Just a day earlier, Disney announced a price hike across all its streaming platforms
Disney $DIS reported on Wednesday that its streaming business, which includes Disney+, Hulu, and ESPN+, turned a profit for the first time during its third fiscal quarter of 2024. The news comes as the media giant’s traditional TV assets continue to struggle.
Disney now joins Netflix $NFLX and Warner Bros. Discovery in being one of the few media companies to operate a profitable streaming business.
Disney said its streaming platforms’ operating income rose 108% to $42 million in the three months ending June 30, compared with a loss of $512 million during same period in 2023.
“This was a strong quarter for Disney, driven by excellent results in our entertainment segment both at the box office and in [direct-to-consumer], as we achieved profitability across our combined streaming businesses for the first time and a quarter ahead of our previous guidance,” said Disney CEO Bob Iger in a press release.
The company had previously anticipated to turn a profit in this division in its fourth fiscal quarter.
Disney is aiming to build on the past quarter’s profits with recently announced bundles, price hikes, and some tech updates for Disney+.
In a Wednesday call with investors, Iger said that the company’s current goal is to grow user engagement on its streaming services. He said that this will be done via both new content — such as box office hits Inside Out 2 and Deadpool and Wolverine, and additional upgrades, including an improved recommendation algorithm and playlists.
He told investors, “by adding all of these features both on the technological side and also on the programming side we’re bullish about the future of this business.”
Disney also reported a slight year-over-year increase in paid subscribers for Disney+ and Hulu. Paid subscriptions for Disney+ rose 1% to 118 million year over year and Hulu subscriptions grew 2% to 51 million.
However, Disney continues to struggle with its traditional television assets, which include its broadcast network ABC; and its cable channels Disney Channel, National Geographic, and FX.
The company reported that its operating income from the linear networks fell 6% to $966 million in its third fiscal quarter, from $1 billion in the same quarter in 2023.
Warner Bros. Discovery is also dealing with the same problem and its CEO David Zaslav is reportedly looking into separating its streaming and studio assets from its struggling cable network business.
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.
