Disney+ smashes it for House of Mouse in Q1 | Major Businesses | Business | News | Rapid TV News
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The SVOD market has just had its confirmation that there's a new 800lb gorilla in town as in reporting its first quarter results, The Walt Disney Company has revealed that Disney+ has attracted 26.5 million customers since launch in November 2019.
DIsney 13Nov2019
For the first quarter ended 28 December 2019, Disney saw revenues rise by a whopping 36% annually to reach $20.858 billion driving total segment operating income of $4.002 billion, an increase of 9% annually. The Media Networks business line was the main growth engine for Disney in the quarter, generating $ 7.361 billion and representing a rise of 24%, with segment operating income increasing 23% annually to $1.6 billion. Sub segment Cable Networks generated revenue of $4.766 billion, up 20% annually, and Broadcasting $2.595 billion, a year-on-year increase of 34%.

Direct-to-consumer & International drew $3.987 billion in its first proper year and compared with $918 million at the end of the fourth quarter of 2018. segment operating loss increased from $136 million to $693 million. The increase in operating loss was due to costs associated with the launch of Disney+, the consolidation of Hulu and a higher loss at the ESPN+ sports direct-to-consumer line.

Studio Entertainment revenues for the quarter increased from $1.8 billion to $3.8 billion and segment operating income increased from $309 million to $948 million. Higher operating income was due to increases in theatrical and TV/SVOD distribution results at legacy operations. Growth in TV/SVOD distribution results was due to sales of content to Disney+, partially offset by a decrease in pay-TV sales to third parties.

But perhaps the real story of the quarter was the huge increase for Disney in terms of SVOD and OTT subscribers. In addition to the 26.5 million for Disney+, the company ended the quarter with 6.6 million ESPN+ subs, an increase of 5.2 million over the year, and a total of 30.4 million customers for the Hulu OTT service which is now fully under Disney control. This broke down to 27.2 SVOD-only customers and 3.2 million taking live TV in addition to SVOD.

Commenting on the first quarter results, Walt Disney Company chairman and chief executive officer Bob Iger, noted the huge contribution of Disney+ to the quarter, recognising that the service had exceeded even the company’s greatest expectations. “We had a strong first quarter, highlighted by the launch of Disney+,” he said. “Thanks to our incredible collection of brands, outstanding content from our creative engines and state-of-the-art technology, we believe our direct-to-consumer services, including Disney+, ESPN+ and Hulu, position us well for continued growth in today’s dynamic media environment.”

One of the key drivers for Disney+ has been Star Wars-based live drama The Mandalorian and in a huge boost for fans, Disney+ confirmed that a new series was on the way and woudl premiere in October 2020. Series 1 became in December 2019 the most in-demand show in the world.