Disney+ ended the quarter with 157.8 million subscribers, losing 4 million subscribers in the first three months of 2023.
Wall Street analysts had instead forecast, for the last three months, 163.17 million subscribers.


Subscriber losses

This second consecutive quarterly decline for the platform, which ended 2022 with its first-ever decline, was driven by 4.6 million (about 8%) declines in subscribers on Disney+ Hotstar , the version of the service offered in India and in parts of Southeast Asia.

Recall that last year, Disney lost the streaming rights to Indian Premier League (IPL) cricket matches, leading to curtailing Disney+ Hotstar ‘s growth targets in India.

In the US/Canada, Disney+ lost approximately 300,000 subscriptions (topping 46.3 million), while adding nearly 1 million in international markets excluding Disney+ Hotstar .

Hulu earned 200,000 subscriptions in the quarter to 48.2 million, while ESPN+ increased by 400,000 to 25.3 million.


During Disney ‘s earnings call on Wednesday, Chief Executive Officer Bob Iger announced that Hulu content will be introduced on Disney+ later in the year with a “one-of-a-kind experience.”

Disney will also continue to offer Disney+, Hulu and ESPN+ as standalone options. Iger explained:

“This is a logical progression of our DTC offerings that will open up more opportunities for advertisers while also giving bundle subscribers access to more robust and streamlined content, resulting in more audience engagement and ultimately most unified streaming experience.
Combining Disney+ content with overall entertainment is a very strong pairing from a subscriber perspective, from a subscriber acquisition and retention perspective, and also from an advertiser perspective.”

Iger added that Disney ‘s purchase of Comcast ‘s stake in Hulu is not yet “completely determined,” but cordial and constructive talks have taken place. Starting in January 2024, both companies may use options to allow Comcast to sell its stake.

Content removal

The company is reportedly considering a content writedown of between $1.5 and $1.8 billion in the third quarter.

Also on the call, Chief Financial Officer Christine McCarthy announced that Disney :

“It is overhauling the content of our DTC services to align with strategic changes to our approach to content curation.

As a result, we will be removing some content from our streaming platforms and expect to incur an impairment of approximately $1.5-1.8 billion.

The charges, which will not be recorded in our segment results, will be recognized primarily in the third quarter, when we complete our review and remove content.”

Content spending cuts will hit the hardest in 2024. McCarthy didn’t specify which shows will be cut, though the news sparked obvious concerns about a repeat of what happened with HBO Max .

McCarthy also said that:

“We intend to produce lower volumes of content in the future in line with this strategic shift.”

Iger said the plan is for Disney to get “a lot more surgical on what we produce.”

The platform recently canceled both Willow and National Treasure , after just one season each.

In particular, the company is intent on producing and marketing content that can actually tip the balance in terms of subscribers. Iger states that:

“When you produce a lot of content, everything has to be promoted. A lot of money is spent advertising things that won’t impact the bottom line, other than negatively because of marketing costs.”

Loss reduction

The company was able to trim its streaming business’s losses by $400 million, a 26% year-over-year decline, beating Wall Street estimates for Disney’s quarterly earnings and revenue, thanks to a impressive January-March performance at the company’s theme parks.

This victory comes amid a second fiscal quarter ending April 1 plagued by companywide layoffs (7,000 employees), a writers’ strike, and a battle with Florida Gov. Rick DeSantis .

Disney is currently laying off 7,000 employees and is on track to meet or exceed projected savings of $5.5 billion .


For Disney’s linear television networks , revenue fell 7% to $6.6 billion and operating profit fell 35% to $1.8 billion.

Revenue of Disney ‘s national television channels , which include ABC and ESPN , decreased 4% to $5.6 billion and operating profit fell 33% to $1.6 billion. The drop in operating profit is attributable to lower advertising revenues and higher sports programming and production costs.

International channel revenues for the quarter fell 18% to $1.1 billion and operating profit fell 65% to $85 million.

The Parks, Experiences and Products group , which saw revenue increase 17% to $7.8 billion and operating income increase 23% to $2.2 billion, thanks to increased guest spending at parks and in international and domestic experiences (especially at Disney International Parks and Resorts ).

Content/licensing sales and other revenues, which include box office receipts, increased 18% to $2.2 billion and had an operating loss of $50 million, down from an increase of 16 million dollars from the previous year.

According to Disney :

“Improved theatrical release due to continued success of Avatar: Running Water, released in the first quarter of the current year, partially offset by comparison with year-ago quarter co-production revenue of Spider-Man : Marvel’s No Way Home. The current quarter included the release of Ant-Man and the Wasp: Quantumania, while the previous quarter included the release of Death on the Nile.