Shares of the entertainment giant, Walt Disney Company, fell after the company released its 3rd quarter earnings reports that issues at ESPN greatly affected the operating income for its cable business.
The report shows that there is an income decline of 23 percent year over year with the trouble at ESPN, which Disney said in a statement. The sports network was bombarded by higher programming costs and lower advertising revenue, as well as the severance and contract terminations costs.
Earlier this week, the Disney stock closed nearly 4 percent lower and was trading at $102.83, the company’s worst trading day since May of 2016.
Bob Iger, CEO of the company, defended the business, even stating that he is confident with ESPN’s future and believes “Live sports are still a huge driver of consumption.”
Disney Company also announced that it will no longer stream movies on Netflix by next year. Disney would instead plan to launch a new streaming service, which will host films exclusively.
In March, Disney’s boards announced it was extending Iger’s contract to July 2, 2019 even though the company has not yet named a successor for him.
In a Tuesday interview with CNBC’s Julia Boorstin on “Closing Bell,” Iger said that Disney has “no plans” to pull Marvel shows from Netflix. The CEO added that the Disney and Netflix have a “good relationship.” Iger also said that Disney may decide to license other content to the streaming giant in the future.