Friday, the company said that on May 26, 2023, it removed “certain produced content” from its direct-to-consumer streaming services. As a result, Disney will record a $1.5 billion impairment charge in its fiscal third quarter financial statements “to adjust the carrying value of these content assets to fair value.”
Disney said it’s continuing to review content on streaming platforms and “currently anticipates additional produced content will be removed from its DTC and other platforms, largely during the remainder of its third fiscal quarter.” As a result, Disney currently estimates it may incur further impairment charges of up to about $400 million related to produced content.
On Disney’s earnings call last month, CFO Christine McCarthy had said the company expected to take a write-down in the June quarter of $1.5 billion-$1.8 billion from removing content from its streaming platforms. By writing down the value of the content assets, Disney can remove that from its balance sheet and reduce its tax bill., including series “Willow,” “The Mysterious Benedict Society” and “Dollface,” and movies such as “The One and Only Ivan.