- Rumors of Apple buying Disney have been around for years.
- Financial analysts are still predicting the acquisition to happen.
- But could Apple really afford to buy Disney, and would Disney ever sell?
The rumor that Apple will buy Disney is as old as the iPod. Every few years, financial analysts make predictions that the deal is about to happen, and they often cite Bob Iger’s hints that he might sell of parts of the company as evidence. But analysts seem to be forgetting that Iger has also said this was only when Steve Jobs was alive, and the two had never once spoken about a deal.
At one point an analyst did actually do some math. In 2017, analyst Amit Daryanani said there was a “confluence of events” that meant Apple should buy Disney. That was “should,” not “will,” but Daryanani made it sound like Tim Cook would be an idiot to not do it. And — remember this was 2017 — Daryanani’s calculations said Apple would have to take on significant debt to do it.
Apple has cash reserves of around $200 billion, according to Investors.com, which believes the company should be giving that to investors instead of acquiring firms. So on paper, Apple has the money to buy Disney, but it would cost more than the company’s market capitalization of $175.4 billion. Additionally, Disney has no real reason to want to sell and is doing well when looked at as a whole.
Needham & Company entertainment and internet analyst Laura Martin argued that it’s the headset, stupid. Martin said Apple owning Disney would help the Vision Pro headset, but the company is already doing well with getting its content onto the device.
Ultimately, Apple may have the resources to buy Disney, but it’s not the only factor that matters. Disney is doing well and has no reason to sell, and financial analysts should take that into consideration before making predictions. Laura Martin recently spoke out about Apple’s current streaming offerings, saying that Apple’s $2 billion streaming budget and $1 billion film budget is “sort of laughable” compared to other streaming services. She believes that Apple needs to acquire content in order to create consumer lock-in.
The question of whether or not Apple is ready to buy Disney has been circulating for months, but the size of the companies poses a problem. Even if the two firms come to an agreement, U.S. regulators will still need to approve it.
While Disney has made some of its subsidiaries available for sale, it may not be willing to part with the parts of the company that Apple is interested in. Furthermore, Apple has yet to introduce any other major deals since passing on the MGM deal, suggesting that they are not actively pursuing content.
Ultimately, regulators may not approve of any potential deal, and it’s unclear if it would even be beneficial to Apple in the long run. For now, it appears that Apple is content with its current streaming offerings.
