Disney just announced its upcoming pricing plans for its streaming service — Disney+.
©Disney
During the earnings call for the first quarter of fiscal year 2025 (held on February 5th), Disney announced that Disney+ was a huge success during the first quarter of 2025. Additionally, Disney CFO Hugh Johnston confirmed that there will be no Disney+ subscription price increases for the next 12 months. Here’s what you need to know.
The Walt Disney Company reported earnings for its first fiscal quarter, which ended December 28th, 2024. While the Company commented on everything from its Experiences business to its Entertainment division, we’re going to focus on the Disney+ streaming data.
Disney+
Disney+ falls into the Entertainment segment of The Walt Disney Company. For the first fiscal quarter, this segment’s operating income increased by $0.8 billion to $1.7 billion. In terms of the Direct-to-Consumer financial contributions (and losses), operating income went from $431 million to $293 million.
©Disney
The number of paid Disney+ subscriptions decreased this quarter, falling to 125 million Disney+ subscribers, a decrease of 0.7 million from last quarter. That said, the total amount of Hulu subscriptions rose 3% to 53.6 million. Despite the loss of subscribers, Disney+’s average monthly revenue per paid subscriber increased from $7.70 to $7.99 due to increases in pricing.
Hulu sign in Disney’s Hollywood Studios
In Disney’s international market, the Disney+ average monthly revenue per paid subscriber increased from $6.78 to $7.19 due to increases in pricing and higher advertising revenue. Disney expects a “modest decline” in subscribers for the upcoming quarter.
©Disney
Disney CFO Hugh Johnston recently told CNBC that Disney+ pricing will steadily increase over a period of years, but Disney does not have plans to dramatically increase its prices. In fact, current pricing is expected to be in place for the next 12 months. Johnston stated that Disney “has found the right balance in what we need to invest for quality content.”
©Disney
Disney CEO Bob Iger then commented on changes Disney hopes to make to its streaming service. Iger stated that the home screen for Disney+ has to be “dynamic.” Iger believes the home screen, while attractive, is too “static.” Iger also confirmed that technological enhancements are already rolling out and will be rolling out through the rest of the year. He cited password sharing, more curation (serving the consumer what the consumer wants), ad tech improvements, AI enhancements, and ESPN flagship development.
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Iger also commented on the opportunity to make room for news output — both ABC and local stations — on Disney+, adding, “It will continue to be a part of our offering.”
Regarding news in streaming, Iger speaks positively about the opportunity to make room for news (both ABC and local stations) on streaming.
— Disney Food Blog (@DisneyFoodBlog) February 5, 2025
Overall, Disney’s streaming business reported a mostly successful quarter. While Disney+ saw a decline in subscribers, recent price increases led to profitability. According to Disney CFO Hugh Johnston, who spoke with CNBC on February 5th, Disney+ continues to be a “stronger and stronger service.” Johnston pointed to the success of the Disney+ Hulu bundle and noted that consumers see Disney+ as a “must-have service.”
©Disney
This news comes after some teasing from Disney that they were looking at price increases for their streaming service. At the previous earnings call (in November of 2024), Hugh Johnston, CFO of The Walt Disney Company, said, “We certainly look to continue to increase pricing based on the value we’re providing.”
It’s arrived!
Disney+ has seen its fair share of cancelations as well. It’ll be interesting to see just how the service continues to develop in the future. We’ll be keeping an eye out for more updates, so stay tuned for all the latest news.
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