Robbins LLP reminds investors that a shareholder filed a class action on behalf of purchasers of The Walt Disney Company (NYSE: DIS) common stock between December 10, 2020 and November 8, 2022. The Walt Disney Company, an entertainment company, conducts operations in media networks, studio entertainment, theme parks and resorts, consumer products, and Internet and direct marketing.
What is this Case About: The Walt Disney Company (DIS) Misled Investors Regarding the Success of the Disney+ Platform
According to the complaint, during the class period, defendants repeatedly misled investors about the success of the Disney+ platform by concealing the true costs of the platform, concealing the expense and difficulty of maintaining robust Disney+ subscriber growth, and claiming that the platform was on track to achieve profitability and 230-260 million paid global subscribers by the end of fiscal year 2024. To conceal these adverse facts, defendants engaged in a fraudulent scheme designed to hide the extent of Disney+ losses and to make the growth trajectory of Disney+ subscribers appear sustainable and 2024 Disney+ targets appear achievable when they were not.
On November 8, 2022, Disney issued a press release reporting the Company's disappointing financial results for its fourth quarter and fiscal year ended October 1, 2022. The Company’s DTC segment, which includes streaming services Disney+, ESPN+, Hulu, and Hotstar, reported a monumental operating loss of $1.47 billion compared to a $630 million loss in the same quarter the year prior. The Company also reported a decline in its average revenue per Disney+ subscriber, as more customers subscribed through a discounted bundle with the Company’s other services. Notably, the bundled offering made up about 40% of domestic subscribers, confirming that Disney was relying on short-term promotional efforts to boost subscriber growth while impairing the platform’s longterm profitability. In response, the price of Disney common stock fell $13.15 per share, or more than 13%, on November 9, 2022.
What Now: Similarly situated shareholders may be eligible to participate in the class action against The Walt Disney Company. Shareholders who want to act as lead plaintiff for the class must file their papers by July 11, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member. For more information, click here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
About Robbins LLP: Some law firms issuing releases about this matter do not actually litigate securities class actions; Robbins LLP does. A recognized leader in shareholder rights litigation, the attorneys and staff of Robbins LLP have been dedicated to helping shareholders recover losses, improve corporate governance structures, and hold company executives accountable for their wrongdoing since 2002. Since our inception, we have obtained over $1 billion for shareholders.
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