Question

How has/will the covid-19 situation impact Disney's 4 business segments (1. studio entertainment, 2. media networks, 3. direct-to-consumer and international, and 4. parks, experience and products). Explain the impact on revenues, expenses and asset values for the four segments.

Answer 1

Disney has a wide presence of its business portfolio in studio Business, media business networking, amusement parks and direct to consumer business. With the emergence of covid-19 Disney was first among various businesses to get infected as it has a wide presence in Chinese domain and its business was shut there so the revenues started to shrink in the early of 2020.

different segment of Disney have been impacted significantly due to emergence of covid-19 as economy is just shut and physical movement is almost banned so people cannot gather and the film business is also completely flat for now and it is expected to continue until there is substantial recovery.

Studio business of Disney is the Majorly hit because of covid-19 as physical operations are completely shut and the business and film are not functional these days so the studios are completely shut, leading to a shrinkage in revenues and growth as well as profit.

Disney media network is the highest contributory to the overall profit of the Disney group has it is continuing to be operational but since it has a wide dependency on Disney studio the profits will be shrinking because of inter-departmental dependence.

Direct to consumer and international business of Disney is lesser affected and it consists of streaming services of Disney and since it is is digitally operational the relative impact has been significantly lower but due to the interdependence on to other segments of Disney, revenues, sales, and profit margins, are going to shrink in future.

Amusement park business of Disney is completely shut and there is no revenue generation and it will be the last to open as it is related to public gathering.

overall the profits and margins of the Disney group are expected to decrease in coming quarters because of fear leading from the contagian and since business of Disney is more physically oriented the risks of coronavirus cannot be completely avoided.

it can be reflected through the share prices of Disney which has fallen drastically and it has not yet recovered amid the fear of corona virus.