2023-08-10 00:03:29
The Walt Disney Group logo on the New York Stock Exchange, August 7, 2017. RICHARD DREW / AP
Disney+, Disney’s streaming platform launched with fanfare at the end of 2019, lost subscribers for the third consecutive quarter, according to results published on Wednesday August 9, but the Californian group has promised to turn the corner this summer and improve its profitability.
This is not the only concern of the group, faced with a strike of scriptwriters and actors as well as mediocre receipts in cinemas and on television channels, its traditional channels.
On Wednesday, Disney released mixed quarterly results for the April-June period – $22.3 billion in revenue, up slightly year-on-year but slightly below analysts’ expectations – and announced a price hike for Disney+.
The monthly subscription to the platform, without , will thus increase from 11 to 14 dollars in October in the United States, double the initial price four years ago. “We had already increased our prices in 2022”recalled Bob Iger, the boss of the company, during a conference call on Wednesday. “And we hadn’t seen any significant drop in subscribers, which was heartening. »
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The company has also planned to tighten the screw in 2024 on the sharing of passwords between users to prevent them from enjoying content for free.
This method allowed Netflix to see its number of subscribers jump in the second quarter. The industry pioneer has more than 238 million worldwide, compared to 146 million for Disney+.
The loss of Indian Championship cricket rights
From the end of September to the end of June, the platform lost 18 million subscribers in all, mainly due to the Indian market. Hotstar, the local version of Disney, weighs almost a third of the world total, but it has lost the rights to broadcast the national cricket championship.
In North America, the service recorded a slight drop of 1% in the number of subscribers, the second consecutive one. But this summer, the number of Disney+ subscribers, excluding India, “will rebound in the United States and internationally”promised Kevin Lansberry, acting chief financial officer.
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Bob Iger was also pleased that 3.3 million people have subscribed to the subscription with advertisements since its launch at the end of last year.
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In financial terms, the streaming activity remains loss-making, but it continued to reduce its operating losses over the quarter, to 512 million dollars instead of 1 billion last year at the same period.
” It’s encouraging “commented Paul Verna of Insider Intelligence, “but that’s mostly due to massive layoffs and lower spending on content, rather than real growth”.
Disney also saw its sales of films and programs to cinemas and television channels decrease by 7% over one year, to $6.7 billion. The business’ operating profit plunged 23% to $1.9 billion.
Only revenue from amusement parks, cruises and related products increased substantially, by 13%, to $8.3 billion.
Strike and job cuts
On Wall Street, Disney shares initially fell in electronic trading following the close of trading on Wednesday, but rose nearly 3% following price hike announcements.
Under the leadership of boss Bob Iger, Disney has undertaken to make savings this year, in particular by eliminating 7,000 jobs and reducing content production.
Strikers outside Disney studios on the occasion of the hundred days of social movement, August 9, 2023 in Burbank, California. VALERIE MACON / AFP
Recalled to the helm at the end of 2022, Mr. Iger, 72, had previously led the company from 2005 to 2020. The group’s board of directors voted unanimously in July to extend his contract until the end of 2026.
But the iconic leader has waned in popularity in recent months. He is facing a historic strike: the actors joined the screenwriters in mid-July to demand an increase in their remuneration, at half mast in the era of streaming, and want to obtain guarantees once morest the use of artificial intelligence (AI ).
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Requirements “unrealistic”according to Bob Iger, shouted down at protests in Los Angeles and New York. “Nothing is more important to this company than its relationship with the creative community, actors, writers, directors and producers”he said on Wednesday, before committing “personally to work to find solutions”. In the meantime, the strike will allow Disney to save money, said Kevin Lansberry, since the studios are spending less.
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