Disney adds streaming subscribers, but cuts long-term goals

Ignoring concerns about a slowdown in the streaming industry, Walt Disney added 14.4 million new subscribers to its Disney Plus service in the most recent quarter, pushing its total paid streaming customers to 221 million — slightly more than Netflix.

but disney It lowered its long-term guidance for its total number of Disney Plus subscribers due to the recent loss of the rights to broadcast Indian Premier League cricket. Total subscribers won’t reach 260 million by 2024, and company officials now expect Disney Plus to reach 245 million, they said Wednesday.

However, Disney is sticking with its goal of making Disney Plus profitable by 2024.While Wall Street used to cheer Disney and its rivals for investing heavily in new products stream media To attract new subscribers, investors are now focusing on how the company will turn a profit.

The streaming business lost $1.1 billion in Disney’s third quarter, more than triple the $293 million loss a year earlier.

To turn a profit, Disney said it would raise U.S. prices for its streaming services, including Hulu and ESPN Plus, later this year, a move that would coincide with a new ad-supported version of the service.

The new details come as Disney reported strong third-quarter results, driven in part by surging crowds at its theme parks in the U.S. and France, where visitor numbers have surpassed pre-coronavirus pandemic levels despite rising inflation s level.

Disney CEO​​​ Bob Chapek Said the park’s strong performance was partly due to “pent-up demand,” but added that the rebound was “more resilient and durable” than a short-term recovery from the pandemic.

Revenue for the quarter rose 26% year over year to $21.5 billion, while net income rose 53% to $1.4 billion. Disney earned $1.09 per share, beating Wall Street expectations of 96 cents.

The result is a boost for Chapek, whose contract was renewed this summer just months after Disney responded to Florida. controversial law Limit discussions of sexuality or gender identity to elementary school.

“I’m very pleased with our performance this quarter,” Chapek highlighted the growth of the theme park business and its streaming services.

The entertainment industry has been shaken this year after Netflix revelations lost subscribers, sparking concerns that the potential market for streaming is smaller than investors thought. Earlier this month, Warner Bros. Discovery announced a strategic shift away from the emphasis on subscription streaming services. Like Disney, Netflix has announced plans for an ad-supported service in an effort to attract more cost-conscious consumers.

In June, Disney lost an auction for the broadcast rights to an IPL cricket match that has been an engine of Disney Plus subscriber growth. Chapek on Wednesday defended a “disciplinary decision” not to bid for the rights, which were sold to Viacom18 for $3 billion.

Disney shares rose 6.6% to $119.90 in after-hours trading in response to its financial results. The stock is down nearly 30% this year.

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