Disney+ subs climb to 54.5M; Hulu has 32.1M total subsDisney+ subs climb to 54.5M; Hulu has 32.1M total subs

Disney's overall business is being hit hard by the pandemic, but its streaming and direct-to-consumer business saw large gains during the company's fiscal second quarter.

Disney+, the SVoD service that debuted last November, had about 33.5 million subscribers as of March 28 (the date Disney's fiscal Q2 ended), but has climbed to 54.5 million as of May 4.

Hulu ended the quarter with 32.1 million total subs, up 27% year-on-year. That total includes 3.3 million for Hulu's Live TV-plus-SVoD combo, up 65% year-over-year, and 28.8 million SVoD-only subs, up 24%.

Revenues at Disney's direct-to-consumer and international segment in Q2 totaled $4.1 billion, up from $1.1 billion. However, losses in the unit surged to $812 million, from $385 million, due to the costs associated with the launch of Disney+ and Disney's consolidation of Hulu.

Though Disney+'s subscriber ramp has exceeded expectations and has already put the service in position to easily beat original forecasts of between 60 million to 90 million subs by fiscal 2024, the company is not updating subscriber guidance or projections on when the service will reach profitability.

Disney is bullish on Hulu's international potential, but the uncertainty on the company's overall business during the pandemic has caused the company to pause global investment on that service in the short term, CEO Bob Chapek said on today's call.

Disney also left the door open a crack on releasing some of its new theatricals in a new "premium" SVoD window that has put fellow media giant NBCUniversal in hot water with some theater owners.

"We very much believe in the value of the theatrical experience overall," Chapek said. But he allowed that the changing consumer dynamics created by the pandemic means Disney might have to alter its overall strategy. "We'll evaluate every movie on a case-by-case situation," he added.

Disney was also pressed on how long it can continue to make payments to leagues while there are no live sports. Several US pay-TV providers are under pressure from the New York Attorney General to reduce fees while live sports remain in limbo.

Disney is "in active discussions with them [the sports leagues] now, and I'll leave it at that," company CFO and senior EVP Christine McCarthy said.

Due to theme park closures, cruise line shutdowns and other negative impacts from the pandemic, Disney's overall business saw earnings plummet 93%, or by 26 cents per share, during the quarter. Total revenues climbed 21%, to $18 billion, but revenues at Disney's studio unit dropped 18%, to $2.5 billion.

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— Jeff Baumgartner, Senior Editor, Light Reading