The Walt Disney Company (NYSE:DIS) reported growth of its streaming subscriber base in the fourth quarter, along with substantial operating income for the segment.
Here's why the quarterly figures were important for investors, who will get fewer data points moving forward.
Disney's Streaming Segment Shows Strength
The media giant reported 131.6 million Disney+ Core paid subscribers at the end of the fourth quarter, up 12.4 million from the previous quarter. The company highlighted the streaming success during its earnings call.
"Our streaming business had another quarter of profit growth, with operating income up 39% in Q4 for the full year, we hit $1.3 billion in operating income, up $1.2 billion from last year and $300 million ahead of our original guidance," Disney CEO Bob Iger said.
Iger stressed the importance of the operating income growth, reminding investors that the company's DTC business had a $4 billion loss three years ago.
Revenue for the DTC segment was $6.25 billion in the quarter, flat year over year.
Metrics like revenue and operating income will become increasingly crucial for Disney and its investors moving forward. The company is taking a page out of the Netflix Inc‘s (NASDAQ:NFLX) playbook and will no longer report subscriber figures.
Netflix reported its first quarter results in April and highlighted that subscriber figures were higher. Advertising revenue also increased, contributing to overall revenue growth. The company broke out revenue by regional segment and provided quarterly revenue guidance.
Read Also: Disney Isn’t Thinking In Basis Points Anymore — It Wants Margins In ‘Chunks’
What's Next
It will be interesting to see what kind of commentary Disney provides on its DTC streaming segment without giving specific subscriber figures.
Investors and analysts may have to read between the lines on commentary and determine what it means for subscribers.
One area that likely won't be as straightforward anymore is how many subscribers Disney lost due to the suspension of Jimmy Kimmel. The event triggered searches for "cancel Disney plus" and "cancel Hulu" to hit new highs with many believing subscriber losses would increase.
A report said Disney lost 1.7 million Disney+ subscribers between Sept. 17 and Sept. 23, which is 436% above their baseline churn.
Since the fourth quarter ended in September, anyone who cancelled their subscription but had already paid through the end of September was likely counted as a subscriber. They only became an ex-subscriber when their monthly renewal came up in October.
This means the impact of the Kimmel suspension could be fully reflected in Disney's first quarter. With the company not reporting subscriber numbers, the impact could be less obvious.
Disney also raised prices for Disney+ in October. The company is increasing the ad-supported plan to $11.99 and the ad-free plan to $17.99.
With subscribers paying more in the first quarter, streaming revenue is likely to rise. This could lighten the subscriber impact than in a typical quarter.
The DTC segment having higher revenue in the first quarter compared to the fourth quarter could be due to a number of factors and left for investors and analysts to interpret what the numbers and comments mean.
Disney Shares Fall
Disney stock is down 7.9% to $107.43 on Thursday versus a 52-week trading range of $80.10 to $124.69. Disney shares are now down 3% year-to-date in 2025.
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