Disney's game group posts $55 million quarterly loss

Media giant's Interactive Media division remains in red despite 20 percent revenues rise; six-month sales fall 15 percent to $376 million.

May has seen such game publishers as Nintendo, Capcom, Namco Bandai, Activision Blizzard, and Electronic Arts filing earnings reports. So too have a number of multimedia multinationals with gaming interests, such as Vivendi this morning. This afternoon, it was the Walt Disney Company's turn, with the mouse house today reporting $953 million in profits on $8.58 billion in revenue for the quarter ending April 3, 2010.

Disney hopes the arcade racer Split/Second will fuel explosive sales growth in the current quarter.

A major contributor to Disney's swelling coffers was the box-office proceeds from director Tim Burton's film Alice in Wonderland, which has now grossed nearly $1 billion worldwide. However, the company's Interactive Media division still posted a $55 million loss for the quarter, a modest improvement from the $61 million it lost during the same period in 2009.

"Improved operating results reflected higher Club Penguin subscription revenues and lower video game inventory costs, partially offset by higher Internet product development and sales and marketing costs," the company said in a statement. Club Penguin is Disney's kid-friendly massively multiplayer PC game, which is receiving a DS spin-off--Club Penguin: Elite Penguin Force: Herbert's Revenge--later this month.

Whether Disney's Interactive Media division can turn around depends on the performance of its upcoming game slate. As outlined in a presentation by group president Stephen Wadsworth at this year's DICE Summit, the company has four major games due out this year: the racer Split/Second (May 18), the platformer Epic Mickey (Q4), the movie tie-in Tron Evolution (Q4), and the action role-playing game Pirates of the Caribbean: Armada of the Damned (Q4).

Disney also touted its $4 billion acquisition of Marvel, which will receive a big revenue lift from Iron Man 2 income, and the licensing of its numerous characters. Many of those characters, including Iron Man, are the subject of games currently developed by third-party publishers.

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Discussion

29 comments
VarietyMage
VarietyMage

Addition: I'm not sure about the game adaptation of the upcoming Tron Legacy movie coming out at the end of this year. Movie-adapted games tend to suck in my not-so-humble opinion.

VarietyMage
VarietyMage

Maybe if Buena Vista Games put out Tron 3.0, I'd buy it. Tron 2.0 was a nice ride (except for the final boss battle), and I still replay it from time to time, both for the story and the light-cycle mini-game. I'm not into any of the other Disney and Disney-based games.

ScreamDream
ScreamDream

[This message was deleted at the request of the original poster]

Kingdom011
Kingdom011

even though kingdom hearts is not a disney game, its the best game that disney is part of. Maybe disney should stop making games and get sqaure enix to do it for them. Heck square made boat loads of money from kingdom hearts.

buffdaddy69
buffdaddy69

No Marvel game shall top the beast known as Batman Arkham Asylum

thorughfire
thorughfire

They loss money because Disney games suck. Seriously if they didnt base their games off their hit shows then they would see a huge spike in sales.

tahseen92
tahseen92

[This message was deleted at the request of a moderator or administrator]

Ladiesman17
Ladiesman17

I hate Disney's IP(s)!! :? whadda ya expect from Mickey Mouse IPs, Donald Fvck, Winnie The Boo, Sin"BAD", Barbie lover!! Pinocchio, Mermaid fish, Mulan, High School Musical, screw you!! Disney's lover!! :(

strayfies
strayfies

Well for the record Iron Man 2 is a Q2 release, Q1 ended in April. But that's not all surprising; if they're up $938 mil, they've got some wiggle room and Q1 is almost never a boon. Q4 is where they have to pull it together, meaning this Damned Armada title is probably gonna get a ton of ad coverage. And yes, for the record Kingdom Hearts is a join licensed product but not their development. They probably do see some royalty share but nothing substantial enough to call it "Disney's".

mrzero1982pt2
mrzero1982pt2

@gabe447 kingdom hearts isnt a disney property. its a square/enix property with disney characters. one of the only rare times disney leases out its characters and universe. think of it like their version of capcom vs snk, but disney still gets small amounts of money from the deal. anyone who makes a disney game? thq who made up, and companies like activision? since disney owns marvel, any money made from a marvel game, some money goes to the publisher and developer but a huge MAJORITY of the money goes to disney. example? iron man 2. sega made it, but disney is reaping the benefits of the sale. when the game goes greatest hits/platinum hits for the respective console, if the game is 30 bucks then disney will receive 25 or 22 bucks from it. sega will receive the other 2 or 8. paramount made the film, it made 150 million but they get 8 percent of the profit while disney gets the other 92, so just think how that works for publishers of disney franchises. that is how they will get their money

Rock_Roberts
Rock_Roberts

Oh...I forgot about Kingdom Hearts...which both where great games. But my point is that they havent put out the best games since SNES and SEGA Genisis on a regular bases...

Rock_Roberts
Rock_Roberts

Wow...WD not making money on games like WALL-E and other crap like that? Really tho, WD stop making good games past The Lion King, Toy Story, and Allidan for the SNES and Sega...Man I feel old now remebering those games...lol.

thattotally
thattotally

Well maybe if Disney actually makes good games... Hell do they even MAKE any games? Is it just movie tie-in garbage? I mean the guys are rich, it would be nice if they jumped on the video game bandwagon and made a stellar action RPG.

Gabe447
Gabe447

Kingdom hearts is the best chance of disney making a good profit.

mrzero1982pt2
mrzero1982pt2

well, @1speedbike, remember those idiots have one big trump card... THE MARVEL FRANCHISE! yes, if you dont remember disney said that companies like paramount, sony and the movie franchises are safe FOR NOW and that goes for activision and capcom and sega. yes, sega has the rights to make thor and captain america, but when you look at who has the other marvel comic game franchises, and that is ACTIVISION. marvel ultimate alliance, x-men legends? those games? marvel's contract with activision is coming to an end and with that, many of the studios who made games for activision will be waiting for a new job, and what better way for disney to poison franchises than by buying them. so in a few years, i say before the new consoles(the mythical psp2, ps4, the new xbox and nintendo consoles) you will see marvel games under the disney games umbrella and that will bring more money to them, pending real marvel fans(like i) arent over on the dc side bc that dc universe online is lookin pretty fine now

1speedbike
1speedbike

Guys, remember that Disney funded the latest Turok adaptation. While that game in particular wasn't that great, Disney doesn't shy away from violence, so the non-violent/family fun comments aren't necessarily true. Disney might have the family-friendly image in terms of its movies/television shows, but its games divisions are more separated. Given that Disney has an enormous budget and great potential for funding great games, I'd like to see more games (and better games) coming out of their game studios!

jaijames
jaijames

Ummmmmm kingdom hearts of the ps3 would boast your profits

jaijames
jaijames

[This message was deleted at the request of the original poster]

impost3r
impost3r

Conservative, NON-violent, wholesome, good ol'fashioned family fun that even your 92 year old grandma can enjoy... that's totally what video games are about! How can Disney fail?!!

uberjannie
uberjannie

I expect Toy Story 3 to sell heaps of copies :D Plus, after watching the quicklook on giantbomb , I'm considering buying it myself xD

Ironfungus
Ironfungus

Maybe those idiots will get the hint and stop *trying* to make video games.

TristanH12
TristanH12

We all better buy this SplitSecond!

firedrakes
firedrakes

overall its fine to loss this with marvel

BangaaPride
BangaaPride

Almost everyone is posting losses despite lots people still buying games. What's up with that?

ekultus
ekultus

Shimmy shimmy shimmy through the break of dawn, yeah!