Discovery gets boost from DTC business with 11MN subs in flat fiscal year | Major Businesses | Business
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As it reported generally disappointing financial results for the quarter and year ended 31 December 2020, content giant Discovery has revealed the extent to which its discovery+ direct-to-consumer service has proved ito be a hit just after a month since launch in the US.
DiscoveryPlus 3Dec2020
For the fourth quarter, the company posted total revenues of $2.886 billion, flat compared with the prior year quarter, in terms of both reported and ex-FX. US advertising revenues were also flat and distribution revenues increased 5%, while non-US advertising revenues decreased 1% and distribution revenues decreased 4%, both ex-FX. Net income was $271 million and EPS was $0.42 per diluted share. Total adjusted OIBDA decreased 9% to $1.002 billion, or decreased 8% ex-FX.

For the full year, total revenues were $10.671 billion, falling 4% on an annual basis on both a reported and ex-FX basis. During the year US advertising revenues decreased 5% and distribution revenues increased 4%. However, non-US advertising revenues saw a marked fall of 12% and distribution revenues decreased 3%, both ex-FX. Net income for the year was $1.219 billion. However, total adjusted OIBDA decreased 10% to $4.196 billion, a decrease of 9% ex-FX.

Yet while the company’s fiscal 2020 was mixed, Discovery expressed clear optimism for 2021 driven by its discovery+ direct-to-consumer service. Even though it launched in select markets as late as December 2020 and only in the US on 4 January 2021, Discovery called the service a success revealing that it had already surpassed 11 million total paying subscribers globally and that it was on pace to be at 12 million by the end of the month.

This growth underscored the value of the investments Discovery had made in content, “beloved” personalities and brands with huge consumer appeal, supported by industry-leading DTC capabilities said Discovery president and chief executive officer David Zaslav. Commenting on the 2020 results as a whole, he said: “2020 was a year of change, challenge, and opportunity, and our company has shown incredible resilience, creativity and focus as one global team. We finished with strong operating momentum and great command and control across our global businesses, uniquely positioning us to balance our core and next generation businesses. Our unmatched global scale and ability to serve consumers everywhere with a truly differentiated offering across platforms…position us to achieve sustainable long-term growth and drive long-term shareholder value."