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Disney+ Global Subscriber Base Approaches 130 Million; Costs Increase Too

The Walt Disney Company Feb. 9 said its branded subscription streaming video service, Disney+, ended the first quarter (Jan. 1, 2022) with 129.8 million paid subscribers worldwide, including 42.9 million in North America. That compared with 94.9 million and 36.3 million in North America during the previous-year period. Disney+ launched on Nov. 12, 2019.

International subscribers increased 40% to 41.1 million, from 29.4 million, excluding Disney + Hotstar in India. The Indian segment saw 57% subscriber growth to end the period with 45.9 million subs — the largest market segment for Disney+. The platform, which Disney acquired in the 20th Century Fox deal, ended the previous-year period with 29.2 million paid subs.

ESPN+ increased its paid subscriber base 76% to 21.3 million, from 12.1 million. Hulu saw its base increase 16% to 40.9 million, from 35.4 million last year. Combined with online TV platform Hulu + Live TV, total Hulu subs topped 45.3 million, up from 39.4 million the year before.

Disney said it remains on track to reach 230 million to 260 million global Disney+ subs by the end of fiscal 2024.

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“We’ve had a very strong start to the fiscal year with a significant increase in total subscriptions across our streaming portfolio to 196.4 million,
including 11.8 million Disney+ subscribers added in the first quarter,” CEO Bob Chapek said in a statement.

Direct-to-consumer revenue for the quarter increased 34% to $4.7 billion and operating loss increased 27% to $600 million. The increase in operating loss was due to higher losses at Disney+, and to a lesser extent, ESPN+, partially offset by improved results at Hulu.

Lower results at Disney+ reflected higher programming and production, marketing and technology costs, partially offset by an increase in subscription revenue. Higher subscription revenue was due to subscriber growth and increases in retail pricing. The increases in costs and subscribers reflected growth in existing markets and to a lesser extent, expansion to new markets.

Lower results at ESPN+ were driven by higher sports programming costs, partially offset by subscription revenue growth and higher income from Ultimate Fighting Championship (UFC) pay-per-view events. The increase in subscription revenue was due to subscriber growth and, to a lesser extent, an increase in retail pricing. The increase in income from UFC pay-per-view events was due to higher revenue per event, partially offset by the impact of one less event in the current quarter compared to the prior-year quarter.

The increase at Hulu was due to subscription revenue growth, partially offset by higher programming and production costs. Subscription revenue growth was due to an increase in subscribers and higher rates driven by increases in retail pricing for the Hulu + Live TV service. The increase in programming and production costs was primarily due to higher subscriber-based fees for programming the Live TV service due to rate increases and the carriage of more networks.

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