Amid Comcast Corp’s CMCSA impending cable networks spinoff, Walt Disney Co. DIS CEO Robert A. Iger has ruled out the need for further mergers and acquisitions.
What Happened: On Thursday, during Disney’s fourth-quarter earnings call, UBS analyst John Hodulik asked Iger about the potential for Disney to make similar moves.
In response, Iger pointed to Disney’s successful acquisition of assets from 20th Century Fox in 2017, driven by the rise of streaming. This strategic move has led to approximately 174 million global subscribers for Disney.
“We, in many respects, have already consolidated. We don’t really need more assets right now, either from a distribution or from a content perspective to thrive in basically a disruptive media world,” Iger said.
Disney’s senior executive vice president and CFO, Hugh Johnston, also rejected the idea of divestitures, stating that he did not see a value-creating opportunity for Disney in this regard.
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Why It Matters: Disney’s fourth-quarter earnings were boosted by streaming gains, strong box office performance, and solid park performance. The company reported a 6% YoY revenue growth to $22.57 billion, marginally beating the analyst consensus of $22.35 billion.
Comcast is exploring a spinoff of its NBCU Cable Networks into a new company. This move was announced by Comcast president Mike Cavanagh at the company’s third-quarter earnings.
Comcast reported a revenue decline of 6.5% YoY to $32.07 billion at the time, beating the analyst consensus estimate of $31.64 billion.
Price Action: Disney shares closed Thursday's session with a 6.23% gain, finishing at $109.12. However, in after-hours trading, the stock saw a slight dip, settling at $108.50 as of the latest update.
In contrast, Comcast shares declined by 0.98% in Thursday’s session, closing at $43.48, according to data from Benzinga Pro.
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