How much juice can be squeezed out of a franchise? Or an individual character for that matter? Quite a lot according to the folks at Walt Disney (US: DIS), whose Pixar Animation Studios have just released their fifth film in the Toy Story franchise; an origin story about one of the original film’s lead characters, Buzz Lightyear.
In this ‘prequel’ we get to watch the film which Andy and his peers from 90s animated fiction enjoyed so much that its lead character became one of the world’s top selling toys. It’s a good hook, but it’s perhaps a bit too clever. Real life 90s kids flocked to watch Toy Stories 3 and 4 at the cinema because they wanted to find out what happened to Buzz - the toy that they grew up with having been first introduced to him in 1995. This film introduces a new character (with a new voice). It doesn’t tick the nostalgia boxes that previous sections of the franchise did so expertly.
That is one of the theories currently being circulated to explain Lightyear’s underwhelming domestic box office performance - the film took in $50.6m over its opening weekend, some way short of an expected $85m. Another hypothesis is that Lightyear has been hampered by the success of Disney+, where most of Pixar’s more recent films have landed directly. At the last count the platform had almost 140 million subscribers worldwide, many of whom seem happy to wait to watch Lightyear on the small screen.
But does an underwhelming big screen performance matter?
Certainly not as much as it used to. At its heart Walt Disney is an animation studio, but cinema ticket sales are no longer the core of its business. It has been a long time since the Studio Entertainment division contributed meaningfully to either the top or bottom line. In 2005, Parks & Resorts overtook Studios to become the company’s second largest revenue contributor and in 2021, Disney’s new boss Bob Chapek oversaw the merger of the Studios segment into a broader Media and Entertainment Distribution division.
Walt Disney financials: mixed fortunes
Media and Entertainment Distribution | Parks, Experiences and Products | |||
Year to 30 Sept | Revenue ($bn) | Operating Profit ($bn) | Revenue ($bn) | Operating Profit ($bn) |
Q1 2020 | 13.3 | 1.47 | 7.58 | 2.52 |
Q2 2020 | 12.4 | 1.65 | 5.66 | 0.76 |
Q3 2020 | 10.7 | 2.98 | 1.07 | -1.88 |
Q4 2020 | 12.0 | 1.55 | 2.73 | 0.95 |
Q1 2021 | 12.7 | 1.45 | 3.59 | -0.12 |
Q2 2021 | 12.4 | 2.87 | 3.17 | -0.41 |
Q3 2021 | 12.7 | 2.03 | 4.34 | 0.36 |
Q4 2021 | 13.1 | 0.95 | 5.45 | 0.64 |
Q1 2022 | 14.6 | 0.81 | 7.23 | 2.45 |
Q2 2022 | 13.6 | 1.94 | 6.65 | 1.76 |
The new structure paints a picture of Chapek’s vision for the next chapter in Walt Disney’s…
