The Walt Disney Company is escalating its long-standing disagreement with Google’s YouTube TV regarding fares, which has sparked concerns among investors regarding Disney’s television segment and overall business performance. As a result, its stock saw a significant drop of over 9%.
This conflict with YouTube is particularly impacting the ratings for ABC, notably its evening news. For the first time in several months, “World News Tonight,” hosted by David Muir, has garnered fewer viewers in the critical 25- to 54-year-old demographic compared to NBC.
Disney’s financial report for the fourth quarter indicated a 21% decline in profits from its linear television division, comprising ABC, with earnings dropping to $391 million compared to the previous year.
During a recent discussion with CNBC, Disney’s chief financial officer, Hugh Johnston, mentioned that the company has prepared for the possibility of extended negotiations with Google by including “hedges” in their financial forecasts. “We’re ready to continue as long as they want,” he affirmed.
Disney’s total revenue reached $22.46 billion, falling short of Wall Street’s expectations, with operating profits decreasing by 5% to $3.48 billion.
In the week ending November 7, “NBC Nightly News” surpassed ABC’s “World News Tonight” in the crucial 25-54 demographic for the first time since July, attracting 929,000 viewers compared to ABC’s 883,000, according to Nielsen.
This marks the second occasion this year that NBC has overtaken ABC’s newscast after years of leading in viewership within this target group.
The shift in audience ratings follows a contract dispute that led to a drop in subscribers for both ABC and ESPN below the 10 million mark.
Nonetheless, “World News Tonight” still outperformed “Nightly News” in total viewership, pulling in over 500,000 more viewers overall, based on Nielsen data.
ABC has tweaked its news program titles—a common method among networks to adjust the ratings averages and protect advertising commitments—especially since episodes of “World News Tonight” have been displaced in many regions on Mondays due to the network’s “Monday Night Football” simulcast.
Analysts estimate that the ongoing YouTube TV outage, which began on October 30, could be costing Disney around $30 million per week, or around $4.3 million daily.
There appears to be a growing sense of pessimism within Disney regarding a swift resolution to this disagreement, as both parties remain steadfast in their positions.
With traditional TV viewership on the decline, Disney’s streaming operations reported a 39% increase in operating profits, reaching $352 million, closing the gap with the linear TV division’s profit of $391 million.
The stock has fluctuated between $80 and $125 per share since early 2022, a significant drop from its nearly $200 peak in 2021, reflecting investor skepticism about the company’s streaming strategy.
In an effort to regain favor with investors, Disney is undertaking steps to enhance its financial standing, planning to double its share buybacks to $7 billion and raise its dividend by 50% to $1.50 per share.
Additionally, the company has reaffirmed its expectations for double-digit profit growth in fiscal years 2026 and 2027.
Following the recent news, Disney stocks dipped more than 4% in pre-market trading on Thursday, amid several challenges in the streaming sector.
There have also been reports that Disney executives have suspended late-night host Jimmy Kimmel after his controversial comments linking President Trump’s movement to a recent assassination.
Disney’s film division is experiencing mixed outcomes, with this summer’s “Deadpool & Wolverine” thriving, but the latest “Fantastic Four: First Steps” failing to meet box office expectations.
The organization is also on the hunt for a successor to CEO Bob Iger, whose contract ends in December 2026, with names like Josh D’Amaro and Dana Walden emerging as potential internal candidates.
There have even been discussions regarding the possibility of appointing a joint CEO structure.
Iger made a comeback to the CEO role in November 2022 after his chosen successor, Bob Chapek, was dismissed.
While ABC News declined to provide comments, NBC News did not respond to inquiries either.
The Post has reached out to Disney for a response.
How to watch ABC for free without YouTube TV
There are various live TV streaming services that now exclude channels like ABC from YouTube TV.
DirecTV offers a five-day free trial, with plans beginning at $49.99 per month, covering all affected channels.
