Disney began this year with close to 146.4 million paid subscribers to its steaming services.
As of January 2, Disney+, which includes Disney+ Hotstar in India and Indonesia, accounted for 94.9 million, up from 26.5 million as of December 28, 2019.
ESPN+, on the other hand, had 12.1 million (+83%) and Hulu 39.4 million (30%). Hulu’s total was made up of SVOD only at 35.4 million (+30%) and live TV and SVOD at 4 million (+25%). Significantly, Disney+’s ARPU fell by 28% between the two dates, from $5.56 to $4.03. This was in part due to the inclusion of Disney+ Hotstar, which has a significantly lower ARPU in India and Indonesia. Meanwhile, ARPU for Disney+ increased by 1%, from $4.44 to $4.48 due to an increase in retail pricing, partially offset by a higher mix of subscribers to the bundled offering available in the US.
ARPU for the Hulu SVOD Only service increased from $13.15 to $13.51 due to higher per-subscriber advertising revenue, a lower mix of wholesale subscribers and an increase in per-subscriber premium and feature add-on revenue. These increases were partially offset by a higher mix of subscribers to the bundled offering. ARPU for the Hulu Live TV + SVOD service increased from $59.47 to $75.11 due to increases in retail pricing, higher per-subscriber advertising revenue and an increase in per-subscriber premium and feature add-on revenue. These increases were partially offset by a higher mix of subscribers to the bundled offering.
Disney notes that DTC revenues for the quarter increased 73% to $3.5 billion and operating loss decreased from $1.1 billion to $466 million. The decrease in operating loss was due to improved results at Hulu, and to a lesser extent, at Disney+ and ESPN+.
The improvement at Disney+ was driven by an increase in subscribers, partially offset by higher programming and production cost amortisation and increased marketing and technology costs. The increases in subscribers and costs reflected the ongoing expansion of Disney+ including launching in additional markets. The current quarter included three months of Disney+ operations whereas the prior-year quarter included two months.
Commenting on the results, Bob Chapek, CEO, The Walt Disney Company, said: “We believe the strategic actions we’re taking to transform our Company will fuel our growth and enhance shareholder value, as demonstrated by the incredible strides we’ve made in our DTC business, reaching more than 146 million total paid subscriptions across our streaming services at the end of the quarter.
“We’re confident that, with our robust pipeline of exceptional, high-quality content and the upcoming launch of our new Star-branded international general entertainment offering, we are well-positioned to achieve even greater success going forward”.
