CEO Bob Iger admits Disney theme park price adjustments are “too aggressive,” the report says.
ORLANDO, Florida. — Walt Disney Company CEO Bob Iger admitted that the theme park giant’s austerity drive, which has driven park prices up and job cuts, may have been “too aggressive,” according to a report in the LA Times.
Iger spoke about the company’s pricing strategy at the Morgan Stanley Technology, Media and Telecom conference on Thursday, adding that some of the financial moves taken have backfired, according to the LA Times.
“In our quest to increase profits, we may have been too aggressive on some of our pricing,” Iger said in an interview with the LA Times. “I think there is a way to keep growing this business, but be smart about how we set prices to maintain brand value in terms of accessibility.”
According to the LA Times, Iger said Thursday that he “will continue to listen to consumers” and “will continue to adapt” as the company realized some financial moves, including price hikes at Disney parks, were backfiring.
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It’s also because the company installed the free version of the Disney+ streaming service for $10.99 a month, which is $3 a month more than an ad-supported subscription.
“One of the key things we need to figure out is the pricing strategy that makes sense,” Iger said in an interview with the LA Times. “In our quest for global (subscriber) growth, I think we got it wrong in terms of this pricing strategy. And now we’re starting to learn more about it and adjust accordingly.”
Since Iger returned to the helm in November 2022, replacing Bob Chapek, Disney has earned $1.28 billion, or 70 cents a share, in the three months to December 31, compared to a net income of $1.1 billion. or 60 cents per share. , a year earlier.
As of February, Disney’s revenue was up 8% to $23.51 billion, while sales in the parks, experiences and products segment were up 21% to $8.74 billion. On the other hand, the company’s direct-to-consumer business, which includes its streaming services, posted an operating loss of $1.1 billion amid higher programming and production costs at Disney+ and Hulu, ending the quarter at $161.8 million subscribers, down 1% since then. October 1st.
The Associated Press contributed to this report.
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