Walt Disney is cutting its content budget for the year by $3 billion, CEO Bob Iger said Wednesday on the company’s third-quarter earnings call, in part because of the ongoing WGA and SAG-AFTRA strikes.
“We currently expect fiscal 2023 content spend to come in at approximately $27 billion which is lower than we previously guided due to lower spend on produced content, in part due to the writers’ and actors’ strikes,” Iger told Wall Street analysts.
The notion of cost savings due to the ongoing production stoppage has been a sensitive topic. No company wants to be seen as benefiting from the cost savings in halted work. At the same time, all media companies have faced pressure from investors to rein in content budgets that ballooned during the streaming wars.
In Disney’s case, the cuts can’t be attributed solely to the effects of the strike. In February, shortly after Iger resumed his role as CEO, he unveiled a restructuring that led to thousands of layoffs and cut about $5.5 billion in content costs. On the call, Iger also discussed releasing fewer films that were lower in cost while “improving the quality.”
Under Iger’s predecessor, Bob Chapek, Disney’s annual content spending ballooned, with a target budget of $33 billion a year. At $27 billion a year, it would still be above 2021 levels.
