Disney asset sales won’t break the bank, but they will move legacy media forward
Chief executive officer of The Walt Disney Company Bob Iger and Mickey Mouse look on before ringing the opening bell at the New York Stock Exchange (NYSE), November 27, 2017 in New York City.
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Usually when a person or company sells something, the primary motivation is getting back as much money as possible.
Disney‘s motivation to potentially sell ABC and its owned affiliates, linear cable networks and a minority stake in ESPN isn’t predicated on what these assets will fetch in a sale. It’s about signaling to investors the time has come to stop thinking about Disney as old media.
Disney’s market capitalization is about $156 billion. The company has about $45 billion in debt. Selling assets can help the entertainment giant lower its leverage ratio while buffering the continued losses from its streaming businesses.
Still, that’s not the prime rationale for why Disney Chief Executive Bob Iger told CNBC in July he’s contemplating selling off media assets — something he’s long resisted. Rather, a sale of ABC and linear cable networks would be a message to the investment community: The era of traditional TV is over. Disney is ready for its next chapter.
“Disney almost has a good bank and a bad bank at this point,” Wells Fargo analyst Steven Cahall said in a CNBC interview. “Streaming is its future. It’s its strongest asset, next to the parks. The linear business is something Disney has clearly signaled is going to be in decline. They’re not looking to necessarily protect it. If they can move some of that lower, negative-growth business off of the books and to a better, more logical operator, we think that’s good for the stock.”
Nexstar has held preliminary conversations with Disney to acquire ABC and its owned and operated affiliates, Bloomberg reported Thursday. Media mogul Byron Allen has made a preliminary offer to pay $10 billion for ABC and its affiliates along with cable networks FX and National Geographic, according to a person familiar with the matter.
Disney released a statement Thursday saying “while we are open to considering a variety of strategic options for our linear businesses, at this time The Walt Disney Company has made no decision with respect to the divestiture of ABC or any other property and any report to that effect is unfounded.”
Declining values
The value of broadcast and cable networks has significantly declined from the 1990s and early 2000s as tens of millions of Americans have canceled cable in recent years.
Cahall values ABC and Disney’s eight owned affiliate networks at about $4.5 billion. That’s a far cry from the $19 billion Disney paid for Capital Cities/ABC in 1995 — the deal that brought Iger to the company.
ESPN has a valuation of about $30 billion, according KeyBanc Capital Markets analyst Brandon Nispel, “though we view it as a melting iceberg,” he added in a September note to clients. LightShed analyst Rich Greenfield values ESPN at closer to $20 billion.
Disney would like to keep a majority stake in ESPN, Iger told CNBC. It currently owns 80% of the sports media business, and Hearst owns the other 20%.
About 10 years ago, analysts valued ESPN at around $50 billion.
SportsCenter at ESPN Headquarters.
The Washington Post | The Washington Post | Getty Images
Selling ABC
Disney’s most interesting decision may be deciding what to do with the ABC network. The company can easily sell off its eight owned and operated affiliate stations — located in markets including Chicago, New York and Los Angeles — without changing the trajectory of the media industry.
But divesting the ABC network would be a bold statement by Disney that it sees no future in the broadcast cable world of content distribution.
Selling ABC would be particularly jarring given Iger’s comments both to CNBC and in Disney’s last earnings conference call that he wants the company to stay in the sports business.
“The sports business stands tall and remains a good value proposition,” Iger said last month during Disney’s third-quarter earnings conference call. “We believe in the power of sports and the unique ability to convene and engage audiences.”
There’s clear value, at least for the next few years, in keeping a large broadcast network for major sports leagues. NBCUniversal executives hope ownership of the NBC network will convince the NBA that it should be cut into a new rights agreement to carry NBA games. NBC is a free over-the-air service and can increase the league’s reach, they plan to argue. Even if the world is transitioning to streaming, millions of Americans still use digital antennas to watch TV.
