Disney - strong results in spite of audience dip

15 May 2023

Disney reported mixed results for the quarter. The good: streaming losses fell to 659M from the previous quarter’s 1.1B, whereas streaming revenues rose +12% to 5.5B. Crucially ARPU (average revenue per user) rose 20%in the US and ~6% internationally — it’s a case of squeezing actual profit out of users rather than scaling the business at all costs — this is the new “raison d’etre” of streamers globally, as heralded by WBD CEO Zaslav a few quarters ago — like in Jerry Maguire, “show me the money”.

And now for the bad: total users fell to 157M from 161M — this was mostly due to Disney+Hotstar, an Indian subscription service — it was mostly an outlier; users lost ex Hotstar sat in the hundreds of thousands.

The ugly: linear (“trad”) TV revenues fell 7%, largely due to the increased cost of sports rights and declining advertising revenues. We’ve seen this across the board – WBD and Paramount saw the same.

See upside here as +$130 and downside as +$80 for the year. Read more at: research.blackbull.com/disney-still-showin-magic/