Huge losses for Disney + in Fourth QuarterBusiness News

February 08, 2024 11:30
Huge losses for Disney + in Fourth Quarter

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In the last quarter of 2023, Disney+ experienced a decline of 1.3 million subscribers due to a significant increase in prices. However, the streaming business managed to reduce its losses by $300 million during the period of October to December. According to Disney's quarterly earnings report released on Wednesday, the number of Disney+ Core subscribers, which includes customers from the United States, Canada, and international users (excluding India-based Disney+ Hotstar), decreased from 112.6 million to 111.3 million compared to the previous quarter.

In their financial statements, covering the first quarter of fiscal year 2024, Disney anticipates gaining between 5.5 million and 6 million subscribers to Disney+ Core by the end of the current quarter, which spans January to March. On the other hand, Disney+ Hotstar witnessed an increase of 700,000 subscribers during the October-December quarter, reaching a total of 38.3 million subscribers from the previous 37.6 million recorded at the end of September. These results indicate the first growth for Disney+ Hotstar since the loss of 12.5 million subscribers last year due to a change in strategy, moving away from low-profit customers and the loss of sports rights in the region.

Overall, at the end of 2023, Disney had a combined total of 149.6 million streaming subscribers across both services, slightly lower than the previous quarter's total of 150.2 million. Disney experienced a boost in its streaming-only subscriptions, going from 43.9 million to 45.1 million. Additionally, their Live TV + SVOD option gained an additional 4.6 million subscribers. Starting in early December, Disney+ began incorporating Hulu content into its platform. The initial introduction of Hulu on Disney+ was followed by the planned launch of a more integrated version in March 2024. Disney has stated that they are on track to achieve profitability in their streaming business by the end of their current fiscal year. This is supported by a reduction of $300 million in losses in Q1 compared to Q4. During the quarter, Disney reported a cost savings of $500 million. They are confident in meeting or surpassing their goal of $7.5 billion in annualized savings by the end of fiscal 2024. The quarter's free cash flow amounted to $886 million.

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