{"id":337598,"date":"2020-02-05T07:04:24","date_gmt":"2020-02-05T05:04:24","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=337598"},"modified":"2020-02-05T07:05:41","modified_gmt":"2020-02-05T05:05:41","slug":"disney-nears-30-million-subscribers","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/broadcasting\/337598-disney-nears-30-million-subscribers.html","title":{"rendered":"Disney+ nears 30 million subscribers"},"content":{"rendered":"

Walt Disney Co.\u2019s crusade to become a streaming giant is off to a swift start.<\/p>\n

Subscribers to the new Disney+ online service soared to 28.6 million by early February, suggesting the company founded nearly a century ago can challenge Netflix Inc. in the crowded market for online TV. Analysts were forecasting a year-end total of 20.8 million, according to the Bloomberg Consensus.<\/p>\n

The surge marks an early success for Chief Executive Officer Bob Iger and his plan to reinvent the company. With three streaming services — Disney+, ESPN+ and Hulu — Iger has firmly steered Disney into on-demand viewing and away from conventional TV. But it\u2019s coming at a cost: Disney said fiscal first-quarter profit fell — in part due to outlays for new online movies and TV shows.<\/p>\n

Disney has seeded the new service with nearly all of its most-popular movies and TV programs, including \u201cThe Mandalorian,\u201d a \u201cStar Wars\u201d spinoff featuring the cuddly character known as Baby Yoda. Hulu, the company\u2019s streaming service for grownups, has reached 30.7 million customers, while ESPN+, its two-year-old sports service, has attracted 7.6 million subscribers. That\u2019s up from 1.4 million a year ago.<\/p>\n

\u201cI am enormously proud of what we have accomplished in a relatively short period of time,\u201d Iger said on a call with investors. \u201cWe are now well positioned to not only withstand the disruptive forces of technology, but thrive in today\u2019s increasingly dynamic media environment.\u201d<\/p>\n

Package Deal<\/h3>\n

The streaming services continue to benefit from a $13-a-month offer from Disney that includes all three products. Disney+ also has a promotional tie-in with Verizon Communications Inc.<\/p>\n

About half of Disney+ subscribers were coming through the company\u2019s website, Iger said, meaning distributors won\u2019t get a share of the revenue. About 20% came through the one-year free promotion with Verizon.<\/p>\n

Disney shares rose as much as 3.6% to $149.94 in extended trading before trimming their gain. The stock advanced 2.4% to $144.73 at the close in New York and is up almost 30% in the past 12 months.<\/p>\n

Burbank, California-based Disney said Tuesday that fiscal first-quarter earnings fell to $1.53 a share, a number that beat analysts\u2019 estimates of $1.46. Sales grew 36% to $20.9 billion in the period ended Dec. 28, slightly exceeding estimates.<\/p>\n

The drop in profit reflects costs from the company\u2019s $71 billion purchase of Fox\u2019s entertainment assets last year, as well as the ongoing investment in movies and TV shows for streaming.<\/p>\n

Streaming Losses<\/h3>\n

Disney\u2019s direct-to-consumer division, where streaming results are reported, posted a wider loss of $693 million in the quarter, although that was less than the Bloomberg Consensus forecast for a loss of $823 million.<\/p>\n

The movie division reported a stellar quarter, with profit more than tripling to $948 million, thanks to strong results from \u201cFrozen II\u201d and \u201cStar Wars: The Rise of the Skywalker.\u201d Those two films were among seven that topped $1 billion in box-office sales for the company last year. Fox\u2019s film unit, which has had a string of duds, lost $50 million.<\/p>\n

Fox\u2019s film unit, which has had a string of duds, lost $50 million, and Iger warned that Disney\u2019s 2020 film slate won\u2019t match the record set in 2019 for the studio.<\/p>\n

Profit at the theme parks division grew 8.6% in the quarter, but Disney is now facing a new threat to its tourist business from the coronavirus.<\/p>\n

Park Closings<\/h3>\n

The company has closed its Shanghai and Hong Kong park due to the outbreak. On the earnings call, Chief Financial Officer Christine McCarthy said Disney expects the Shanghai park\u00a0closure<\/span>\u00a0alone to crimp profits in the current quarter by $135 million, assuming it is shuttered for two months.<\/p>\n

With Hong Kong closing now, too, Disney expects the coronavirus to reduce profit there by another $40 million.<\/p>\n

Earnings at Disney\u2019s TV unit rose 23%, with the addition of the Fox cable networks and TV studio. That countered higher costs for sports rights and fewer subscribers at ESPN.<\/p>\n

While the company\u2019s results were strong across the board, the uncertainty of the situation in China may weigh on the shares in the short run, Dave Heger, an analyst with Edward Jones, said in an interview.<\/p>\n

\"Disney+<\/a><\/p>\n

Now read: DStv streaming service may cost the same as Netflix \u2013 Analyst<\/a><\/h3>\n","protected":false},"excerpt":{"rendered":"

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