Disney’s ongoing carriage dispute with YouTube TV is costing the entertainment giant tens of millions of dollars per week, according to an analysis by a Wall Street leader.
YouTube TV customers have lost access to ABC and ESPN amid the dispute with Disney, the parent company of those media brands, with the blackout entering its 13th day on Wednesday.
An analysis by Morgan Stanley estimated in a research note released Sunday that the impact of 14 days of the YouTube TV blackout would create a $60 million revenue headwind for Disney. That amounts to about $30 million per week, or about $4.3 million per day, in lost revenue due to the dispute.
Morgan Stanley noted that YouTube TV is the third-largest multichannel provider in the U.S., and forecasted that the dispute will end later this week – though it estimated that each week of lost distribution would lower adjusted earnings per share (EPS) by $0.02.
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The firm reiterated its overweight rating for Disney stock and had a price target of $140. Disney’s stock was trading around $116 per share on Wednesday.
Amid the ongoing dispute, YouTube TV is offering subscribers a $20 credit to compensate them for the loss of Disney channels during the impasse.
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| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DIS | THE WALT DISNEY CO. | 116.73 | +1.86 | +1.62% |
| GOOGL | ALPHABET INC. | 286.71 | -4.60 | -1.58% |
YouTube TV, a subsidiary of Google parent Alphabet, wrote Sunday in a post on X that, “We’ve been working to negotiate a deal with Disney that pays them fairly for their content and returns their programming to YouTube TV. We know it’s been disappointing to lose Disney channels, and in light of the disruption, we’re offering our subscribers a $20 credit.”
“Over the next few days, family managers will receive an email with instructions on how to redeem their $20 YouTube TV credit. We remain committed to working with Disney to bring their content back, and we appreciate your patience while we work toward a solution,” YouTube TV’s post concluded.
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Disney Entertainment co-Chairs Dana Walden and Alan Bergman and ESPN Chairman Jimmy Pitaro said in a memo to Disney employees on Friday that “YouTube TV continues to insist on receiving preferential terms that are below market and has made few concessions.”
Last week, the two companies discussed restoring ABC for coverage of Election Day, but they were ultimately unable to reach an agreement to do so.
The ongoing dispute has also cost YouTube TV subscribers access to ESPN and sports events broadcast on ABC.
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