LOS ANGELES - Walt Disney beat Netflix Inc. with a total of 221 million streaming customers and announced that it would increase prices for customers who want to watch Disney or Hulu without commercials.
In December, the media giant will increase the monthly cost of Disney without advertising by 38 per cent to US $10.99, when it begins to offer a new option that includes ads for the current price.
The shares of Disney went up 6.9 per cent after-hours trading to US $120.15 on Wednesday.
In 2017 Disney staked its future on building a streaming service to rival Netflix as audiences moved to online viewing from traditional cable and broadcast television.
Five years later, Disney has overtaken Netflix in total streaming customers. In international markets, Disney is adding new customers and it has more room to grow. The company said that Disney will offer an ad-supported version starting on December 8 for US $7.99 a month, the same price it charges for the ad-free version.
Prices for Hulu will go up by US $1 to US $2 per month in December.
Disney is projected to have between 215 million and 245 million total Disney customers by the end of September 2024. That was down from the 230 million to 260 million that Disney had predicted.
The company is losing the streaming rights for Indian Premier League cricket matches because of the reduced expectations for India.
The company still expects to turn a profit in fiscal 2024, according to McCarthy. The division lost $1.1 billion in the last quarter.
For the third quarter ended July 2, Disney posted adjusted earnings per share of US $1.09, up 0.36 per cent from a year earlier, as visitors packed its theme parks. Analysts polled by Refinitiv had expected earnings of US $0.96.
At the parks, experiences, and products division, operating income more than doubled to US $3.6 billion.
The media and entertainment unit's profit declined by 32 per cent to nearly US $1.4 billion due to streaming losses.
Revenue rose 26 per cent from a year ago to US $21.5 billion, ahead of the analyst consensus of US $20.96 billion.