Saturday, April 13

Disney + does not work out the accounts: it gains more subscribers than expected but loses more and more money

Disney announced the latest Disney+ results with a bittersweet taste: increased its number of subscribers by 14 million, great news because the expected figure was also only 10 million. However, despite this increase above expectations, he announced a price increase for the United States. Subscriptions 37% more expensive, and also adding advertising between content (four minutes for each hour of content) for those who choose to keep the current price.

The mismatch comes because the increase in subscribers has not translated into an increase in profits: the only thing that has increased is their losses. And also above their expectations: 1,100 million lost compared to 300 million that they expected to leave behind. A too severe correction for its good registration figures.

All three Disney services outperform Netflix

Why so many losses? By aggressive spending on content, marketing, and technology infrastructure far in excess of revenue, even with subscriber figures that, two years after its launch, are approaching market leadership. Only in content will spend 30,000 million dollars in 2022.

If Disney sees this expense as an investment that will be able to return steadily in the future, these losses will only be temporary clouds. If instead they are expenses that need to become structural to maintain subscriber numbers, the business is in danger. Netflix already had to deal with that problem.

At the moment, price increases are coming in the United States, possibly as a preview of what will come to regions like Europe, with the euro in free fall against the dollar and double-digit inflation in countries like ours.

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Three animated series as fast-paced as they are brief and refreshing to devour in one go

One of the readings is Disney, combining its three streaming video services (Disney+, Hulu and ESPN+) already has 221 million subscribers. A million more than Netflixwho is accusing riding alone against competitors who do not seem to have too many problems.

Disney grows in users above their expectations at the cost of a record investment that leaves it in losses

Apple TV + continues without increasing its prices or announcing layoffs; the same as Prime Video. HBO, for its part, is cutting the HBO Max catalog… to announce its subsequent merger with Discovery+. They all have a mattress, also Disney+, but not Netflix.

And another positive reading for the company of Mickey Mouse: the threat of a recession and high inflation is not reducing the number of families that travel to its theme parks. On the contrary: this division has invoiced 7,400 million dollars in the last quarter with a profit of 2,200 million.

Last year, still with the vaccination campaigns underway but with a much better outlook than in 2020, it stood at 4.3 billion billed and a profit of “only” 356 million. Not only because of the increase in tourism thanks to the fact that the pandemic was already being left behind, but also because of details such as a greater human flow in the parks that allows more sales to be made. fast pass to skip the lines, for example. On many days there are more visitors in a Disney park than in 2019. Now it remains that your service streaming accompany you, not only in your user figures, but also in your balances.

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