Disney’s moves give Bob Iger a sporting chance

livemint.com:

Bob Iger has plenty to worry about these days. Nelson Peltz should no longer be one of them. Disney’s fiscal first-quarter results Wednesday afternoon were notable for two reasons that have nothing to do with the actual numbers.

It is the company’s last report before facing two proxy challenges at its annual shareholder meeting in early April, one of which is being backed by Peltz’s Trian activist fund. The report also comes a day after a surprising announcement that Disney will be teaming up with Warner Bros. Discovery and Fox to launch a new streaming service that will combine the three companies’ extensive sports rights into one app, expected to launch this fall.

Disney also announced a new deal with Epic Games on Wednesday to build a new “entertainment universe" based on the blockbuster “Fortnite" game. That deal includes a $1.5 billion investment by Disney for an equity stake in Epic. The seemingly disparate events have a common thread: Disney is facing existential challenges that have hurt its media empire, crushed its earnings and upset shareholders.

The rise of streaming is sinking the once-lucrative cable-TV businesses of Disney and its peers, while the theatrical movie business still hasn’t fully recovered from its pandemic-induced closures. Disney’s pretax margin was 5.4% in its latest fiscal year that ended in September, compared with an average of nearly 25% for the five years before the pandemic. And its stock price had sunk 11% over the 12 months before Wednesday’s report while the Dow and S&P 500 gained 13% and 20%, respectively, in that time.