Disney Faces Financial Strain with Parks and Series Underperforming

(DailyChive.com) – The Walt Disney Company is still struggling to get back on track financially, and this week, things got worse. A major investment firm downgraded Disney’s stock, pointing out the ongoing problems at its theme parks. Once a big moneymaker, the parks are no longer as reliable as they used to be.

Disney’s stock fell more than 2 percent on Tuesday after Raymond James, a financial services firm, said the company’s theme parks are “under pressure.” The firm noted a “questionable consumer outlook” as fewer people are spending money on vacations and entertainment.

High prices, driven by the policies of the Biden-Harris administration, are causing families to cut back on unnecessary expenses. Vacations, especially expensive ones like Disney trips, are often the first to go. This was confirmed by Disney in their most recent earnings report in August. The company said its “Experiences” division—which includes the parks, cruises, and other entertainment—would likely see less income in the upcoming quarters, thanks to inflation.

Disney’s chief financial officer, Hugh Johnston, explained that lower-income consumers are feeling the pinch the most. With less money to spare, they’re skipping visits to Disney parks. Disney reported that for the last quarter, income from its parks and experiences dropped by 6 percent.

For decades, Disney parks were a top destination for middle- and working-class families. Many saved for years just to afford the trip. But now, with rising costs for essentials like groceries, rent, and healthcare, more families are cutting out luxury vacations. This is a tough blow for Disney.

Adding to Disney’s troubles, the company has been laying off workers. Last week, 300 corporate jobs were cut, affecting areas like legal, human resources, and finance. This follows last year’s cut of 7,000 jobs, as CEO Bob Iger promised to save an additional $2 billion in costs.

On top of that, Disney’s streaming service is struggling. Their latest Star Wars series, The Acolyte, was canceled after just one season, despite its huge $231 million budget. The show was heavily promoted, but failed to connect with fans.

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