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Says job not right ‘fit’ after 2 years of 1st-quarter losses
His resignation came after two years in a row of nasty March surprises, both ironically having to do with the red planet. Last year, it was “Mars Needs Moms,” a creepy animated movie that lost $70 million. This year, it was “John Carter,” a sci-fi action movie set on Mars that resulted in a $200 million loss for Disney.
Mr. Ross, 50, said in a memo to staff that he no longer thought his role as chairman of Walt Disney Studios was “the right professional fit.”
The move was not surprising to analysts, coming a few months after studio marketing chief M.T. Carney also departed because of a string of lackluster releases.
Disney’s most successful movies recently have been made by studios it has bought, including “Toy Story” maker Pixar, which will release “Brave” in June, and Marvel, which will release the much-buzzed “The Avengers” overseas next week.
Under the Touchstone brand, Disney also distributes movies made by Steven Spielberg’s DreamWorks production company, including “War Horse.”
Fixing problems at the studio is seen as crucial for the company because movies launch characters that are developed into Disney toys, theme park rides, books and video games. For example, Cars Land, an attraction based on the Pixar movies, will open at Disney California Adventure in June.
Although some of Mr. Ross‘ troubles stemmed from films put into production by his predecessor, Dick Cook, analysts said his inability to prevent big losses was what led to his exit.
“At some level, he takes responsibility for not fixing them or shutting them down,” said Needham & Co. equity analyst Laura Martin. “They need to lower the risk of entry and build franchise films from that base. Not go all in, hoping it works out.”
Part of the estimated $250 million budget on “John Carter” can be attributed to the notion that the movie could become a multipart series, as it was based on a trove of books by the late Edgar Rice Burroughs. The series began with “A Princess of Mars” in 1917 and carried through to the posthumously published “John Carter of Mars” in 1964.
The movie, starring Taylor Kitsch, had a budget that rivaled what 20th Century Fox spent on “Avatar.”
But “John Carter” made just $269 million at box offices worldwide, while “Avatar” took in $2.8 billion. After splits with theater owners and marketing expenses, Disney said “John Carter” would cause a studiowide loss of $80 million to $120 million in the January-through-March quarter.
Mr. Ross took the job just 2½ years ago with a mission to cut costs and develop new hits. He brought “High School Musical” and “Hannah Montana” to TV audiences when he headed Disney Channels Worldwide.
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