Last Tuesday (8), Disney+ released its financial report for the fourth quarter of fiscal 2022. Despite the platform having gained 12.1 million new subscribers and The Walt Disney Company remains the market leader in accounts payers, streaming faced a loss of US$ 1.5 billion in the period. Even with losses, the company already has plans for recovery.
Leader in number of subscribers since August 2022, when it hit the global mark of 221 million users (combining Disney+, Star+ and Hulu) and surpassed NetflixDisney has struggled not to lose its reign in streaming.
The company revealed in its letter to investors which, in the last fiscal quarter, gained 14.6 million new subscriptions. This number now leads it to have no less than 236 million customers on the three services combined.
Disney+ alone, with its 12.1 million new subscribers, already represents an increase of 3 million over analysts’ forecasts. Which shows that, at least in the dispute to retain the audience, Disney has managed to prove that it knows very well how to play the game.
Disney+ lost last quarter
Despite the excellent results in numbers of paying users, Disney+ suffered from losses in the analyzed period. While streaming already predicted an operating loss of $0.8 billion, it actually posted a loss of $1.5 billion for the quarter.
Among the reasons given for the financial hole are the higher production and technology costs that the platform had to bear, in addition to an increase in marketing expenses. Another point raised was also the end of the Premier Accesswhich was still in effect in the same period analyzed last year and helped to bring more profitability to the platform.
For those who don’t remember, the Premier Access, was a feature made available by Disney+ during part of the pandemic. In it, for a fee charged separately, the subscriber could watch movies that were still in the cinema.
To give you an idea, in that same quarter in 2021, titles like Black Widow and Jungle Cruise were in Premier Access while on the big screen. This allowed subscribers who didn’t want to go to a session away from home, the opportunity to see them in the comfort of their own home, paying an extra fee.
New plan and price increase arrive in December
As measures to reduce its financial losses, Disney+ will increase the price of its platform and launch an ad plan. These changes that for now are restricted to the US and will arrive in December for its subscribers.
In practice, this means that in the US the price of your current plan (without ads) will increase by 38%, reaching a value of US$ 10.99. Meanwhile, the yet-to-be-released ad plan will cost $7.99 a month.
The decisions had already been announced in the last quarter letter to investorsbut were reinforced in this new presentation by Bob Chapek, CEO of Walt Disney.
According to Chapek, the news should put Disney+ on a better financial path, so the company expects to reach profitability in fiscal 2024.
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