Paolo Pescatore, an analyst at PP Foresight, said that “the journey is somewhat similar to the trajectory of Netflix. So expect more bumps ahead and more losses in the streaming business, as there is no silver bullet for profitability”.
Disney’s net income from continuing operations increased 1% to $162 million. Disney earned 30 cents a share, missing Wall Street’s target of 55 cents a share.
Revenue of $20.15 billion in the July-September quarter also fell short of the consensus estimate of $21.25 billion. Disney amassed 235 million subscriptions across streaming services Disney+, Hulu and ESPN+, an increase of 14.6 million from the previous quarter. Hulu recorded 47.2 million subscribers and ESPN+ 24.3 million.
In a conference call with analysts, CFO Christine McCarthy said the streaming unit’s operating results will improve by at least $200 million. in the first quarter of fiscal year 2023 compared to the fourth quarter of fiscal year 2022.
The ad-supported version of the Disney+ service will launch in the United States on December 8, providing a new source of revenue to defray the billions the company spends creating original movies and series for the services.
Tim Nollen, an analyst at Macquarie Research, estimated that the ad slot could bring in an additional $800 million in ad sales next year.
Source: Ambito
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