Home TV Disney Beats Earnings Estimates On The Cusp Of Streaming Launch

Disney Beats Earnings Estimates On The Cusp Of Streaming Launch

SHARE:

Disney posted solid results Thursday for its fiscal fourth quarter with $19.04 billion in quarterly revenue, beating expectations of $19.1 billion. The company also announced that Hulu is now the official streaming home for FX Network content.

But the company’s earnings call would have been a lot more interesting if it took place five days from now, on Nov. 12. That’s the day Disney’s direct-to-consumer streaming product, Disney Plus, will launch.

Investors were champing at the bit for any color they could get on the service. Disney CEO Bob Iger didn’t give up much.

Anything to share on early sign-ups?

No specifics were on offer, and presales are “still relatively small,” but “consumers were drawn to the marketing messages we had out there,” Iger said. (A study released last week by analytics company Jumpshot suggests that pre-launch sign-ups for Disney Plus may already top 1 million.)

What about plans for further third-party distribution for Disney Plus, say via pay TV operators?

“We’re certain the apps will be made available in most traditional app-selling stores or platforms,” Iger said.

How much will Disney make on wholesale arrangements, like the one it has with Verizon to give its subscribers a year of free access to Disney Plus?

“The deal is positive for us from an economic perspective,” Iger said. “We’re not just giving it away, we’re getting paid a certain amount for it, but I’m not getting into specifics.”

Iger did drop a few interesting tidbits, though, on streaming advertising opportunities.

Hulu, which now has approximately 28.5 million subscribers, is a “significant driver” of advertising revenue, Iger said, even more so than ESPN Plus (which hit nearly 3.5 million subs in Q4), and that will continue as Hulu grows its subscriber count.

Subscribe

AdExchanger Daily

Get our editors’ roundup delivered to your inbox every weekday.

“Ad-supported Hulu has a very high ARPU [average revenue per user], which is one of the reasons it’s being bundled with ESPN Plus and Disney Plus for the $12.99 price,” Iger said. “The value of an ad-supported Hulu subscriber, given the advertising revenue it drives, is very, very high.”

But despite Disney’s obsessive focus on its own streaming distribution platforms, it’s also sticking with its multichannel video programming distributor (MVPD) partners.

MVPDs “are still very important to us, valuable to us and, I think, quite viable as well,” said Iger, who told investors that AT&T and Disney have reached “a deal in principle” to keep Disney channels available across AT&T TV NOW and DIRECTV.

Despite “continued erosion” in traditional pay TV, Iger said there’s still a benefit to these partnerships, and Disney doesn’t have to sacrifice data access to strike them. Disney can still get “a significant amount of user data” when people access Disney apps through an MVPD.

Long term, though, the trend is toward people wanting fewer channels, which isn’t so good for MVPDs. But it’s great for streaming apps. “That’s where the apps business can benefit,” Iger said.

Must Read

Google in the antitrust crosshairs (Law concept. Single line draw design. Full length animation illustration. High quality 4k footage)

Google And The DOJ Recap Their Cases In The Countdown To Closing Arguments

If you’re trying to read more than 1,000 pages of legal documents about the US v. Google ad tech antitrust case on Election Day, you’ve come to the right place.

NYT’s Ad And Subscription Revenue Surge As WaPo Flails

While WaPo recently lost 250,000 subscribers due to concerns over its journalistic independence, NYT added 260,000 subscriptions in Q3 thanks largely to the popularity of its non-news offerings.

Mark Proulx, global director of media quality & responsibility, Kenvue

How Kenvue Avoided $3 Million In Wasted Media Spend

Stop thinking about brand safety verification as “insurance” – a way to avoid undesirable content – and start thinking about it as an opportunity to build positive brand associations, says Kenvue’s Mark Proulx.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters
Comic: Lunch Is Searched

Based On Its Q3 Earnings, Maybe AIphabet Should Just Change Its Name To AI-phabet

Google hit some impressive revenue benchmarks in Q3. But investors seemed to only have eyes for AI.

Reddit’s Ads Biz Exploded In Q3, Albeit From A Small Base

Ad revenue grew 56% YOY even without some of Reddit’s shiny new ad products, including generative AI creative tools and in-comment ads, being fully integrated into its platform.

Freestar Is Taking The ‘Baby Carrot’ Approach To Curation

Freestar adopted a new approach to curation developed by Audigent that gives buyers a priority lane to publisher inventory with higher viewability and attention scores than most open-auction inventory.