Currently, ESPN and ABC split sports rights. Selling ABC may trigger certain change-of-control provisions that force existing deals with pay TV operators or the leagues to be rewritten, according to people familiar with typical language around such deals.
Moving on from the network also may obstruct ESPN’s ability to land future sports rights deals. Without ownership of ABC, leagues may choose to sell rights to other companies, thus further weakening ESPN.
If Iger is true to his word and Disney stays in the sports broadcasting business, the company will have to weigh the negative externalities of losing ABC with the positive gains of showing investors it’s serious about shedding declining assets.
“Obviously, there’s complexity as it relates to decoupling the linear nets from ESPN, but nothing that we feel we can’t contend with if we were to ultimately create strategic realignment,” Iger said last month.
The way forward
If Disney does land a deal to sell ABC, and investors cheer the move, it may also function as a catalyst for other large legacy media companies to sell their declining assets. NBCUniversal, Paramount Global and Warner Bros. Discovery all have legacy broadcast and cable networks in addition to their flagship streaming services.
Disney may become the leader in pushing the industry forward.
“We see this as a real bullish sign at Disney.” said Cahall. “There’s a lot going on now at Disney, between ESPN and partnerships and divesting some of this stuff. Disney is suddenly feeling a little more catalyst-rich than it was recently.”
– CNBC’s Lillian Rizzo contributed to this article.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
WATCH: Nexstar could ‘no doubt’ take ABC and monetize it really well, says Wells Fargo analyst
Elon Musk, chief executive officer of Tesla Inc., during a meeting between US President Donald Trump and Cyril Ramaphosa, South Africa’s president, not pictured, in the Oval Office of the White House in Washington, DC, US, on Wednesday, May 21, 2025.
Jim Lo Scalzo | Bloomberg | Getty Images
Tesla shares have dropped 7% from Friday’s closing price of $323.63 to the $300.71 close on Tuesday ahead of the company’s second-quarter deliveries report.
Wall Street analysts are expecting Tesla to report deliveries of around 387,000 — a 13% decline compared to deliveries of nearly 444,000 a year ago, according to a consensus compiled by FactSet. Prediction market Kalshi told CNBC on Tuesday that its traders forecast deliveries of around 364,000.
Shares in the electric vehicle maker had been rising after Tesla started a limited robotaxi service in Austin, Texas, in late June and CEO Elon Musk boasted of its first “driverless delivery” of a car to a customer there.
The stock price took a turn after Musk on Saturday reignited a feud with President Donald Trump over the One Big Beautiful Bill Act, the massive spending bill that the commander-in-chief endorsed. The bill is now heading for a final vote in the House.
That legislation would benefit higher-income households in the U.S. while slashing spending on programs such as Medicaid and food assistance.
Musk did not object to cuts to those specific programs. However, Musk on X said the bill would worsen the U.S. deficit and raise the debt ceiling. The bill includes tax cuts that would add around $3 trillion to the national debt over the next decade, according to an analysis by the Congressional Budget Office.
The Tesla CEO has also criticized aspects of the bill that would cut hundreds of billions of dollars in support for renewable energy development in the U.S. and phase out tax credits for electric vehicles.
Such changes could hurt Tesla as they are expected to lower EV sales by roughly 100,000 vehicles per year by 2035, according to think tank Energy Innovation.
The bill is also expected to reduce renewable energy development by more than 350 cumulative gigawatts in that same time period, according to Energy Innovation. That could pressure Tesla’s Energy division, which sells solar and battery energy storage systems to utilities and other clean energy project developers.
Trump told reporters at the White House on Tuesday that Musk was, “upset that he’s losing his EV mandate,” but that the tech CEO could “lose a lot more than that.” Trump was alluding to the subsidies, incentives and contracts that Musk’s many businesses have relied on.
