Disney CEO Bob Iger says company is looking to cut costs by $7.5 billion
Disney upped its cost-cutting goal by $2 billion
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Disney CEO Bob Iger is looking to further trim costs at the entertainment giant.
He and the company said Wednesday afternoon that it has "increased our annualized efficiency target to $7.5 billion" while continuing to "aggressively manage" its cost base.
Disney had said in February it wanted to save $5.5 billion across the company. With the new cost-reduction goal, that means $2 billion more in costs will get trimmed.
Disney Executive Chairman Bob Iger attends the Exclusive 100-Minute Sneak Peek of Peter Jackson's The Beatles: Get Back at El Capitan Theatre on November 18, 2021 in Hollywood, California. (Charley Gallay/Getty Images for Disney / Getty Images)
The entertainment giant announced the new cost-savings target while disclosing its fourth-quarter results in the late afternoon.
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Disney is "on track" to achieve the new savings, Iger said during the earnings call.
He added that the "thorough restructuring" it has been engaged in "has enabled tremendous efficiency." Earlier in the year, the company moved to have just entertainment, sports and experiences segments and slashed thousands from its headcount, among other measures.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DIS | THE WALT DISNEY CO. | 115.33 | +1.06 | +0.93% |
Disney said Wednesday its fourth-quarter revenue came in at $21.24 billion and its net income hit $246 million. Those figures represented 5.4% and 62.9% increases year-over-year, respectively.
Walt Disney Studios in Burbank, California, US, on Thursday, Feb. 9, 2023. Walt Disney Co. Chief Executive Officer Bob Iger announced plans for a dramatic restructuring of the worlds largest entertainment company that includes cutting 7,000 jobs and (Eric Thayer/Bloomberg via Getty Images / Getty Images)
In the entertainment segment, the company saw overall quarterly revenues lift 2%, posting $9.5 billion.
The sports segment where ESPN falls brought in $3.91 billion, according to Disney.
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Its direct-to-consumer streaming services — Disney+, Disney+ Hotstar and Hulu in entertainment and ESPN+ in sports — collectively produced $5.55 billion in revenues in the fourth quarter while their operating loss became $387 million, shrinking an eye-popping amount.
Walt Disney Co
"We remain confident we will achieve profitability in Q4 of fiscal 2024," Iger said of Disney’s direct-to-consumer services.
The company reported the revenues of its experiences segment were $8.16 billion. That marked a 13% boost from the $7.25 billion it posted in the same three-month period the prior year
Fireworks explode over guest watching from work showcase during the Flower and Garden Festival at Epcot at Walt Disney World in Orange County, Florida on May 30, 2022. Walt Disney World is celebrating its 50th anniversary all of 2022. (Joseph Prezioso/Anadolu Agency via Getty Images / Getty Images)
"Our results this quarter are a testament to the work we’ve done across the company this past year," Iger said on the call. "And I’m bullish about the opportunities we have to create lasting growth and shareholder value and to strengthen Disney’s position as the world’s leading entertainment company."
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Disney’s value in terms of market capitalization was $154.62 billion as of Wednesday afternoon.
Iger has been back as CEO at the entertainment giant for nearly a year. In July, the company upped the length of his contract, making it run two years longer until the end of 2026.