'The Lone Ranger' could have Disney playing Scrooge
The film's box office collapse likely means more cost cutting lies ahead for a media giant needing to show bottom-line growth.
The film, which stars Johnny Depp and Armie Hammer, cost a reported $250 million to produce and had grossed a mere $71 million as of last weekend, according to Box Office Mojo. It seems likely that the media giant will need to take a write-down because of the film, which may serve as a catalyst for Iger to slash expenses even more.
According to Bloomberg News, in addition to Disney's trimming its workforce and outsourcing noncore operations such as video game development, it's eliminating perks such as car allowances, which in one case amounted to $900 a month.
Even ESPN, which has long been a cash cow for Disney, is cutting back. The "Worldwide Leader in Sports" eliminated as many as 400 positions in May. An additional 120 have lost their jobs at Disney's film studio.
Shares of Disney have risen more than 35% this year, but that's well less than those of rivals such as Viacom (VIA), which climbed more than 52%, and 21st Century Fox (FOXA), which has jumped more than 56%. So Wall Street is especially keen to see Disney bolster its bottom line. The company has long been an investor favorite, known for rarely missing analysts' expectations.
When Disney reports quarterly earnings next month, investors will be keenly interested in the results at Disney's Parks and Resorts business, its second-largest by revenue, because it's viewed as a barometer of the overall economy. Walt Disney World and Disneyland are also among the top destinations for foreign tourists visiting the U.S., which gives the parks an even greater significance.
It will be interesting to see whether Disney's price increases are affecting these businesses. Probably not, given the overall rise in consumer confidence. Indeed, when my family and I visit Disney World later this summer, we expect the place to be packed.
Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
Does anyone agree with me that The Lone Ranger was going to be a bomb for the mere reason that the current youth (saying up to most 30-year-olds) don't know who the Lone Ranger was? The only reason I knew about the character was through my grandparents.
Therefore most youth won't bother seeing the movie because they don't identify with the character such as they would with either Batman or Spider Man. I understand that both Batman and Spider Man have been around for a while but they are just more advertised and well-known.
The prices at Disneyland are absolutely outrageous, and the medium income people cannot afford to take their children, they raise the prices, and cut perks from their employees and outsource what they can, but they still make lots of money.
The movie was a satire, but only the baby boomers would know it. I thought it was funny and enjoyable. Just wait and see when they release the next set of Star Wars movies, money , money, money will flow!!!!!!!!!!!!!!!!!!!!!!!!!
He Mr. Iger! Want to make more money? Don't cut operating costs, CUT THE COST OF GOING TO DISNEYLAND / DISNEY WORLD! There's a concept for you; make the parks more affordable for everyone and more people will go! If you really, really feel the need to squeeze people at the gat, tier the park entry cost based on season/day of the week. How many people go to Disneyland in the middle of the week on October? You could attract TONS of local business if you cut the rate in half during your slower season(s).
Shee**** not rocket science, it's supply and demand!
I do not listen to the so called professional critics about movies, tv shows or anything else for that matter.
I saw this movie and was thourghly entertained by it. I thought this film was every bit a good as any of Depps Pirate of the Carribean movies. I have seen it twice and can't wait for the DVD to be released.
OK, I know it aint Citizen Cain, but it doesnt pretend to be. It's a great way to spend a couple of hours to escape the world and have some laughs. Go see it for your self. and help the mouse.
A wonderful moment in the movie True Lies - Arnold "borrows" a police horse and gives chase to the bad guy. The bad guy uses a motor cycle to make an outragous jump from one high rise to another. Arnold is going to chase right after him, until at the last moment... the horse stops. Even the horse knew it was impossible to do and wasn't ready to die trying.
So when I see a trailer that shows a horse jumping on top of a moving train - then raceing across the top of rail cars... I remember that even a horse would say no.
And honestly, they lost me the first time I saw JD with that bird stuck on top of his head. Again, even a horse would know that was wrong.
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