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Disney adds 7.9m subscribers in Q2, details 500 originals on international slate

Disney’s streaming platform Disney+ added 7.9 million subscribers in the second quarter to reach roughly 137.7 million globally, beating analyst estimates and indicating that it is not yet experiencing the same subscriber acquisition challenges as rival Netflix.

Bob Chapek

Disney+ now has 44.4 million subscribers in the US and Canada, up from 37.3 million a year ago. Internationally (excluding its Disney+ Hotstar service in India), it has 43.2 million subs, while Disney+ Hotstar has 50.1 million.

With the subscriber additions, Disney+ remains on course to reach its target of between 230 million and 260 million by fiscal 2024, said Disney. The service’s geographical footprint is also set to significantly expand in the near term as it prepares to launch in more than 50 new markets before the end of Q3.

It should be noted that the Indian version of the service was a major driver of its subscriber additions in Q2. Of the 7.9 million subs added, a “little over half” were for Disney+ Hotstar, which attracted a large number of sign-ups due to the start of the new Indian Premier League cricket season, said Disney’s chief financial officer Christine McCarthy.

The outlook remains promising in the back half of the year, said Disney execs, with the company expecting to add more subscribers in the third and fourth quarters than it did in the first and second, the equivalent of at least 19.9 million new subs.

During the investor call, CEO Bob Chapek and McCarthy also discussed the enormous slate of international programming being developed and produced across the company.

Chapek said Disney currently has around 500 local original titles in various stages of development and production, with 180 set to be released this fiscal year and 300 the following year. Of the 500 projects, McCarthy said 140 are from Asia, 150 from EMEA, 100 from India and 200 from Latin America.

The mammoth slate is coming at a hefty cost though. Disney reported an operating loss of US$887m in its direct-to-consumer segment in Q2, up from a loss of US$290m a year ago.

Overall, the company now has 205 million streaming subscribers across its three D2C offerings, Disney+, Hulu and ESPN+.

With 205 million subscribers globally, Disney is closing in on Netflix’s 221.6 million. However, that total is not quite a like-for-like comparison, as subscribers to Disney’s three-product bundle (Disney+, Hulu and ESPN+) are counted three times.

The release of Disney’s Q2 earnings comes around three weeks after Netflix posted its first subscriber losses in more than a decade and said it expected to lose a further two million in the coming quarter. With its subscriber growth slowing, Netflix last month revealed its intention to introduce an ad-supported tier to its service.

Disney, which unveiled its own plans to introduce an AVoD tier on Disney+ in March, will be able to hit the ground running, said Chapek, given the experience and infrastructure it has built up around AVoD-SVoD service Hulu in the US.

“We believe it’s good for the consumer because it’s going to give us another entry price point, but it’s also going to be great for the advertisers,” said Chapek.

“Our advertisers, increasingly, are looking for multiple platforms to [gain] a broader reach and we think that, as a company, we’re going to provide that, given our portfolio with streaming and our linear networks.”


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