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The Rundown: Disney+ tops 152 million subscribers, but growth slows in the U.S.

In exactly the same quarter that Netflix lost subscribers and NBCUniversals Peacock saw stagnant subscriber growth, Disneys Disney+ saw subscriber growth accelerate in the quarter that ended July 2. But, the media companys flagship streaming service did see subscriber growth slow in the U.S., and its own two other streaming services ESPN+ and Hulu also saw subscriber growth slow in the time.

Nonetheless, Disneys final number of streaming subscriptions reached 221 million, Disney CEO Bob Chapek said through the companys quarterly earnings call yesterday. Its unclear whether that figure means Disney having surpassed Netflixs 220.7 million subscriber base, since Disneys number concerns subscriptions, not unique subscriber accounts, and could include multiple subscriptions from exactly the same account holder.

The main element numbers:

  • $21.5 billion altogether revenue, up 26% year over year
  • $7.2 billion in revenue from linear TV networks, up 3% year over year
  • $5.1 billion in revenue from direct-to-consumer streaming services, up 19% year over year
  • 152.1 million subscribers to Disney+, up 10% from the last quarter
  • 22.8 million subscribers to ESPN+, up 2% from the last quarter
  • 46.2 million subscribers to Hulu, up 1% from the last quarter

Disney+

Disney+s global subscriber additions in the most recent quarter outstripped all of its main rivals that use quarterly subscriber numbers. Whereas Disney+ added 14.4 million subscribers in the time, Netflix lost 970,000 subscribers; Warner Bros. Discovery added 1.7 million subscribers across HBO, HBO Max and Discovery+; Paramount+ added 3.7 million subscribers and Peacock stayed flat.

However, in the U.S., Disney+ did come across a subscriber slowdown. The streamer only added 100,000 domestic subscribers in the time, when compared to 1.5 million U.S. subscribers it added in the last quarter.

Disney+ ad-supported tier and price increase

Not coincidentally, on a single day it reported the U.S. subscriber slowdown, Disney announced the launch date and pricing because of its upcoming ad-supported tier, that is likely to help the business gain cost-conscious subscribers. However, the ad-supported tiers pricing might not so much help Disney gain subscribers as keep its existing subscribers, who could be unwilling to consent to the services impending price increase.

Disney+ Basic will debut on Dec. 8 and cost $7.99 monthly, which is just how much Disney+s ad-free tier currently costs. With the help of the ad-supported tier, the ad-free tiers price increase to $10.99 monthly, that could cause visitors to cancel their subscriptions, particularly if the economic depression persists. However, we usually do not believe there’s likely to be any meaningful long-term effect on our churn because of the pricing increase, Chapek said through the earnings call.

Disney+ subscriber growth forecast

Disney updated its subscriber guidance for Disney+. Previously, the business said it expected Disney+s subscriber base to be between 230 million and 260 million subscribers by the finish of its fiscal-year 2024. Now, the business is separating its projections because of its core Disney+ service and its own Disney+ Hotstar service, that is targeted at the Indian market.

Disney expects to possess 135 million to 165 million core Disney+ subscribers by the finish of fiscal-year 2024, which Disney finance chief Christine McCarthy said through the earnings call was largely in keeping with previously provided guidance. Meanwhile, Disney+ Hotstar is likely to have around 80 million subscribers by the finish of fiscal-year 2024, which seems to mark a 15 million-subscriber downgrade from the prior projection. The downward revision likely is due to Disney losing streaming rights for the Indian Premier League.

Broader subscriber slowdown

Disney+ isnt the only person of Disneys streaming services to see subscriber growth ebb. Hulu turned in another quarter of 1% sequential subscriber growth, and ESPN+s subscriber growth subsided a little from 5% in the last quarter to 2% in the most recent one.

Furthermore, Hulus streaming pay-TV service lost subscribers for another quarter. After losing 200,000 subscribers in the initial 90 days of 2022, Hulus pay-TV service shed another 100,000 subscribers in the newest three-month period.

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