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although he had some issues with the earnings Disney earnings CEO Bob Iger saw the streaming part of his business
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is on track to profitability it's not quite there yet but they only lost1 18 million on streaming this quarter
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compared to over this number is incredible $600 million in the same quarter last year that's a good thing
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actually because it looks like it's just like Netflix it's moving to profitability um investors weren't sold
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on that news shares sunk 10% based on some Jitters around the parks business growth is expected to be flat there in
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Q3 the CFO is blaming higher operating costs inflation and quote Global moderation from Peak poid Peak covid
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Travel for that people went to the parks jammed them and now are back to normal behavior Scott let's focus on the
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streaming this business is leaning into password crackdowns and sequels um password crackdowns have worked really
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well for Netflix um they um uh they've been taking away passwords my kids are depressed now because they can't use my
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pass my Netflix thing um and now I have to pay for more of them um uh there that
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that helped Netflix a lot so passord um and making sequels they've got a Moana sequel one for inside out and our
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favorite Deadpool um there are two Frozen coming up soon they've sort of leaned out of the Marvel Universe
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because it's gotten the MCU because uh it's it's it's a little tired so talk a little bit first about streaming and
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then where every I think the parks will be fine they'll be fine they'll figure this was really unusual because if I
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just read the earnings report I wouldn't have guessed Disney on its on announcement of its earnings it had one
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of its worst days it's usually not a very volatile stock and it lost 10% of its I think it was even 11% of its value
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at one point in one trading day and what's interesting is I don't think they saw this coming because the Market's
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been focused on their streaming losses and effectively they're now break even the streaming Market is just an amazing
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case study in economics because overspending built a huge Market Market but there was people were spending too
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much Capital now it's being massively rationalized in an incredible clip what they weren't expecting was that the
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analysts would get so jittery about the gift that was sort of the consistent gift they kept on giving and that was
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the parks and when they gave forward guidance saying look the sugar high of Co or people wanting to get out postco
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is wearing off and the parks might not produce the massive Eva and it took the stock way down this
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might this might create some unnatural acts at the company because the bottom line is that if this stock goes sub 100
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and underperforms I don't think Nelson's going away the activist this was an activist investor who was trying to get
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a seat on the board typically what happens with activists is that the first board meeting they lose and then
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management has a year to get the stock back up and if they get the stock back up everyone's happy if they don't get
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the stock back up the activist gets a couple seats at the second board meeting that's where we are now now and so I
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would imagine this was a really ugly earnings call for Bob because if the stock does decline over the next two
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quarters Nelson's back third time Nelson's back and and I think the board is going to get very serious about a
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succession plan and trying to present a new strategy which he's got to be interested in but this is this this is
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no getting around it the Market's reaction to this was surprising and ugly uh ugly for Bob because the only thing
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that keeps Nelson off the board unless Nelson's already sold which I doubt is if the stock uh is if the strategy they
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put in place seems to be getting traction yeah and they've got a lot of uh allies it's it's Nelson feld's I per
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elon's involved with them there's a whole bunch there's a whole pel of people that are going to start agitating
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at Disney that said the the streaming business is going to is going to decline in in losses and then become very
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profitable I suspect as the others you know you have we have a company called Paramount that's in play right now may
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or may not sell it's been a big mess um there's a whole bunch of streaming consolidation about to happen and the
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people that are going to be standing are Netflix Disney um s Warner and Time Warner HBO and even they are in have
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some problems going forward um we'll see what would you do if you were him what would be the move you would make besides
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Moana and Deadpool um I would probably shed the Cable business and let someone roll up
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all the Bad Assets the TV business they don't have TV business excuse me the TV business the broadcast the TV business
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ABC Etc and I would I would um uh focus on streaming in the Parks Parks your cash streaming is the problem there CBS
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will also be on the market but I think what the opportunity there is for a private Equity Firm to come and take all
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of them cut costs and go bad bank and consolidate all of them and just try and cut costs faster the business toin sell
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those off all the C and ESPN everything yeah because right now those businesses what they do is they create a lower
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multiple on the entire business yeah because typically when you having a conglomerate when you have a bunch of
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businesses CEOs love it because it creates a lack of volatility and the bigger the business the higher
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compensation but investors don't like it because I don't need Bob Iger to put me
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in the Parks business I can go buy stock in a park business or I can go buy stock
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in a pure place streaming company called Netflix so investors don't like it and typically the way investors punish CEOs
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for being in a bunch of businesses that may or may not be unrelated and some people would argue Disney has a flywheel
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but typically in a conglomerate investors will find the worst business with the lowest multiple and they will
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assign that business they will assign that multiple to the entire business so often timesing them down so I would
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imagine if the stock goes really if the stock goes down to say 70 or 80 Nelson will switches complexion to this company
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needs to be broken up right and they'll have to sell a part he's got to sell that it's going to be hard to sell a
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Broadcast Network right now um because there's so many in the the money's declining soapers but you could make a
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lot of money as you've noted on the decline um linear networks you can soak them till the very end and and keep them
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in business a business like Yahoo I recently interviewed its CEO is doing rather well now if you can they're great
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businesses they're just in Decline they still they still Hemorrhage cash they're
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just in Decline y y or you can do something bring the costs in line and then it's not even in Decline it just is
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maintaining in a lot of ways that's what's happening at Yahoo um we'll see what's happened picked me one CEO for
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that company off anybody you could pick Disney Disney one not the ones that are necessarily In Contention within it's
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Danny Walden um uh who's had some problems at ABC uh Jas uh Jimmy Peto who's had some problems at ESPN The
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Parks guy who now has some problems um pick anyone outside the company Evan Spiegel or the guy who runs fubo fubo TV
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he seemed pretty bright to me okay someone like that well Evan is incredibly talented incredibly creative
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I think he's pretty good with shareholders snap is actually doing pretty well I think they need quote
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unquote some youth at the senior management level all right I'm gonna give you one that you're gonna love
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Cheryl Samberg chery Samberg to run Disney she was on the board well I I look I think calmed down enough around
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her except for with you I think anyone who does that kind of damage to the mental health of young teen girls girls
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should have that type of opportunity okay I'm just telling you she good operator she knows all those
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businesses okay yeah you let all the men return she's going to return just like the rest of them