In 2019, The Walt Disney Company jumped into the streaming game and launched its very own streaming platform — Disney+. Disney+ was the ultimate streaming spot for fans of not only classic Disney movies and television shows, but also for all things Pixar, Marvel, and Star Wars. In addition to content made by Walt Disney Animation, Disney created a new area of the company to create shows made specifically for Disney+. In just three years, Disney has created many successful shows for Disney+, including The Imagineering Story, Loki, The Mandalorian, and Andor.
However, for all the successful shows that were created for Disney+, there were a number of shows and movies that were not as beloved by subscribers. Recently, Disney revealed that they would be removing many less-successful titles from the platform. This was because it cost more money to keep the programming on the platform than the film or television show brought into the company.
On May 26, the purge began. Shows like The World According to Jeff Goldblum, The Mighty Ducks: Game Changers, Willow, Turner & Hooch, and Marvel’s Runaways were taken down. Disney also removed films like Artemis Fowl, Better Nate Than Never, Cheaper By the Dozen (2022), Stargirl, and Hollywood Stargirl were removed from Disney+.
By removing the more than 30 titles from Disney+, Disney is now able to take a $1.5 billion write-down. Disney will continue to remove content, expecting to write-down another $400 million. That means that, in its accounting book, the show or film is only valued at the difference between the “book value” of the program and how much Disney could make by removing it from Disney+.
Here’s more on Disney’s streaming struggles from The Hollywood Reporter:
Disney’s direct-to-consumer streaming losses have shrunk in recent months, as the company reported $659 million in losses during the second fiscal quarter, down from $1.1 billion reported in the previous quarter. But even as Disney takes on the write-downs related to removing content, McCarthy noted during the earnings call that Disney is expecting streaming losses to widen by $100 million during the current quarter.
Since its launch, Disney CFO Christine McCarthy and now-fired CEO Bob Chapek said that the streamer would not see a profit until 2024. For years, Chapek and McCarthy continued to say that subscriber numbers were increasing and that the streamer was still on track for a 2024 profit. However, it appears that their story may have been a lie.
Recently, a group of shareholders filed a lawsuit against Chapek, McCarthy, and Chapek’s right-hand man, Kareem Daniel. In the lawsuit, the shareholders claim that those three individuals misled investors about the “true costs of the platform.” The lawsuit also claims that Chapek, McCarthy, and Daniel liked about subscriber numbers and subscriber growth.