Disney's Profits Plummet 30% in Disappointing Second Quarter
Disney's quarterly profits suffered a dismal 30% drop, according to the company's recent announcement. The entertainment conglomerate's second-quarter net profits came in at $269 million, excluding last year's purchase of a stake in Infoseek. Meanwhile, sales increased by 5% to $5.5 billion. The disappointing results were largely attributed to the underperformance of 1999 video releases, including Mulan and The Rescuers, as well as increased costs at the company's ABC television network.
Key Takeaways:
- Disney's second-quarter net profits declined by 30% compared to the previous year, reaching $269 million.
- Sales increased by 5% to $5.5 billion in the same period.
- The main reasons for the profits decline were the underperformance of 1999 video releases, such as Mulan and The Rescuers, and increased costs at ABC.
- Michael Eisner, Disney's chairman and CEO, described the results as "disappointing".
- Eisner is one of the key players in the ongoing court case against Jeffrey Katzenberg, who is claiming he is owed 2% of Disney's profits from his ten-year tenure.
- Katzenberg's legal team is accusing Eisner and Disney of conspiracy to deny Katzenberg his bonus after he left the company in 1994.
- Disney denies any deceit, admitting only that Katzenberg is owed some money.
Statistics:
- Second-quarter net profits: $269 million (down 30% from the previous year)
- Sales: $5.5 billion (up 5% from the previous year)
- Costs at ABC: increased (exact figures not specified)
- Video releases: Mulan and The Rescuers underperformed in 1999 (exact figures not specified)
Sources:
"The Times", 1999