Disney provided its first subscriber count for Disney+, the streaming video service it launched in November, and it’s off to an impressive start.
The company said in its earnings release that Disney+ ended the fiscal first quarter with 26.5 million subscribers. On the ensuing call, CEO Bob Iger said the service has 28.6 million subscribers as of Monday, February 3.
Iger said subscribers have been signing up directly, through Verizon (which is offering a free year of Disney+ to some of its subscribers) and through distributors including Apple and Roku. He also said that conversions from free to pay and churn rates are better than Disney expected.
Disney+ will launch March 29 in India through Disney’s Hotstar streaming service, which the company acquired through its deal with Fox. The company expects the next phase of growth for Disney+ to come from international markets and that more substantial domestic growth for the service won’t come until later this year when anticipated content like the Marvel series launch.
Disney also provided subscriber updates for ESPN+ and Hulu. ESPN+ has 7.6 million subscribers as of Monday, up from the 6.6 million the company reported in its earnings release.
Hulu has 30.7 million subscribers as of Monday, up from 30.4 million in the earnings release. The company said 27.2 million subscribers take Hulu’s SVOD service only and another 3.2 million subscribe to the SVOD and the live TV service. Disney said Hulu with Live TV had 1.7 million subscribers one year ago.
Disney’s direct-to-consumer and international segment revenues for the quarter rose from $0.9 billion to $4 billion and segment operating loss increased from $136 million to $693 million. The company attributed the increase in operating loss to costs associated with the launch of Disney+, the consolidation of Hulu and a higher loss at ESPN+. Next quarter, the company expects the streaming business will generate a $900 million operating loss.
The company said average monthly revenue per paid subscriber for ESPN+ decreased from $4.67 to $4.44 and for Hulu from $14.49 to $13.15, which resulted from both services being offered at reduced rates in a service bundle with Disney+.
However, average monthly revenue per paid subscriber for our Hulu Live TV + SVOD service increased from $52.31 to $59.47 thanks to price increases.