Posted in: Games, Games Finance, Video Games | Tagged: Comics, disney, entertainment, finance, games, Q3 results, video games

Everything You Need To Know About Disney's Finances In Regards To Games

Disney released their first quarter results recently which does not reflect the sort of hellish growth you'd expect of a corporate juggernaut. Disney, unlike many publicly traded institutions ends their financial year in October, so December 31st was the end of their first quarter. Weird, huh? That does mean that their year has just started, so the numbers here are not quite as high as you'd probably expect.

Yes this post does have a clunky title, but it's the basis of this post and I can't be bothered to be witty about finance right now. So accurate title is accurate.

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While their numbers are not the best, they aren't the worst we've seen and consumer products and interactive media ranks the lowest of Disney's revenues, trailing behind media outlets, parks and services, and studio entertainment. The revenues for consumer products and interactive media decreased 23% to $1.5 billion and segment operating income decreased 25% to $642 million. Disney cited decreases in merchandise licensing, games, retail businesses, and currency differences for the overall loss.

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Essentially, Disney couldn't sell as many Frozen and Star Wars items and games as they had back in the first quarter of 2016 because Frozen is old news and Rogue One isn't the sort of movie to move a lot of kids toys out of stores. Moana merchandise was credited as a boost to the sales, but could not overcome the loss of Frozen and Star Wars properties.

Which is slightly bad news for Marvel fans who want to play as their favorite comic book heroes and villains because it means the profits from their games are going to bolster a failing sector of the company rather than helping further Disney's game efforts. It also means that Disney focuses far too much of their game strategy on currently popular titles related to their feature films. Games are a derivative business for Disney, not their primary focus. It is unlikely Disney will simply write off games as a loss, but this is still bad news. However, Disney has 9 months until the end of their fiscal year, so we'll see how things shape up at the end of March.

That said, Disney has quite a few projects coming up in 2017 that will very likely help boost those consumer product and interactive media sales. Lets hope the latest Marvel vs. Capcom sells.

You can check out the full report here. You can also check out my previous posts on all things games finance here, here, and also here.

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