March 19, 2020 / 2:12 PM / 20 days ago

Disney says coronavirus could impact consumer behavior

FILE PHOTO: The logo of the Walt Disney Company is displayed above the floor of the New York Stock Exchange shortly after the closing bell as the market takes a significant dip in New York, U.S., February 25, 2020. REUTERS/Lucas Jackson

(Reuters) - Walt Disney Co (DIS.N) said on Thursday the spread of the coronavirus could lead to consumer behavior changes, further disrupting its business.

The warning raised speculation that media and entertainment businesses could change in fundamental ways.

The company has already closed its theme parks, suspended cruises and theatrical shows, delayed film distribution, and taken a hit to its supply chain and ad sales.

Long-term changes in consumer behavior could include lower attendance at movie theaters and parks, more subscribers to its Disney+ streaming service, and fewer viewers of live TV.

In its filing, Disney cited disruption in the creation and availability of content, including the cancellation of certain sports events and the shutting down of most film and TV production.

The effect of the coronavirus on capital markets could affect borrowing costs, Disney added.

Moody’s said on Tuesday it expected Disney’s park closures and cruise ship suspensions to be temporary, hurting margins and adding to the $175 million operating income hit taken by its parks, experiences and products division due to park closures in China.

Shares of Disney rose 6% to $93.79 shortly after midday.

Reporting by Helen Coster in New York and Supantha Mukherjee in Bengaluru, Editing by Sherry Jacob-Phillips and Richard Chang

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