The Walt Disney Company on Thursday reported that its Disney+ streaming platform had surpassed the 73 million paid subscriber mark while its park, experiences and products segment revenue sank by 61% due to the coronavirus pandemic.
The company reported 60.5 million paying subscribers for the streaming service as of Aug. 4, when Disney reported its last earnings.
“Even with the disruption caused by COVID-19, we’ve been able to effectively manage our businesses while also taking bold, deliberate steps to position our company for greater long-term growth,” Disney CEO Bob Chapek said in a statement. “The real bright spot has been our direct-to-consumer business, which is key to the future of our company, and on this anniversary of the launch of Disney+ we’re pleased to report that, as of the end of the fourth quarter, the service had more than 73 million paid subscribers – far surpassing our expectations in just its first year.”
The company reported a revenue of $14.7 billion, down from $19 billion last year, with a loss per share of 39 cents. Analysts following the stock via Yahoo! Finance expected Disney revenue to come in at $14.2 billion, with a loss of 70 cents per share. The company’s net loss was $710 million.
Disney was most impacted in its parks, experiences and products division due to theme park closures or limited capacity orders. Revenue for the quarter decreased by 61% to $2.6 billion. Disneyland Resort and the company’s cruise line business closed for all of the current quarter, and the company estimate that the total net adverse impact of COVID-19 on the division’s operating income was $2.4 billion.
Earlier this month, Disney announced 28,000 layoffs at its U.S. parks. The company blamed California for exacerbating its financial woes due to its “unwillingness” to lift COVID-19 restrictions that would allow Disneyland, which has remained closed since March, to reopen. Walt Disney World in Florida has been opened with limited capacity since July.
Revenue for the studio entertainment division decreased 52% to $1.6 billion for the fourth quarter, with segment operating income decreasing 61% to $419 million. This decrease was due to theater closures brought on by the pandemic, as well as lower home entertainment results. There was virtually no significant worldwide theatrical releases this quarter, compared to last year’s “The Lion King” and “Toy Story 4.”
The company said the decrease in home entertainment was due to lower unit sales, offset by lower marketing costs. The prior-year quarter saw strong performances of “Avengers: Endgame,” “Aladdin” and “Captain Marvel,” while this quarter saw no comparable titles.
Direct-to-Consumer & International revenues for the quarter, however, increased by 41%to $4.9 billion, with the company reported a segment operating loss decreased from $751 million to $580 million. The decrease is due to strong performance at Hulu and ESPN+, including subscriber growth and increases in programming.
Cable Networks revenues grew by 11% to $4.7 million in revenue, with operating income decreasing 7% to $1.2 billion. Media networks revenues also grew 11% to $7.2 billion, with segment operating income increasing by 5% to $1.9 billion.