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Disney magic kingdom game revenue2/23/2024 ![]() In fact, its three most streamed series in 2020 were all licensed. Despite all this spending, Netflix still relies heavily on content it licenses from other creators. This strategy is not cheap, and Netflix’s original content budget rose from $2.4 billion in 2013 to $19 billion in 2021. Losing popular content to Disney, Warner Bros, Paramount, and NBC (because they now have their own streaming services) forced Netflix to shift to creating its own original content. ![]() Netflix Can’t Match Disney’s Content Budget Forever Motion Pictures Association’s 2020 THEME Report Sources: New Constructs, LLC and company filings. We think of Disney’s streaming offerings as another entry point into the magic kingdom’s content monetization platform.įigure 1 shows subscription fees from streaming services account for only 12% of the firm’s revenue in 2020.įigure 1: Disney’s Revenue by Segment in Fiscal 2020 While the firm believes its streaming business will be profitable by 2024, profits are not the point for Disney’s streaming business. Unlike Netflix, Disney’s profitability is not dependent on streaming because the firm is, rather uniquely, positioned to monetize content across many business segments. cheap valuation and large upside for DIS if profits reach 2018 levels.parks and cruises will rebound beyond pre-covid levels.ability to generate profit if streaming margins approach zero.growth in streaming is outpacing expectations.unmatched ability to create and monetize original content.DIS continues to present quality risk/reward given Disney’s: Today, Disney’s stock remains undervalued as its business recovers from the pandemic and enters the next phase of growth. While the stock has underperformed the S&P 500 by 3% since our first article, it is up 65% (vs. ![]() We first made Disney a Long Idea in January 2017 and a Micro-Bubble winner in August 2018. Learn more about the best fundamental research
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