The entertainment colossus behind the Magic Kingdom and all
its entertainment wonders saw subscriptions at its streaming services surge to
more than 146 million subscribers, as people hunkering down due to the pandemic
have turned to sources of online entertainment.
The audience growth for Disney+, Hulu, ESPN and India's
Hotstar comes as the parent company's travel and amusement park business
suffered, and shows the entertainment giant is gaining ground on leading
streaming service Netflix's 203 million subscribers.
"We're confident that, with our robust pipeline of
exceptional, high-quality content and the upcoming launch of our new
Star-branded international general entertainment offering, we are
well-positioned to achieve even greater success going forward," Disney
chief executive Bob Chapek said in an earnings release.
The growth of Disney's streaming services, with the bulk of
the audience made up of the 95 million subscribers who joined Disney+ since it
launched about a year ago, trounced expectations.
Disney+ alone added 21.2 million paid subscribers in the
final quarter of last year, according to the earnings report.
The entertainment giant is prioritizing exclusive
programming, original shows and movies, as well as bundled streaming services
to build on the momentum of its various offerings, which extend beyond Disney+
to include ESPN, Hulu and Hotstar.
Hit launches at Disney+ at the end of last year included an
animated film "Soul" that combined comedy and drama with a message
about finding the spark that gives life meaning.
The quarter also featured a new season of original Star Wars
spin-off series "The Mandalorian."
Disney has played to the strengths of its Pixar, Marvel and
Star Wars teams, as well as its own studio content at the streaming service.
"Disney+ has been a massive success and is a testament
to Disney's brand equity and expertise in storytelling," said eMarketer
analyst Eric Haggstrom.
"This has been one of the most successful consumer
product launches in recent memory."
The analyst expected Disney streaming services to continue
growing, and that its parks, television and movie businesses will recover
quickly as Covid-19 vaccines are administered and pent-up demand is unleashed.
Tending to talent
The pandemic hit Disney's parks and experiences unit
hardest, with the company's resorts closed or operating at reduced capacity and
its cruise ships idle, according to executives.
Revenue in that unit plunged more than 50 percent, turning
it from a big profit engine to a loss on the balance sheet.
Film and television production has also been disrupted by
the pandemic, although much of it resumed in the recently ended quarter, the company
reported.
Disney anticipated an additional billion dollars in costs
this year associated with government regulations and safety measures for
"employees, talent and guests" as a result of the health crisis.
The company also did not release any new films to theaters
in the quarter, but stressed anew that it expected to return to debuting movies
in cinemas.
Revenue in the quarter fell 22 percent to $16.25 billion but
beat market expectations. Disney reported profit of $17 million compared with
$2.1 billion in the same period a year earlier.
Disney shares were up three percent in after-market trades
that followed release of the earnings figures.
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