Disney reports $300 million equity loss from India JV in Q2 FY25

New Delhi: The Walt Disney Company has reported a $300 million equity loss from its India joint venture (JV) with Reliance Industries (RIL) in the second quarter of fiscal year 2025. The loss, primarily attributed to purchase accounting amortisation, was disclosed in Disney’s Q2 FY25 earnings, highlighting the financial adjustments required following the formation of the JV, named JioStar, which was finalised on November 14, 2024. Disney’s fiscal year runs from October to September.

The JioStar JV merged Disney’s Star India assets, including Star-branded TV channels and the Disney+ Hotstar streaming service, with RIL’s media and entertainment businesses, Viacom18. RIL holds a 56% controlling stake in the entity, while Disney retains a 37% minority interest, with a third-party firm holding the remaining 7%. This restructuring means Disney no longer consolidates Star India’s financials, instead recording its 37% stake as “Equity in the income of investees.”

Disney’s international operating income for the quarter plunged 84% year-on-year, dropping to $15 million from $92 million in Q2 FY24, reflecting the exclusion of Star India’s contributions. Additionally, income from equity investees fell sharply to $36 million, down from $141 million a year earlier, further underscoring the impact of the JV.

The company also reported $109 million in content impairment charges for the quarter, a significant reduction from the $2.05 billion in goodwill impairments recorded in the same period the previous year, largely related to Star India’s linear networks business.

Despite these setbacks, Disney’s overall Q2 FY25 revenues rose 7% year-on-year to $23.6 billion, driven by strong performance in its entertainment segment, which posted a $1.3 billion operating income, up $500 million from the previous year, boosted by box office hits and growth in other areas. However, the absence of Star India’s contributions remained a notable gap, with the sports segment lacking the $105 million in revenue reported in Q2 FY24.