August 4, 2020
Disney’s aggressive marketing of a branded direct-to-consumer (DTC) video package featuring Disney+, ESPN+ and Hulu has resulted to a subscriber base topping 100 million, CEO Bob Chapek Aug. 4 disclosed on the media giant’s third-quarter (ended June 27) earnings report.
Disney ended the period with 57.5 million Disney+ subs, 8.5 million ESPN+ subs, 32.1 million Hulu subs and 3.4 million Hulu with Live TV subs. The data would suggest sub growth at Disney+ has cooled since attracting 54.5 million subs by May 4.
Disney attributed ESPN+ subscriber growth and higher income from Ultimate Fighting Championship pay-per-view events. The platform, together with Hulu and Disney+, has been bundled for $12.99 monthly and less.
“[This is] a significant milestone and a reaffirmation of our DTC strategy, which we view as key to the future growth of our company,” Chapek said in a statement.
The milestone comes as DTC revenue topped $3.9 billion, up 2% from revenue of $3.8 billion in the previous-year period. Through nine months of the fiscal year, DTC revenue tops $12.1 billion compared with $5.9 billion in the prior-year period, and before the launch of Disney+ on Nov. 12, 2019.
While revenue increases in DTC, so do costs, at the expense of operating income. The segment reported a loss of $706 million, up 25% from an operating loss of $562 million in the previous-year period. Through nine months of the fiscal year, DTC operating losses have topped $2.2 billion, from $1 billion a year ago.
“Despite the ongoing challenges of the pandemic, we’ve continued to build on the incredible success of Disney+ as we grow our global direct-to-consumer businesses,” Chapek said.