(Washington) Disney + now has 118 million subscribers worldwide, but the platform with its plethora of catalogs has seen its conquest of homes slow down, the production of new programs having suffered from the pandemic.
The service racked up an additional 2 million subscribers in three months, but investors were hoping for at least 125 million paying users at this point.
Bob Chapek, the boss of the Californian group, had warned them at the end of July that growth was going to slow down.
“I want to remind that we remain determined to achieve our goals in the long term,” he tried to reassure Wednesday during the conference call to analysts after the publication of quarterly results.
“We are confident that we are on the right track to achieve the goals announced last year of between 230 and 260 million paying Disney subscribers worldwide by the end of the year tax 2024 ”, he indicated.
Disney + launched with fanfare on November 12, 2019 in the United States, Canada, and the Netherlands. The platform won 10 million subscribers in 24 hours, and has grown at a breakneck pace since, outstripping many competitors.
Its historical catalogs (Marvel, Pixar, Star Wars, etc.) and new franchises have allowed it to follow Netflix, the pioneer of the sector, which has exceeded 213 million subscribers.
The pandemic has also helped Disney + take off, but it has delayed the production of new films and series, essential to revive consumer interest.
“We are only in the second year and the appetite for new content on the service is extraordinary. But when there is a pandemic at the same time and you have to stop production, it’s not a good combination, ”said Bob Chapek.
Cinemas versus investors
The American group, long dependent on television channels and cinemas to broadcast its content, also has difficult strategic choices to make between releasing its new films first in theaters, then on the Internet, or on both at the same time.
After “Mulan” in 2020, “Black Widow and” Jungle Cruise “were thus broadcast this summer directly on Disney”, to the chagrin of cinemas and stars like Scarlett Johansson, who deplore a shortfall for them.
Disney has made concessions. Marvel Studios’ Eternals has been in theaters for at least 45 consecutive days, as has Steven Spielberg’s’ West Side Story ‘, which will be released on December 10 in the United States.
But these decisions are not to the taste of analysts.
“When there are new films, people want to see them immediately on the platform”, comments for example Rob Enderle. “If we force them to return to the theaters, Disney + becomes useless”.
Investors also noted that the average monthly income per Disney subscriber “fell 9% in one year, to $ 4.12.
In its earnings release, the group attributed this drop to cheaper subscriptions in certain markets, such as India and Indonesia. He also notes that Disney + is facing cost increases in terms of content production, marketing and technology.
The pandemic still hangs over the enchanted kingdom
The Californian group achieved $ 18.5 billion in sales during the fourth quarter of its staggered fiscal year, and generated 160 million in net profit.
These results are without comparison with those of a year ago, when Disney recorded a net loss of more than 700 million due to the pandemic.
But the title of the entertainment empire lost more than 4% in electronic trading after the stock market closed.
The market expected better performance, especially as all the amusement parks were able to reopen this summer, thanks to vaccination campaigns.
The activity of parks and derivative products has thus doubled its turnover, to 5.5 billion dollars, “but we are still very affected by the reduced reception capacities”, because of health restrictions, according to Disney.
The group’s platforms (Disney +, ESPN + and Hulu) have 179 million subscriptions and generated sales of 4.6 billion dollars (+ 38%).
Disney recently launched a commercial offer at $ 2 for a month of Disney + membership, then $ 8 per month, to boost the growth of its number of subscribers.