Disney Cuts One-Tenth of First-quarter Net Profit in the aftermath of COVID19

Global entertainment group Walt Disney Co. saw its net profit plunge to one-tenth of last year’s level in the first quarter of this year in the wake of the new coronavirus infection (COVID19).

According to CNBC and Bloomberg News, Walt Disney announced on the 5th (local time) that its net profit in the first quarter of this year was $475 million (581.6 billion won), down 91% from $5.431 billion in the same period last year.

Walt Disney estimated losses from COVID19 amounted to $1.4 billion, or 1.713 trillion won.

In fact, in the wake of the shutdown of the theme park from the end of January, the first-quarter operating profit of the “nori, experience and souvenirs” sector was $639 million, down 58 percent from the same period last year.

In addition, operating profit in the “Studio Entertainment” sector fell 8 percent to $466 million from mid-March due to limited movie releases.

However, its first-quarter sales rose 21 percent to $18.09 billion (22.466 trillion won). This was largely influenced by Fox’s acquisition of the entertainment business in the 21st century.

Sales in the “overseas and customer-facing” sector also rose to $4.1 billion from $1.1 billion a year earlier, thanks to the strides made by online streaming service Disney Plus, which attracted 54.5 million subscribers from November last year to April 4.

Bob Chippec, CEO of Disney, also announced plans to reopen Disneyland Park in Shanghai, China, on the same day, saying, “Many businesses are financially affected by COVID19, but we are confident that we are capable of enduring confusion.”

Shanghai Disneyland, which was closed on Jan. 25, is scheduled to reopen on June 11.

It is the first Disney theme park to be reopened as COVID19.