Disney+’s price hikes are driving away subscribers

Disney’s latest earnings report has its executives grinning like the Cheshire Cat; the company beat analysts' expectations for earnings ($1.76/share vs. $1.45/share expected) and revenue ($24.7 billion vs. $24.6 billion expected) last quarter.

• One particular standout was Disney’s entertainment unit – including film, TV, and streaming – where revenue rose 95% compared to the year-earlier period to reach $1.7 billion.
• This increase is largely tied to the strong performance of Moana 2, which last month became the fourth Disney film in history to top $1 billion at the box office.

But it’s not all happily ever after for Disney…The entertainment giant reported a 1% decline in Disney+ subscribers, to 124.6 million, which analysts attribute to price increases that took effect in mid-October. Executives are projecting another “modest decline” in subscribers this quarter for similar reasons – though the price hikes did boost Disney’s average monthly revenue per subscriber by 4%, to $7.99.

📺🥊 The streaming war continues: Disney+’s recent subscriber decline stands in sharp contrast to Netflix, which reported a record-high 18.9 million new subs in Q4. Netflix also leads among all streaming giants in terms of subscriber churn rate, at ~1.8%/month, followed by Disney+ (4.1%), Apple TV (6.1%), and Paramount+ (6.1%).