Walt Disney to See $1.5 Billion Charge in 3Q After Cutting Streaming Content

By Denny Jacob

Walt Disney Co. on Friday said it will record a $1.5 billion impairment charge in the current quarter after removing certain content from its direct-to-consumer services.

The entertainment giant's content review of its DTC segment, which includes its streaming services such as Disney+ and Hulu, is part of a strategic change in how it curates content. The company said it removed certain produced content from its segment on May 26 and will record the charge to adjust the carry value of these content assets to fair value, according to a regulatory filing.

Disney said it is continuing its review and expects additional produced content will be removed from its DTC and other platforms, largely during the remainder of the fiscal third quarter, which ends June 30. It may incur further charges up to $400 million related to produced content, the company said.

The future of Disney's streaming services has come into focus in recent weeks. The Wall Street Journal reported that Disney's ESPN is laying the groundwork to sell its channel directly to cable cord-cutters as a subscription streaming service in the coming years. The Journal also reported that Disney is in talks to buy out competitor Comcast's minority stake in Hulu.

Write to Denny Jacob at [e-mail]

(END) Dow Jones Newswires

June 02, 2023 16:59 ET (20:59 GMT)

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