Disney+ Lost An Unbelievable Number Of Subscribers, Streamer In Trouble?
For the first time, Disney+ has reported losing customers, with the streamer down 2.4 million subscriptions.
Disney+ lost 2.4 million subscribers in the last three months of 2022. The figure, which was the streamer’s first notable decline since its launch in 2019, was revealed by CEO Bob Iger during an earnings call with analysts. The drop was driven by a 3.8 million decline in the version of the streaming service in India and parts of Southeast Asia.
Known as Disney+ Hotstar, the service was down to 161.8 million subscribers at the end of 2022. The membership decline in the region can be attributed to the entertainment giant losing the streaming rights to Indian Premier League cricket matches. This blow prompted the company to lower growth targets for Disney+ Hotstar in India, Variety reports.
In the United States and Canada, Disney+ gained approximately 200,000 subscribers to reach 46.6 million. Hulu attracted 800,000 people in the last quarter, bringing its membership to 48 million. And ESPN+ increased its paying viewers by 600,000 to 24.9 million. Disney’s direct-to-consumer revenue rose by 13 percent to $5.3 billion. However, its operating losses increased by 78 percent to $1.05 billion.
Despite the significant loss of Disney+ subscribers, Chief Financial Officer Christine McCarthy said the company was pleased with the initial reaction to the ad-supported Disney+ tier. Although the service debuted across America in early December, she said a meaningful financial impact will not be seen until later this fiscal year.
Bob Iger noted that while the price of core Disney+ increased from $7.99 to $10.99 per month, the entertainment outfit only suffered a minimal loss of subscribers as a result. He also suggested that previous attempts to rapidly expand the streaming service placed too much emphasis on acquiring customers when the focus should have been on profitability.
“We were, as a company, in a global arms race for subscribers,” he said via Variety. “And in our zeal to go after subscribers, I think we might have gotten a bit too aggressive in terms of our promotion, and we are going to take a look at that.” Away from Disney+, the company’s linear television networks saw a revenue drop of five percent.
Fortunately, Disney generated better results from theatrical distribution led by Black Panther: Wakanda Forever. This was good news compared to losses on some Marvel titles released in the prior-year quarter. The Parks, Experiences, and Products group also experienced a revenue climb of 21 percent to $8.7 billion and an operating income rise of 25 percent to $3.1 billion.
Disney+ still faces several challenges going into 2023. The biggest would be tackling the crowded streaming marketplace, which has forced other services, including HBO Max and Showtime, to purge their catalogs to save costs. This was evidenced by the brutal cancellation of the almost-complete Batgirl movie.
So far, Disney+ hasn’t reported any cancellations. However, The Direct says the studio plans to delay more than half of its Marvel originally slated for a 2023 release. This includes the second season of What If…?, plus X-Men ’97 and Agatha: Coven of Chaos. The delays come as Disney places a larger focus on quality over quantity amid internal criticism of Phase Four.
