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Walt Disney Co/The
Rich Ross, chairman of Walt Disney Co. (DIS)’s film unit, resigned following the company’s $200 million loss on the science-fiction picture “John Carter,” possibly the biggest ever for a single movie.
The departure of Ross, 50, who has run the division (DIS) since October 2009 and previously led the Disney Channel, was announced today in a statement. A successor wasn’t named.
Disney Chief Executive Officer Robert Iger’s strategy of producing fewer films, built around marketable characters such as those from its Pixar and Marvel units, faltered with the failure of “John Carter.” The movie will lead to a quarterly loss of as much as $120 million for the studio, the first since Ross succeeded Dick Cook as chairman.
“I don’t know that anybody is shocked,” said Martin Pyykkonen, an analyst with Wedge Partners in Greenwood Village, Colorado, who doesn’t rate stocks. “‘John Carter’ was a debacle and probably the last straw,” he said, citing past disappointments including “Mars Needs Moms.”
Disney, based in Burbank, California, gained (DIS) 0.6 percent to $42.35 at the close in New York. The shares have risen 13 percent this year.
Ross, a 15-year Disney veteran, previously worked at and led the Disney Channel, creating shows including “High School Musical” and “Hannah Montana,” starring Miley Cyrus.
“I appreciate his countless contributions throughout his entire career at Disney, and expect he will have tremendous success in whatever he chooses to do next,” Iger said in the statement.
Disney ranks seventh among studios in 2012 domestic ticket sales with $186.7 million, according to researcher Box Office Mojo. “John Carter,” made for about $250 million, generated $269.4 million in worldwide ticket sales, a sum shared with cinema operators.
The film went over budget and was poorly marketed, Pyykkonen said. Studio marketing chief MT Carney, an outsider hired by Ross in 2010, left in January, before the movie opened.
Matthew Harrigan, an analyst at Wunderlich Securities in Denver who has followed the industry for 20 years, said last month the loss on “John Carter” was the biggest he’d seen.
The studio’s “Marvel’s The Avengers,” estimated by Internet Movie Database to cost $220 million, opens May 4 to mark the start of the traditional summer film season in the U.S.
Disney reports fiscal second-quarter earnings on May 8. The company is expected to post a profit of 57 cents a share, the average of 28 estimates (DIS) compiled by Bloomberg, on revenue of $9.56 billion. The company had net income of $942 million, or 49 cents a share, on revenue of $9.08 billion a year earlier.
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