Disney says its flagship streaming service lost 4m
subscribers in the first three months of the year amid a wider cost-cutting
drive.
At the same time the Disney+ platform narrowed its losses by
$400m (£316.5m).
The home of Mickey Mouse, the Star Wars franchise and Marvel
movies is under pressure to make its streaming business profitable as the
traditional film and television market shrinks.
Shares in the company fell by around 5% in after-hours
trading in New York.
Most of the subscriber losses came from its Hotstar service
in Asia, which lost streaming rights to Indian cricket matches last year.
Disney+ also lost around 300,000 customers in the US and Canada after raising
subscription prices.
It comes as Disney’s streaming business reduced its
operating losses to $659m for the first three months of this year. That was
down from $1.1bn in the previous quarter.
Disney chief executive Bob Iger said the improved financial
performance reflects “the strategic changes we’ve been making throughout the
company to realign Disney for sustained growth and success.”
He previously said Disney+ had reached a “turning point” and
would become profitable by next year.
Earlier this year, the entertainment giant reported its first
fall in subscriber numbers and announced plans to cut 7,000 jobs.
The latest announcement comes after thousands of Hollywood
TV and movie screenwriters held their first strike in 15 years last week.
They are calling for better pay and working conditions as
the transition to streaming has upended the traditional television and film
industry.
The last writers’ strike was in 2007. It lasted 100 days and
cost the industry an estimated $2bn.
On Wednesday, Disney’s chief financial officer Christine
McCarthy declined to put a figure on how much the latest strike could cost the
company.
The walkout has already shut down several Disney projects,
including those set to run on Disney+.
Disney has poured billions of dollars into its streaming
platforms in recent years, transforming it from a company rooted in traditional
television, movies and theme parks into one of the streaming industry’s major
players.
It now has a total of more than 231 million subscriptions
across its three streaming platforms, which also include the sports-focused
ESPN+ and wider entertainment site Hulu.
Disney+ has close to 158m subscribers around the world,
although that is still behind rival Netflix’s 232.5m subscribers.
Source - BBC
- Agencies
