Disney Drops

Disney saw its revenue drop 42% year-over-year as the coronavirus wreaked havoc across the company, resulting in a nearly $5 billion loss. While its theme park business took the biggest hit, its media networks, including ESPN and ABC, experienced a 2% drop in revenue.

That drop was largely due to lower advertising revenue alongside the absence of live sports. Disney was able to lower its programming and production costs due to the deferral of NBA and MLB rights fees until later in the year. ESPN pays the NBA roughly $1.4 billion a year and MLB $700 million a year.

In June, ABC’s ad revenue dropped an estimated 51%, while ESPN’s fell an estimated 20%. Without MLB, NBA Finals and NHL Stanley Cup Finals, among other summer broadcast staples, TV ad revenue was down 9% overall that month.

But even without live sports, ESPN+ continued to grow subscribers. It now has more than 8.5 million, up from 2.4 million last June. However, that growth is largely because of bundles with Disney+ and Hulu, which have 57.5 million and 35.5 million global subscribers, respectively. The company’s streaming services as a whole grew revenue 2% to $3.97 billion.

The return of sports has been a boon for ESPN thus far. MLB was up 34% in viewership over last year through the first 12 broadcasts. Disney also brought on more than 100 advertisers for the NBA restart.

Planet Fitness saw its quarterly revenue drop 77.9% year-over-year as it became the latest company in the fitness industry marred by the COVID-19 pandemic. It lost $32 million in its 2020 fiscal second quarter, compared to bringing in a net income of $39.8 million in 2019.

Roughly a quarter of Planet Fitness’s 2,059 locations remain closed because of the COVID-19 pandemic. The company said all of its locations were closed at some point of the second quarter because of the pandemic.

Planet Fitness CEO Chris Rondeau said on a conference call that while his company took a hit, it’s looking at a post-pandemic gym landscape that could have less competition. Independent gyms have been closing down in droves and chains like 24 Hour Fitness and Gold’s Gym will emerge from bankruptcy reorganization with fewer locations.

“There is going to be a six- or 12-month time period where gyms will look to reopen or not reopen,” Rondeau said. “There is some opportunity there for us.” Planet Fitness shares are down 32% this year, despite reaching an all-time high in February.

In a letter to Congress, the International Health, Racquet & Sportsclub Association outlined how COVID-19 has impacted the fitness industry:

 — $7 billion in projected revenue loss through July 1.

— 25% of gyms expected to close for good this year.

— 489,000 fitness employees unable to work.

A $300 million second-phase of the “Disneyland of football” is expected to start this fall in Canton, Ohio, around the Pro Football Hall of Fame. Former Disney executive Michael Crawford is leading the investment group behind the resort project.

A stadium and sports complex have already been built on the site, and future plans include a football-themed water park, hotels, retail space and apartments. Project developers expect the project’s second phase to finish in 2022, when it hopes fans will look to travel again post-pandemic.

The company is also planning to develop original content and branch into sports betting and esports.