ESPN is Losing Subscribers Faster Than Ever as Cord Cutting Grows






During Disney’s Q1 2020 earnings call yesterday, the company was enthusiastic about the subscriber growth for Disney+, Hulu, and ESPN+. All three streaming services owned by Disney exceeded expectations. However, when it came to cable networks, the news wasn’t as positive.

ESPN reported that subscribers dropped 4.5% in Q1 2020. Previously, the loss was 4.0% in Q4 2019 and 2.5% in Q3 2019.

Disney acknowledged the loss in ESPN revenue in their first quarter earnings report, citing an increase in costs and lower viewership.

The decrease at ESPN was due to an increase in programming and production costs and lower advertising revenue, partially offset by higher affiliate revenue. Higher programming and production costs were driven by rate increases for NFL, College Football Playoffs and other college sports programming as well as costs for the ACC Network, which launched in August 2019. The decrease in advertising revenue was due to lower average viewership. Affiliate revenue growth was due to an increase in contractual rates, partially offset by a decrease in subscribers. The decrease in subscribers was net of the impact of the ACC Network.

Overall, Disney’s cable networks saw a revenue increase of 20% for the quarter.

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