In his latest results, Disney said it added 14.4 million subscribers to Disney+ during the third fiscal quarter, bringing the total number of subscribers to 152.1 million, more than the 147 million analysts had expected. However, at the same time, its direct-to-consumer division, which includes streaming units, lost more money than in previous years. According to Disney, rising production costs for Disney+ and rising sports programming costs for ESPN+ contributed to the losses.
Along with reporting revenue results and more streaming customers than expected, Disney announced it was raising the price of its ad-free streaming service by 38%. Disney+ will cost $10.99 per month, up from its current price of $7.99 per month. The rise begins on December 8 in the United States
Disney will soon include an ad-supported $7.99 per month tier as Disney attempts to restructure its pricing options.
Disney is also raising the price of Hulu subscriptions. The ad-free tier will drop from $12.99 per month to $14.99, while the ad-supported version will cost $7.99 per month, down from $6.99 per month. The new pricing will come into effect in October. A price hike for ESPN+ streaming was announced in July, raising the monthly price from $6.99 per month to $9.99.
Disney Stocks (SAY) are down 28% since the start of the year.
“Disney is in the rare position of being able to grow Disney+ subscribers and raise prices without worrying too much about customer churn. Netflix, on the other hand, is losing subscribers after a series of price hikes. That said, Disney still needs its theme park business to post stronger growth if it is to convince investors that its best days are ahead of it,” said Caleb Silver, editor of Investopedia.