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The new winners and losers of leisure time will be on full display Tuesday as Walt Disney Co. prepares to outline its issues in the real world while videogame makers detail how the pandemic is playing out in virtual realms.
More people may be streaming videos on Disney+ now that the COVID-19 outbreak has forced people to stay indoors, but that newfound digital success can’t make up for all the ways that Disney DIS, -2.19% is hurting during the crisis. The company is set to provide an early look at what theme-park closures, film delays and a lack of live sports mean for its business, though the real pain lies ahead — U.S. theme parks and movie theaters were only closed for the last few weeks of March, and ESPN began feeling the sting from sporting cancellations around the same time.
See also: Disney+ may be the only plus for Disney as coronavirus slams other businesses
It will take time before any of these Disney businesses return to normal, and the company faces big questions as tries to adapt its business to the new reality. Analysts wonder whether Disney plans to open all its parks and hotels right away, how the company will deal with staffing, and whether it will further postpone blockbuster film releases in order to give them a better chance at box-office success.
Read: Disney is in ‘the eye of the storm’ — analyst warns parks may not open until January
Disney’s results will likely stand in contrast to those of videogame publishers Electronic Arts Inc. EA, +3.14% and Activision Blizzard Inc. ATVI, +3.05% . Gaming is among the rare entertainment categories in which consumers are actually boosting their spending during the pandemic, Visa Inc. V, +0.33% disclosed last week, and EA and Activision have both seen their stocks climb in recent months.
“We’d expect all game publishers to see a benefit from late-1Q and strong early-2Q trends, with outsized benefit to those with new games and/or strong live services ecosystems,” KeyBanc Capital Markets analyst Tyler Parker wrote.
Activision launched “Call of Duty: Warzone” in March to “immense success,” in Parker’s view. EA had a quieter quarter, but he’s upbeat around new “Sims” content and live services engagement for “FIFA” and “Madden.”
Business in the Age of COVID-19: Learn how the pandemic is affecting major companies’ finances
Even early COVID-19 winners face uncertainties about the future, though. Look for discussions of how the publishers are managing their pipelines as developers work on new titles remotely.
Tuesday brings a packed day of earnings with 43 members of the S&P 500 SPX, +0.42% set to report. Here are some of the other highlights.
• Pressures in the traditional meat supply chain might lead more people to try plant-based meats like those made by Beyond Meat Inc. BYND, +3.96%, but the company’s COVID-19 story remains complicated. Jefferies analyst Rob Dickerson is concerned about a reduction in in-store dining during the pandemic, as well as the potential for customers to become more price sensitive given rising unemployment. Those issues will be in focus Tuesday afternoon, along with recent partnership arrangements that have helped spark a rally in Beyond Meat shares over the past month.
Read: Keeping slaughterhouses open to protect U.S. meat supply may boost these food-packaging companies
• The dating game has dramatically shifted now that people can’t leave their homes, and Match Group Inc. MTCH, +3.40% must change its strategy to compensate. The company recently disclosed that users were sending more messages but finding fewer new matches during the early days of the pandemic. The remaining question is whether users will keep paying for memberships on Tinder and other services given uncertainties about when in-person dating will seem safe again. Look for more information after the closing bell about Match’s ability to capitalize on the video-dating trend.
Online dating amid coronavirus: Longer conversations and a ‘pivot’ to video dates
• The advertising market is under pressure, but Wedbush analyst Ygal Arounian said Pinterest Inc. PINS, +8.50% might be relatively insulated due to its category exposure. Unlike Facebook Inc. FB, +1.47% and Alphabet Inc. GOOG, +0.46% GOOGL, +0.42% , Pinterest isn’t as reliant on bricks-and-mortar small businesses, he said, and the company is less exposed to categories like automotive and travel ads. The company has also been improving its direct-response advertising capabilities, in his view, providing an additional cushion as direct-response ads have appeared more resilient than brand spots.
• Other reports to watch include DuPont de Nemours Inc. DD, -0.77% and Wayfair Inc. W, +9.47% before the opening bell as well as Mattel Inc. MAT, +3.43%, KLA Corp. KLAC, +1.14% and Arista Networks Inc. ANET, +1.61% to end the day.
