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Will Disney’s July Restart Fall Apart Before it Begins?

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Just three weeks ago, it looked like Disney was poised to begin its slow crawl back up the mountain in July, with the release of its first movie in three months and the reopening of both Disney World in Florida and Disneyland in California.

The past few weeks have seen the coronavirus come roaring back to life with record spikes in infections and hospitalizations in multiple states — including Florida and California — following a brief period of slow, but steady, progress to combat the pandemic.

That has led Disney to delay the release of its $200 million tentpole “Mulan” for a second time, as well as abandon at least one of its theme park reopenings.

Disney has not put out a new movie in theaters since the March 6 release of Pixar’s “Onward,” which amassed only $103.

Disney’s theme parks, which along with consumer products account for the biggest chunk of the media giant’s revenue, have also stalled their comeback plan.

While the company has not yet moved off a July 11 reopening of Disney World, albeit at reduced capacity and with new safety precautions in place, the plan to reopen Disneyland the following week has been postponed indefinitely.

The State of California has now indicated that it will not issue theme park reopening guidelines until sometime after July 4.

Given the time required for us to bring thousands of cast members back to work and restart our business, we have no choice but to delay the reopening of our theme parks and resort hotels until we receive approval from government officials,” the company said last week.

During its most recent quarterly conference call with Wall Street, the company estimated that its parks business took a roughly $1 billion hit to operating income as a result of the pandemic.

Both Florida and California are experiencing rising case counts that have forced both states (along with Texas) to slam the brakes on their reopening plans.

Also Read: NBA Sets TV Schedule for Season Restart at Disney World.

On Sunday, California reported 5,307 new cases, including nearly 3,000 in Los Angeles County, which far outpaced the prior daily record.

One analyst, Needham’s Laura Martin, lowered her full-year revenue and Q3 forecast.

For the fiscal 2020 year, Martin estimated Disney will now see its overall revenue drop by 3% to $68.

2 billion, a decline of 35% from a year ago.

And those projections include a 81% decline from a year ago for Disney’s Parks, Experiences and Products division.

The performance of Disney+ has surpassed expectations in its first seven months, and could get an influx of new subscribers with Friday’s release of “Hamilton.

Also Read: Disney’s ‘Mulan’ Pushed to Late August as New COVID Cases Continue to Rise.

Disney would have been looking at a nearly 0 million loss in ad revenue if the rest of the NBA season were called off, and while it won’t recoup all of the lost revenue, ESPN will be in a better position than it was a few months ago.