Media and leisure conglomerate Walt Disney Firm has projected an fairness lack of roughly $300 million for FY25 from its India three way partnership with Reliance Industries Ltd, primarily pushed by buy accounting amortization.
The three way partnership, formalized on 14 November 2024, mixed Disney’s Star-branded common leisure and sports activities channels and its Disney+ Hotstar streaming service with the media property managed by Reliance. The Mukesh Ambani-owned agency holds a 56% controlling stake within the three way partnership, Disney retains 37%, and an funding agency holds the remaining 7%.
With this restructuring, Disney not consolidates Star India’s ends in its financials. As an alternative, it reviews its 37% stake within the JV underneath “Fairness within the revenue of investees.” This shift led to a pointy drop in worldwide working revenue, which fell 84% year-on-year in Q2 FY25—from $92 million to $15 million—as a result of exclusion of Star India’s contribution. Disney follows October to September fiscal yr.
For the second quarter ended 29 March, Disney reported a 7% improve in complete revenues to $23.6 billion, pushed by a powerful efficiency in its leisure and experiences segments, based on its earnings report launched Wednesday. The leisure phase posted $1.3 billion in working revenue, up $500 million from a yr earlier. Linear networks’ working revenue grew 2% year-on-year, however the firm clarified this comparability contains $89 million in working revenue from Star India in Q2 FY24, which is not current this yr.
The corporate additionally famous subscription income development from its direct-to-consumer (DTC) platforms like Disney+ and Hulu, pushed by greater costs and extra subscribers. Nevertheless, this was partially offset by overseas trade headwinds and the absence of Star India’s DTC revenues within the present quarter.
Disney additionally recorded $109 million in content material impairment prices in Q2 FY25, whereas the identical quarter a yr earlier had seen a large $2.05 billion in goodwill impairments, largely linked to Star India and its linear networks enterprise. In the meantime, revenue from fairness investees dropped to $36 million from $141 million a yr in the past, reflecting the India three way partnership losses.
The India JV now combines Reliance’s Viacom18 community (with channels like Colours and Sports18) and Disney’s Star community (together with Star Plus, Star Gold, and Star Sports activities) underneath a single umbrella. On the streaming entrance, the JV brings collectively JioCinema and Disney+ Hotstar, making a digital powerhouse with a mixed attain of over 750 million viewers in India.
The mixed Reliance-Disney streaming entity is three to 4 instances greater than the likes of Netflix when it comes to complete hours of programming and will even take a look at buying smaller, niche language-specific entities which can be struggling to outlive, based on trade specialists. Their complete paid subscriber base of 250 million is way greater than the estimated 12 million for Netflix and Prime Video every.
