Disney expects to cut billions of dollars from its content budget in fiscal 2024.
Speaking on the company’s earnings call, Disney’s interim CFO Kevin Lansberry said that next year the company expects to spend $25 billion on content, down from $27 billion from fiscal 2023.
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The company was initially targeting content spend in the low $30 billion range this year, but the Writers Guild of America and SAG-AFTRA strikes have impacted that spend, as did Iger’s new content strategy. Lansberry added that the company is now targeting an “annualized entertainment cash content spend reduction target” of $4.5 billion, excluding the impact from the strikes. He added that it will “take a few years for the bulk of the savings to be reflected in the P&L due to the timing of amortization.”
Lansberry also notes that some 40 percent of Disney’s content spend is on sports and sports content, meaning that the company is spending $10 billion on sports, and about $15 billion on entertainment next year.
The cost of content has become a hot-button issue for all entertainment companies as they seek profitability in streaming, and with the strikes reducing output and likely raising some expenses.
Netflix, for example, said it expects to spend $13 billion on content this year, down from the expected $17 billion, due to the strikes. It expects content spend to be back closer to the $17 billion figure. Other companies, including Warner Bros. Discovery and Paramount, have also cut back somewhat on content spend.
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