Disney’s Streaming Services Mark First Profitable Quarter, and the Future of Subscription-Based Entertainment Looks Bright

Disney Plus and Hulu announced their first profitable quarter today, marking a significant turnaround from last year’s loss. In Disney’s earnings report released on Tuesday, the company revealed that both streaming services made $47 million combined this past quarter. This is a huge milestone for Disney as it continues to invest more in streaming.

Disney CEO Bob Iger highlighted the success of their streaming business during the earnings call, emphasizing that streaming will be a key growth driver for the company moving forward. Despite some losses, Disney Plus added 7.9 million subscribers in the US and Canada over the past few months, bringing total subscribers to 54 million. The company launched its combined Disney Plus and Hulu app in March and plans to integrate ESPN Plus into the app as well.

During the earnings call, Iger announced that an ESPN Plus tile will be added to Disney Plus this fall, providing subscribers with access to select live games and studio programming within the app. The growth of its ad-supported tier could have played a role in turning around its streaming business. Disney launched the $7.99 per month option in December 2022 and has been encouraging subscribers to opt for this tier.

Hugh Johnston, Disney’s chief financial officer, mentioned during the earnings call that the company’s partnership with cable provider Charter helped drive the growth of its ad-supported tier, ending the quarter with 22.5 million subscribers. Additionally, Disney has plans to launch a standalone ESPN streaming service in the fall of 2025, along with a dedicated sports streaming service in partnership with Warner Bros Discovery and Fox launching later this year.

Overall, Disney’s first profitable quarter marks an important milestone for its streaming business as it continues to grow and expand its offerings.