Just days after HBO Max owner Warner Bros. Discovery (WBD) lifted the lid on its latest set of streaming results, Disney followed suit with its own quarterly earnings report (opens in a new tab ).
The entertainment giant unveiled its flagship streaming property, Disney Plus, which attracted 12,1 million new subscribers between July and September this year, bringing the platform's global total to 164,2 million. Hulu and ESPN Plus also added more paying customers, leaving House of Mouse heading into Christmas with an industry-best subscriber pool of 235 million.
By comparison, WBD's entire portfolio, which includes HBO, HBO Max and Discovery Plus, currently serves just under 95 million subscribers, having amassed just 2,8 million new customers during the prior quarter. Netflix added even fewer subscribers (2,4 million) during the same period, but the streamer's global number remains the highest at 223 million.
Of all the major streaming services, Disney Plus continues to grow at the fastest rate. Still, there's still a ways to go to usurp Netflix, which appears to have rebounded from back-to-back declining quarters in 2022, as the biggest platform in the industry.
Also, subscriber growth does not automatically equate to profit. Despite the positive reading of its customer numbers, Disney's fourth-quarter results (the company is working in a different fiscal year than Netflix and HBO Max) actually confirmed a $1470 billion annual loss. That's nearly double the losses Disney suffered in 2021.
However, CEO Bob Chapek is confident that Disney Plus will be profitable sooner rather than later, and he's proud of how far the streaming service has come in such a short time.
"The rapid growth of Disney Plus in just three years since its launch is a direct result of our strategic decision to invest heavily in creating incredible content and rolling out the service internationally," Chapek told investors. "We expect our DTC operating losses to narrow going forward and Disney Plus to still achieve profitability in fiscal 2024, assuming we don't see a material change in the economic climate."
Between June and September 2022, Disney Plus subscribers were treated to a host of new movies and TV shows that obviously increased the streamer's appeal to new customers. In the last three months alone, Obi-Wan Kenobi, She-Hulk: Attorney at Law, Pinocchio, Hocus Pocus 2, and Andor have released on Disney's streaming platform.
With the company's selection of new Star Wars TV shows, top-tier Marvel movies, and other non-franchise offerings set to grow even larger in the coming years, Disney Plus subscribers are in for a good feed for some time to come. weather.
Value added
Disney expects the imminent launch of an ad-supported subscription tier on Disney Plus to help sustain the streaming service's impressive growth. “By realigning our costs and leveraging the benefits of Disney Plus's price increases and our ad-supported tier beginning December 8, we believe we will be on the path to a profitable streaming business that will drive continued growth and create value for shareholders for a long time. the future,” Chapek said.
According to the Wall Street Journal (opens in a new tab), Disney's new, cheaper subscription plan will limit ads to four minutes per hour of content and completely limit ads when viewed by young children through user profiles. customized for platform kids.
This approach follows that of HBO Max, which launched its own cheaper subscription package in June last year to surprising popularity. Netflix also launched an ad-supported plan in November 2022, though subscribers didn't appreciate its early implementation.
Clearly, the heads of Disney are making all the right moves to ensure that Disney Plus keeps pace with Netflix and continues to leave HBO Max in the dust (at least on paper). The company's recent acquisition of the overseas broadcast rights to Doctor Who will also bolster its fortunes.
Watch out, Ted Sarandos: the House of Mouse is coming for your crown.
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