The Walt Disney Company is an American icon. Unfortunately, it is entwined both in America’s culture battles and in the tariff wars of President Donald Trump.
On Wednesday of this week, Disney’s stock topped $100 for the first time in over a month. The company reported very strong revenues and earnings for its quarter ending in March. Wall Street analysts and investors were worried about the quarter on concerns that the economy was slipping into recession as a result of Trump’s tariffs. Consumer confidence is very weak.
Financial markets were also worried because international tourism to the United States is in steep decline in response to Trump’s policies and rhetoric. Investors were also looking for signs that the Disney franchise is being damaged by America’s cultural polarization. After all, Disney’s most recent film rendition of the classic fairy tale Snow White was a financial disaster because the movie was viewed as pandering to diversity, equity, and inclusion policies.
All of these fears proved to be unfounded. Disney reported better-than-expected numbers for all divisions: parks and experiences, the entertainment division, including streaming, and its sports media operations. Disney is firing on all cylinders.
A surprise of the quarterly earnings release was the announcement that Disney will partner with Miral, an Abu Dhabi-based company, to create a theme park in the United Arab Emirates. The new park, Disney’s seventh, will likely become a must-see destination for travelers from the Middle East, India, and many other countries. Disney is not only an American icon but also one of the dominant consumer franchises of the world economy.
What gets lost in Trump’s tariff policies is that the U.S. runs a large trade surplus in services and intellectual property. Importantly, the U.S. film industry runs a trade surplus.
This trade surplus is a large offset against America’s deficit in tradable goods. Unfortunately, Trump never talks about these positive aspects of global trade. Moreover, U.S. companies dominate the international market. Our technology giants, our pharmaceutical companies, our global banks, and our consumer brands such as Disney, Coca-Cola, and McDonald’s are preeminent businesses in the world economy. U.S. multinationals generate annual revenues of over $8 trillion in overseas markets. These international revenues of U.S. companies dwarf the annual trade deficit in goods of $1 trillion.
The interconnected global economy truly benefits the citizens of the U.S. Trump is wrong to say that America is being taken for a ride. Rather than trying to disconnect the U.S. from the global economy, Trump should be working to strengthen the bonds among the countries that value capitalism and democratic values.
Disney’s investment in the Middle East will embed American culture in the strategically important geography of the global economy. The countries of the Middle East are the low-cost producers of oil and natural gas, two essential power sources for the smooth running of global commerce. Through Disney, the U.S. can project soft power. This is a good thing.
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It is true that Disney pandered to the far Left during the administration of former President Joe Biden. But under the renewed leadership of CEO Bob Iger, the company is now focusing on its paramount duty, serving the interests of its shareholders. The board of directors at Disney has a legal obligation to maximize value for shareholders. Iger and his board are doing their jobs. Disney is returning to its roots.
In turn, Trump should recognize that companies such as Disney strengthen America’s economic position. He should pivot from his myopic focus on trade deficits and see the big picture. He should strive to promote American culture, which values entrepreneurism, civility, and a strong regard for democratic values.
The writer owns shares in Disney.
James Rogan is a former U.S. foreign service officer who has worked in finance and law for 30 years. He writes a daily note on the markets, politics, and society. He can be reached at [email protected].