The Walt Disney Company reported strong fourth-quarter earnings, with Disney+ playing a key role in boosting the profitability of its streaming business. The company highlighted a 14% growth in ad revenue for its entertainment direct-to-consumer (DTC) segment including Disney+, contributing to a significant improvement in operating income.
Disney+ Subscriber Growth
Disney+ added 4.4 million subscribers in the quarter, reaching over 120 million paid subscribers for its core service. Combined with Hulu, Disney’s DTC streaming businesses achieved a total of 174 million subscriptions.
Streaming Profitability Improves
The company’s streaming services, including Disney+, showed improved profitability in Q4, generating $321 million in operating income. This marks a significant step towards achieving the company’s long-term goal of profitability for its streaming segment. This comes as ads on Disney+, Hulu, and more saw revenue jump 14% to $253 million in the quarter.
Entertainment Segment Leads the Way
Disney’s entertainment segment, which includes Disney+, saw a significant improvement in operating income, reaching $1.1 billion in Q4. This was driven by strong ad revenue growth and improved cost management.
Other Highlights:
- Overall Revenue Growth: Disney reported a 6% increase in revenue for Q4, reaching $22.6 billion.
- Box Office Success: Pixar’s “Inside Out 2” and Marvel’s “Deadpool & Wolverine” contributed to strong box office performance.
- Experiences Segment: Disney’s parks and experiences segment achieved record revenue and operating income for the full year.
CEO’s Message:
“This was a pivotal and successful year for The Walt Disney Company, and thanks to the significant progress we’ve made, we have emerged from a period of considerable challenges and disruption well positioned for growth and optimistic about our future,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “Our solid performance in the fiscal fourth quarter reflected the success of our strategic efforts to improve quality, innovation, efficiency, and value creation. In Q4 we saw one of the best quarters in the history of our film studio, improved profitability in our streaming businesses, a record-breaking 60 Emmy Awards for the company, the continued power of live sports, and the unveiling of an impressive collection of new projects coming to our Experiences segment. As a result of our strategies and our focus on managing our businesses for both the near- and long-term, we are differentiating ourselves from traditional competitors, leveraging the deepest and broadest set of entertainment assets in the industry to drive attractive returns and further advance our goals.”