SpaceX has received over $22 billion from work with the federal government since 2008, according to FedScout, which does federal spending and government contract research. That includes contracts from NASA, the U.S. Air Force and Space Force, among others.
Tesla has reported $11.8 billion in sales of “automotive regulatory credits,” or environmental credits, since 2015, according to an evaluation of the EV maker’s financial filings by Geoff Orazem, CEO of FedScout.
These incentives are largely derived from federal and state regulations in the U.S. that require automakers to sell some number of low-emission vehicles or buy credits from companies like Tesla, which often have an excess.
Regulatory credit sales go straight to Tesla’s bottom line. Credit revenue amounted to approximately 60% of Tesla’s net income in the second quarter of 2024.
WATCH: Threats to SpaceX & Tesla as Musk, Trump feud heats up
Amazon founder Jeff Bezos leaves Aman Venice hotel, on the second day of the wedding festivities of Bezos and journalist Lauren Sanchez, in Venice, Italy, June 27, 2025.
Yara Nardi | Reuters
Amazon founder Jeff Bezos unloaded more than 3.3 million shares of his company in a sale valued at roughly $736.7 million, according to a financial filing on Tuesday.
The stock sale is part of a previously arranged trading plan adopted by Bezos in March. Under that arrangement, Bezos plans to sell up to 25 million shares of Amazon over a period ending May 29, 2026.
Bezos, who stepped down as Amazon’s CEO in 2021 but remains chairman, has been selling stock in the company at a regular clip in recent years, though he’s still the largest individual shareholder. He adopted a similar trading plan in February 2024 to sell up to 50 million shares of Amazon stock through late January of this year.
Bezos previously said he’d sell about $1 billion in Amazon stock each year to fund his space exploration company, Blue Origin. He’s also donated shares to Day 1 Academies, his nonprofit that’s building a chain of Montessori-inspired preschools across several states.
The most recent stock sale comes after Bezos and Lauren Sanchez tied the knot last week in a lavish wedding in Venice. The star-studded celebration, which took place over three days and sparked protests from some local residents, was estimated to cost around $50 million.
Bezos is ranked third in Bloomberg’s Billionaires Index with a net worth of about $240 billion. He’s behind Tesla CEO Elon Musk at $363 billion and Meta CEO Mark Zuckerberg at $260 billion.
WATCH: Amazon CEO Jeff Bezos’ wedding sparks Venice protests
Google CEO Sundar Pichai addresses the crowd during Google’s annual I/O developers conference in Mountain View, California on May 20, 2025.
Camille Cohen | AFP | Getty Images
The Google Doodle is Alphabet’s most valuable piece of real estate, and on Tuesday, the company used that space to promote “AI Mode,” its latest AI search product.
Google’s Chrome browser landing pages and Google’s home page featured an animated image that, when clicked, leads users to AI Mode, the company’s latest search product. The doodle image also includes a share button.
The promotion of AI Mode on the Google Doodle comes as the tech company makes efforts to expose more users to its latest AI features amid pressure from artificial intelligence startups. That includes OpenAI which makes ChatGPT, Anthropic which makes Claude and Perplexity AI, which bills itself as an “AI-powered answer engine.”
Google’s “Doodle” Tuesday directed users to its search chatbot-like experience “AI Mode”
AI Mode is Google’s chatbot-like experience for complex user questions. The company began displaying AI Mode alongside its search results page in March.
“Search whatever’s on your mind and get AI-powered responses,” the product description reads when clicked from the home page.
AI Mode is powered by Google’s flagship AI model Gemini, and the tool has rolled out to more U.S. users since its launch. Users can ask AI Mode questions using text, voice or images. Google says AI Mode makes it easier to find answers to complex questions that might have previously required multiple searches.
In May, Google tested the AI Mode feature directly beneath the Google search bar, replacing the “I’m Feeling Lucky” widget — a place where Google rarely makes changes.
WATCH: Google buyouts highlight tech’s cost-cutting amid AI CapEx boom
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