In today’s world, having a strong presence in streaming services is crucial for any entertainment business, as it leads to intense competition to claim the title of best streaming service. For Disney, which offers Disney+, Hulu, and ESPN+, maintaining a competitive edge is especially vital. Surprisingly, despite losing 700,000 subscribers from Disney+ in the last quarter, Disney remains optimistic about this outcome. The reason behind their positivity lies in the fact that although its flagship platform experienced a decrease in subscribers, Hulu saw a significant increase instead, ultimately balancing out the situation for the corporation.
This morning, The Walt Disney Company disclosed its first-quarter results for fiscal year 2025, and it was accompanied by the announcement that Disney+ and ESPN+ each dropped approximately 700,000 subscribers in the last quarter. However, Hulu added 1.6 million new subscribers, resulting in a favorable outcome for the corporation overall. During Disney’s Q1 earnings conference, Bob Iger stated that after the recent price increase, the company had anticipated losing even more subscribers than it actually did, making the current numbers a positive sign. He elaborated on…
We’re really happy with our current position regarding Disney+ and Hulu. Despite increasing prices quite recently, we anticipated a higher rate of subscribers leaving (churn). However, the numbers we got were better than expected. Consequently, the subscription base for both Disney+ and Hulu saw a slight but positive growth in the last quarter.
In October 2024, around mid-month, the cost for a Disney+ subscription increased. The basic ad-supported plan now requires a monthly payment of $10, whereas the ad-free version will set you back $16. Additionally, both plans can be purchased as bundles along with Hulu and ESPN+.
Regular price hikes are common in the streaming world, and all platforms understand this. The rise in prices is partially intended to offset any loss of subscribers. While retaining more subscribers than anticipated might not seem like a significant advantage, it does mean that Disney is currently earning more from its subscription base than initially projected. In fact, streaming proved profitable for Disney during the last quarter.
Disney operates as a publicly-owned business, so its primary goals are to make a profit and increase that profit from one quarter to the next. Everything else is secondary. During their latest earnings discussion, analysts raised concerns about subscriber losses and Disney’s approach to curbing password sharing, but there was no sense of urgency or alarm in the conversation.
Disney has indicated that they don’t anticipate substantial growth for Disney+ in the upcoming quarter, but there’s a strong possibility that subscribers will return once shows like Daredevil: Born Again premiere and movies such as Moana 2 and Mufasa: The Lion King make their debut on the platform.
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2025-02-05 21:09