21st Century Fox’s current film strategy is actively hurting Disney’s revenue, but the House of Mouse has a plan: nuke basically everything and start from scratch.

The decision essentially scraps everything that isn’t a major tentpole franchise — includingAvatarandPlanet of the Apes— and indie projects from Fox’s prestigious Searchlight division. Fox’s lineup of Marvel movies, including theX-Men,Fantastic Four, andDeadpoolfranchises, will now exist under Disney Studios. It’s considered a major redirection for Fox, and it comes after the studio reported a $170 million operating loss in Disney’s last quarter. It marked the first full quarter that Disney owned 21st Century Fox following the acquisition.

“One of the biggest issues was the Fox studio performance which was well below where it had been and well below where we hoped it would be when we made the acquisition,” CEO Bob Iger told investors on a recent earnings call.

Part of that slate do-over includes rebooting four popular Fox franchises that are exclusive for Disney’s upcoming streaming service, Disney+:Home Alone,Night at the Museum,Cheaper by the Dozen, andDiary of a Wimpy Kid. These will live exclusively on Disney+. The goal is to have Fox’s film divisions produce fewer movies overall or start creating specifically for Disney+.

it enters the “Streaming Wars” to compete with companies like Netflix, WarnerMedia (HBO Max), NBCUniversal, Apple, and Amazon. Iger even noted the importance of that library at the top of his opening remarks during the earnings call, saying, “The addition of original and library content from Fox will only further strengthen our direct-to-consumer offerings.”

The restructure will hopefully allow Disney to “focus on the kind of release we would hope would come out of this studio,” according to Iger. The redirected focus will also allow Disney executives to focus on bringing Fox’s content to the company’s two major streaming services, Disney+ and Hulu. Streaming is Disney’s major area of interest, especially heading into 2020 where its theatrical slate doesn’t have as many obvious blockbusters as this year’s does.

installment in the currentX-Menfranchise, only grossed $65 million at the US box office, according toVariety, despite having a $200 million budget. (To compare, most of Marvel Studios’ films over the last couple of years have grossed close to $1 billion worldwide or surpassed that threshold.)

Fox’s film slate is in desperate need of fixing, and that much is clear from Disney’s earnings call. Being able to produce fewer theatrical films and use streaming platforms like Disney+ and Hulu to their advantage seems to be the route that executives feel will be most successful. Despite Fox’s financial concerns, Iger is still convinced that spending more than $80 billion on acquiring the company was the right move.

“Nothing is more important to us than getting this right,” Iger said. “We remain confident in our strategy and our ability to successfully execute it.”

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