May 8, 2019
Disney CEO Bob Iger May 8 confirmed the existence of discussions with Comcast about the possible acquisition of the cabler’s 33% stake in Hulu and Hulu with Live TV online platform.
Disney owns 66% of Hulu following its $71.3 billion acquisition of select 21st Century Fox assets and WarnerMedia selling its 10% ownership stake.
Speaking on the fiscal call, Iger didn’t disclose additional details except to say Disney remained mindful of its fiduciary duty to keep Comcast in the loop on Hulu activities, including global expansion and content licensing.
“There has been dialog with Comcast about them possibly divesting their [Hulu] stake, and you can expect that if that were to occur, there would probably be some ongoing relationship as a result of [shared] programming,” Iger said, adding that any expansion of the service abroad would have to be done with Comcast’s cooperation.
“We’re bullish about Hulu for a number of reasons, but mostly because we see it as the best consumer television proposition out there,” he said.
While Disney invests heavily in the ramp-up of subscription streaming video platform Disney+, it remains proactive about Hulu – despite the service’s ongoing fiscal drain.
Indeed, Disney “Direct-to-Consumer & International” business segment, which includes Hulu, Disney+ and ESPN+, saw revenue for the quarter increase 15% to $955 million and segment operating loss increase from $188 million to $393 million.
The increase in operating loss was due to ongoing investment in ESPN+, which was launched in April 2018, costs associated with Disney+, a loss from the consolidation of Hulu and higher losses from streaming technology services (formerly BAMTech), partially offset by an increase at International Channels.
As a result, upon the closing of the Fox transaction, Disney recorded a one-time gain of $4.9 billion as a result of remeasuring its initial 30% interest in Hulu to fair value.