The troubles for Disney are getting deeper and deeper as the company faces a sharp decline in profits in the fiscal year. The sports division of Disney is the major contributing force to the company’s decline. It has been found that Disney’s sports division has reported a 20 percent drop in profits in the first 9 months of the year. This accounts for the company’s ESPN network and Star Sports Network in India.
The biggest reason behind this drop in profits is believed to be the operating loss incurred by Star Sports Network in India. With rising competition from competitors like Sony and Viacom18, Star has found it difficult to hold its ground in the arena which it once dominated.
Operating income for the sports branch of the company has dropped to $1.48 billion while its revenue stands at $13.2 billion. One of the biggest reasons behind this drop in growth is believed to be viewers’ shift from traditional cable channels to streaming services. While there has been a decrease in viewership at the conventional cable networks, digital streaming for sports is gaining more and more popularity.
ESPN is planning to provide streaming services in order to retain its traditional viewer base. It was also forced to lay off 20 on-air employees in order to reduce operating costs.
