Tech

Disney+ grows to nearly 138 million subscribers even as profit falls despite return to parks

Disney said Wednesday that its profit fell in the recently-ended quarter, but its theme parks and streaming service Disney+ were booming.

The entertainment giant reported net income of US$470 million (about Rs.3,645 billion), just over half the profit of US$912 million (about Rs.7,075 billion) it posted in the same period last year had.

But park attendance, which had declined due to the ongoing COVID-19 pandemic, rebounded and Disney+ gained 7.9 million subscribers to 137.7 million.

If you add subscriptions to Disney’s Hulu and ESPN+ streaming services, the total surpasses 205 million.

“Our strong second quarter results, including the fantastic performance of our domestic parks and the continued growth of our streaming services, once again proved that we are in a league of our own,” said Bob Chapek, CEO of Walt Disney.

Chapek told analysts Disney is willing to increase subscription prices for streaming services in the future, but has no specific plans. Disney+ is aiming for an ad-supported version of the service to launch later in 2022.

Disney+ added more subscribers than analysts were expecting, in stark contrast to a drop in subscribers reported by rival Netflix in the first quarter of this year.

A drop of just 200,000 users — less than 0.1 percent of Netflix’s total subscriber base — sent the Silicon Valley firm’s shares plummeting and prompted one shareholder to file a lawsuit accusing the streaming TV titan of failing Having made it clear that subscriber numbers were present was a snag.

“Disney+ has brought Netflix to its knees [in the US]tech analyst Rob Enderle of the Enderle Group told AFP.

“Kids have always been chasing their content, and for parents, enlisting their service has been a breeze.”

About half of Disney+ subscribers are families with children, executives said on the earnings call.

Disney stopped licensing its coveted content to Netflix to make it exclusive to its own streaming service and said it plans to stick with the tactic when it comes to competitors in the market.

parks and politics

Disney said that as its streaming TV service continues to grow strongly, its resorts and parks are generally operating without the significant COVID-19-related capacity restrictions that were in place last year.

The pandemic continues to vex film and television production, Disney said, but it has managed to get films to theaters so far this year.

“Our plan for the rest of this year is incredibly strong,” Chapek told analysts while discussing the company’s offering of shows for streaming and theater.

Chapek acknowledged that it is difficult to release Disney films in China, saying the situation there is “very complicated” from a political and business point of view.

He said he was heartened by the fact that a newly released Doctor Strange The film, based on a Marvel comics character, grossed more than US$500 million (around Rs.3,877 billion) in its first week, even without being screened in China.

Disney has found itself caught in political turmoil closer to home when the Florida governor recently signed legislation repealing a law that for decades allowed the entertainment giant to serve as local government in Orlando, where it has a theme park.

The move was the latest in a row between the state’s Republican government and Disney, after the company criticized the passing of legislation in March banning school lessons about sexual orientation.

“Financially, Disney will have the edge when the plug is pulled,” said analyst Enderle.

“It’s almost like Florida did them a financial favor; Disney has covered all expenses of the community they are in.”

The Reedy Creek Improvement District was an area created by the Florida Congress in 1967 to facilitate the construction of Disney World in Orlando.

Under this agreement, Disney runs the county as if the entertainment juggernaut were local government, including collecting taxes and providing basic public services like garbage collection and water treatment.

Under Florida law, if the special borough is dissolved, its assets and debts would be transferred to the local governments surrounding the area.

“The district’s removal could eliminate $2 billion in debt.


https://gadgets360.com/entertainment/news/disney-q2-2022-plus-138-million-paid-subscribers-470-million-income-hulu-espn-205-million-2968260 Disney+ grows to nearly 138 million subscribers even as profit falls despite return to parks

Ryan Sederquist

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