Disney+ adds 2.1 million subscribers in quarter to October 2

Wednesday, November 10th, 2021 
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BURBANK, Calif. — The Walt Disney Company (NYSE: DIS) today reported earnings for its fourth quarter and fiscal year ended October 2, 2021.

Bob Chapek, Chief Executive Officer, The Walt Disney Company: “As we celebrate the two-year anniversary of Disney+, we’re extremely pleased with the success of our streaming business, with 179 million total subscriptions across our DTC portfolio at the end of fiscal 2021 and 60% subscriber growth year-over-year for Disney+. We continue to manage our DTC business for the long-term, and are confident that our high-quality entertainment and expansion into additional markets worldwide will enable us to further grow our streaming platforms globally.”

Direct-to-Consumer

Direct-to-Consumer revenues for the quarter increased 38% to $4.6 billion and operating loss increased from $0.4 billion to $0.6 billion. The increase in operating loss was due to higher losses at Disney+, and to a lesser extent, ESPN+, partially offset by improved results at Hulu.

The higher loss at Disney+ was due to higher programming and production, marketing and technology costs, partially offset by increases in subscription and Premier Access revenues. Higher subscription revenue reflected subscriber growth and increases in retail pricing. Higher Premier Access revenue was due to two releases in the current quarter, Black Widow and Jungle Cruise, compared to one release in the prior-year quarter, Mulan. The increases in costs and subscribers reflected the ongoing expansion of Disney+.

Lower results at ESPN+ were due to higher marketing and sports programming costs, partially offset by subscription revenue growth. The increase in subscription revenue was due to subscriber growth and, to a lesser extent, an increase in retail pricing.

The increase at Hulu was due to subscription revenue growth and higher advertising revenue, partially offset by increases in programming and production and, to a lesser extent, marketing costs. Subscription revenue growth was due to an increase in subscribers and higher rates driven by an increase in retail pricing for the Hulu Live TV+ SVOD service in December 2020. Higher advertising revenue was primarily due to increased impressions. The increase in programming and production costs was driven by higher subscriber-based fees for programming the Live television service due to rate increases and an increase in average monthly subscribers.

The following table presents the number of paid subscribers[1] (in millions) for Disney+, ESPN+ and Hulu as of:

                      2021       2020
                 October 2  October 3  Change
                 ---------  ---------  ------
Disney+[2]           118.1       73.7    60 %
ESPN+                 17.1       10.3    66 %
Hulu
 SVOD Only            39.7       32.5    22 %
 Live TV + SVOD        4.0        4.1   (2) %
Total Hulu[3]         43.8       36.6    20 %

The following table presents the average monthly revenue per paid subscriber[4] for the quarter ended:

                      2021       2020
                 October 2  October 3  Change
                 ---------  ---------  ------
Disney+          $    4.12  $    4.52   (9) %
ESPN+            $    4.74  $    4.54     4 %
Hulu
 SVOD Only       $   12.75  $   12.59     1 %
 Live TV + SVOD  $   84.89  $   71.90    18 %

The average monthly revenue per paid subscriber for Disney+ decreased from $4.52 to $4.12 due to a higher mix of Disney+ Hotstar subscribers in the current quarter compared to the prior-year quarter.

The average monthly revenue per paid subscriber for ESPN+ increased from $4.54 to $4.74 due to an increase in retail pricing, partially offset by a higher mix of subscribers to the bundled offering.

The average monthly revenue per paid subscriber for the Hulu SVOD Only service increased from $12.59 to $12.75 due to a lower mix of wholesale subscribers and increases in per-subscriber premium add-on and advertising revenue, partially offset by a higher mix of subscribers to the bundled offering. The average monthly revenue per paid subscriber for the Hulu Live TV + SVOD service increased from $71.90 to $84.89 due to an increase in retail pricing and higher per-subscriber advertising and premium/ feature add-on revenue, partially offset by a higher mix of subscribers to the bundled offering.

1. Reflects subscribers for which we recognized subscription revenue. Subscribers cease to be a paid subscriber as of their effective cancellation date or as a result of a failed payment method. Subscribers to the bundled offering in the U.S. are counted as a paid subscriber for each service included in the bundle (Disney+, Hulu and ESPN+). Star+ in Latin America is offered as a standalone service or along with Disney+. If a subscriber has either the standalone Disney+ or Star+ service or both the Disney+ and Star+ services, they are counted as one Disney+ paid subscriber. When we aggregate the total number of paid subscribers across our DTC services, whether acquired individually, through a wholesale arrangement or via the bundle, we refer to them as paid subscriptions.
2. Includes Disney+ Hotstar and Star+. Disney+ Hotstar launched on April 3, 2020 in India (as a conversion of the preexisting Hotstar service), on September 5, 2020 in Indonesia, on June 1, 2021 in Malaysia, and on June 30, 2021 in Thailand. Disney+ Hotstar average monthly revenue per paid subscriber is significantly lower than the average monthly revenue per paid subscriber for Disney+ in other markets. Star+ launched in Latin America on August 31, 2021.
3. Total may not equal the sum of the column due to rounding.
4. Revenue per paid subscriber is calculated based on the average of the monthly average paid subscribers for each month in the period. The monthly average paid subscribers is calculated as the sum of the beginning of the month and end of the month paid subscriber count, divided by two. Disney+ average monthly revenue per paid subscriber is calculated using a daily average of paid subscribers for the period. Revenue includes subscription fees, advertising (excluding revenue earned from selling advertising spots to other Company businesses) and premium and feature add-on revenue but excludes Premier Access and Pay-Per-View revenue. The average revenue per subscriber is net of discounts on bundled services. The bundled discount is allocated to each service based on the relative retail price of each service on a standalone basis. In general, wholesale arrangements have a lower average monthly revenue per paid subscriber than subscribers that we acquire directly or through third party platforms like Apple.

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