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Disney+ Hotstar subscribers will decline in Q1 due to the absence of the IPL: Walt Disney

The quarterly report of Q4 of FY22 of The Walt Disney Company showcases a 57 million rise in subscriptions for a total of more than 235 million, out of which Disney+ Hotstar accounted for 61.3 million subscribers

The Walt Disney Company has added 57 million subscriptions in Direct-to-consumer services in the current fiscal year ended October 1, 2022.

The paid subscribers of Disney + Hotstar have also increased from 43.3 million in last year’s October to reach 61.3 million subscribers in Q4 of FY22, which is a 42% increase.

According to Christine McCarthy, Senior Executive Vice President and Chief Financial Officer, “At Disney+ Hotstar, we are currently expecting that subscribers will decline in Q1 due to the absence of the IPL, but we do expect to see some stabilisation in Q2.“

It is to be noted that Disney+, ESPN+, Hulu and Hotstar cumulatively constitute the direct-to-consumer content wing of the streaming player.

Hulu and ESPN+ added approximately 1 million and 1.5 million subscribers, respectively, during the quarter, while Disney+ added over 12 million global subscribers, of which a little less than 3 million were at Disney+ Hotstar.

The average monthly revenue per paid subscriber for Disney+ Hotstar decreased from $0.64 to $0.58 due to lower per-subscriber advertising revenue and a higher mix of wholesale subscribers, partially offset by an increase in retail pricing, the company stated.

According to Bob Chapek, Chief Executive Officer, The Walt Disney Company, “2022 was a strong year for Disney, with some of our best storytelling yet, record results at our Parks, Experiences and Products segment, and outstanding subscriber growth at our direct-to-consumer services, which added nearly 57 million subscriptions this year for a total of more than 235 million.”

The revenues of the company have also increased to $20,150 million in the Q4 of FY22, which is a 9% up from the corresponding quarter of last year which stood at $18,534 million.

Out of the $20,150 million revenue Walt Disney had generated in Q4 of FY22, Disney Media and Entertainment Distribution accounts for $12,725 million. In the final quarter of the previous year, the segment revenue from the same was $13,084 million, thereby denoting a dip of 3% on a year-on-year basis.

The operating income from Disney Media and Entertainment Distribution has fallen massively from Q4 of FY21, where it stood at $947 million to the final quarter of the current year which stands at a mere $83 million, denoting a 91% tanking on a YoY basis.

“The decrease at Disney Media and Entertainment Distribution was due to lower operating results at Direct-to-Consumer and Content Sales/ Licensing, partially offset by growth at Linear Networks,” as per a statement released by Walt Disney.

The statement also revealed that the decrease at Direct-to-Consumer was due to higher losses at Disney+ and, to a lesser extent, lower results at Hulu and higher losses at ESPN+.

Furthermore, McCarthy also said, “Lower pay-per-view revenue at ESPN+ and slightly lower advertising revenue at Hulu and Disney+ Hotstar also impacted direct-to-consumer revenue in the fourth quarter relative to the third quarter.”

“In the first quarter of fiscal 2023, we expect direct to consumer operating results to improve by at least $200 million versus the fourth quarter of fiscal 2022, with larger improvement expected in Q2,” McCarthy added.

The tanking results of Content Sales/ Licensing were attributed to the decrease in TV/SVOD distribution results, higher film cost impairments and decrease in home entertainment and theatrical distribution results, partially offset by an increase at our stage play business, as productions were generally shut down in the prior year due to COVID-19, the statement mentioned.

Moreover, the revenue earned from Direct-to-consumer stood at $4907 million and revenue from Content Sales/ Licensing stood at $1736 million in Q4 of FY22, juxtaposed to the corresponding quarter of the previous year which summed up to $4560 million and $2047 million, respectively.

In the International Channels category, Walt Disney witnessed an 18% decline from last year’s $1284 million as the revenue for Q4 of FY22 stood at $1056 million. The operating income for the same also dipped to $115 million, from last year’s $140 million on a YoY basis in Q4 of FY22.

As per the statement, this decline was a result of the decrease in advertising revenue and, to a lesser extent, higher marketing spend and an unfavourable foreign exchange impact, partially offset by lower sports programming costs.

“The decrease in advertising revenue was due to lower average viewership, partially offset by higher rates,” the statement mentioned.

The decreases in sports programming costs and average viewership were due to the non-comparability of cricket events reflecting the impact of COVID-19-related timing shifts, as per the company.

The statement also highlighted that the most significant impact was on the timing of Indian Premier League cricket matches, as there were no matches in the current quarter compared to 18 matches in the prior-year quarter.

Info@BestMediaInfo.com

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