Hulu content will soon be added to the Disney+ streaming app.
Disney shares are down about 5.0% in after-hours trading.
Follow Invezz on Telegram, Twitter, and Google News for instant updates >
Walt Disney Co (NYSE: DIS) is trading down in extended hours after reporting a decline in the number of subscribers on its flagship streaming platform in Q2.
Disney+ lost 4.0 million subscribers to end the second financial quarter with 157.8 million subscribers – well below 163.5 million that experts had forecast.
Are you looking for fast-news, hot-tips and market analysis?
Sign-up for the Invezz newsletter, today.
On the plus side, though, the said decline was related only to Disney+Hotstar while its core streaming service continued to add subscribers in the recently concluded quarter.
Also a positive was the operating loss from its direct-to-consumer business that contracted about 26% to $659 million. On Yahoo Finance Live, Third Bridge analyst Jamie Lumley said:
Disney is in a period of transition. Cutting costs down is a top priority. That’s moving in the right direction.
Remember that CEO Bob Iger is aiming to lower costs by a whopping $5.5 billion. To that end, he recently said the company will cut about 7,000 jobs before summer – and further layoffs in the future may not entirely be off the table, as per Lumley.
Also on Wednesday, the entertainment and mass media company said it will soon integrate the Hulu content into its Disney+ streaming app. Third Bridge’s Lumley noted:
It’s been challenging having Disney+ and Hulu be separate. From a branding and marketing perspective, there are challenges to having multiple platforms with different focal points and audiences.
However, it still remains unclear if Disney will choose to own 100% of Hulu moving forward, he added. CEO Bob Iger also revealed plans of lifting the price of ad-free subscription later this year today.
Disney shares are up more than 8.0% for the year at writing.
Earned $1.49 billion versus the year-ago $597 million
Per-share earnings also climbed from 26 cents to 69 cents
Adjusted EPS printed at 93 cents as per the press release
Revenue jumped nearly 8.0% year-on-year to $21.82 billion
Consensus was 93 cents a share on $21.8 billion in revenue
Disney brought in $14.04 billion from media and entertainment distribution (its largest business) versus $14.15 billion expected.
DTC sales printed at $5.51 billion in Q2 – up from $4.9 billion last year but missing consensus estimates by some $50 million. $7.78 billion from theme parks and product sales came in better than expected.
Copy expert traders easily with eToro. Invest in stocks like Tesla & Apple. Instantly trade ETFs like FTSE 100 & S&P 500. Sign-up in minutes.
81% of retail CFD accounts lose money
Get demo account
Leisure & entertainment