt Disney umbrella. The pair are veterans at Disney and have been responsible for much of the success with the Pixar, Marvel and Lucasfilm acquisitions.
While Disney blamed Fox’s “Dark Phoenix” for dragging on the company’s massive box office haul during the third quarter, it will now have complete creative control over future films.
Disney is already ruling the 2019 box office, having earned more than $8 billion globally from ticket sales so far. Analysts are keen to see what the company does with Fox’s assets, particularly the four “Avatar” sequels currently in production.
“They’re taking the Fox Studio in a new direction, all new development slates will focus on a select group of high quality movies for theatrical release as well as for our Hulu and Disney+ platforms and Fox Searchlight will continue to make prestige films it’s known for while expanding its high quality original story telling into the direct-to-consumer space,” Iger said.
