Walt Disney surpassed Netflix with a total of 221 million streaming customers and announced it will raise pricing for consumers who wish to watch commercial-free content on Disney+ or Hulu.
In December, when it begins offering a new option at the existing price that includes advertisements, the media giant will increase the monthly price of Disney+ without ads by 38 percent to $10.99.
In 2017, Disney bet its future on developing a streaming service to compete with Netflix, as viewers shifted from traditional cable and broadcast television to internet viewing.
Since then, Disney now has more streaming clients than Netflix. As a result of the introduction of the "Star Wars" series "Obi-Wan Kenobi" and "Ms. Marvel," the "Mouse House" added 14.4 million customers to Disney+, surpassing the 10 million analysts polled by FactSet had predicted.
Disney reported 221.1 million streaming customers at the end of the June quarter, including Hulu and ESPN+. Netflix has 220.7 million members to its streaming service.
"Disney is increasing market share while Netflix struggles to recruit members," said Haris Anwar, an analyst at Investing.com.
To attract new consumers, Disney will begin offering an ad-supported version on December 8 for $7.99 per month, the same price it currently charges for an ad-free edition.
In December, prices for Hulu will increase by $1 to $2 per month, depending on the plan.
On Wednesday, the firm reduced its long-term subscription expectation for Disney+, citing the loss of cricket rights in India.
Disney currently anticipates between 215 million and 245 million total Disney+ subscribers by September 30, 2024. This is less than the 230 million to 260 million that Disney had predicted.
Disney has thus surpassed expectations for Disney+ Hotstar subscribers in India from other Disney+ subscribers for the first time.
Christine McCarthy, Disney's chief financial officer, stated that the company anticipated adding up to 80 million Disney+ Hotstar members by September 2024, in addition to 135 million to 165 million more customers.
McCarthy stated that the business still expects its streaming TV unit to generate a profit in fiscal year 2024. The division's most recent quarterly loss was $1.1 billion.
During the fiscal third quarter that concluded on July 2, Disney reported adjusted earnings per share of $1.09, an increase of 36% compared to the same period a year earlier. Analysts surveyed by Refinitiv anticipated earnings of 96 cents per share.
Overall income grew by more than a quarter from the previous year to $21.5 billion, above analysts' expectations of $20.96 billion.