Recent years have been a string of successes for the Disney+ platform. The service grew in strength and the number of users increased at a dynamic pace. Back in May last year during which Disney+ gained as much as 8 million subscribers. In the third quarter, it was even better,
In turn, in June, the service (along with sister platforms Hulu and ESPN+) exceeded the number for the first time 220 million active users and practically equaled Netflix in this respect, which for years was a market hegemon
The second half of the year was not so successful for Disney+, which is confirmed by the data just released.
Disney+ is losing users. For the first time in history
The latest financial report of the American concern shows that in the last quarter of 2022, the number of Disney+ and Hotstar subscribers decreased by 2.4 million to 161.8 million. This is the first such situation in history – so far each subsequent quarter of the service ended with a net increase.
Disney+ / number of users Disney
Analysts point out that the reason behind these declines – apart from market saturation – is increase in subscription prices in the US market. It has increased from $7.99 to $10.99, but you can still use the cheaper variant – but with ads.
This is not the end of the bad news. Although – comparing year to year – the revenues of the whole streaming division Disney is up 13%. (to USD 5.31 billion), but at the same time the operating loss increased significantly – from USD 592 million to USD 1.05 billion.
Interestingly, it still generates more revenue for Disney linear television. This segment ended the last quarter with a revenue of USD 7.29 million (down 5% y/y), and operating profit decreased from USD 1.5 to USD 1.2 billion.
Overall, Disney ended the last quarter with revenue of $23.51 billion (up 8 percent) and a decline in operating profit from $3.26 billion to $3.04 billion. Net profit increased from USD 1.15 to USD 1.28 billion.
Bob Iger announces layoffs. Up to 7,000 people will lose their jobs
During a meeting with investors, Disney CEO Bob Iger (who recently returned to this position) announced that in order to increase the profitability of the streaming division, its restructuring will be necessary, which will also involve layoffs.
“I have great respect and appreciation for the dedication of our employees around the world,” said Iger during the meeting. “While it is necessary to meet the challenges we face today, I do not take this decision lightly.”
Already in November last year, the company froze new jobs. Currently Disney estimates that 7,000 people will lose their jobs as part of the job cuts.
Source: Gazeta
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