ESPN+ Rises But Disney Misses Revenue Expectations

Disney continues to build toward profitability in streaming, with ESPN+ acting as a stabilizing force.

The media giant brought in $20.15 billion in revenue for the fiscal fourth quarter ending Oct. 1, a 9% increase from the same period last year.

• ESPN+ led among the companies streaming services with 42% year-over-year subscriber growth, reaching 24.3 million as of Oct. 1.
• ESPN+’s subscriber growth helped offset lower income from a drop in pay-per-view buys on UFC events.
• Disney+ grew 39% to hit 164.2 million.

Fiscal year revenue showed substantial recovery from the pandemic: Disney banked $82.72 billion, a 23% increase from the previous year.

While streaming growth was better than expected, the company missed revenue expectations in both its parks and media segments. Disney’s stock was down around 6.4% in early after-market trading.

Gaining Stream

Total streaming revenue rose 8% to $4.9 billion, but the segment’s operating loss nearly doubled to $1.5 billion. 

“The increase in operating loss was due to a higher loss at Disney+ and a decrease in results at Hulu, partially offset by improved results at ESPN+,” the company wrote.

CEO Bob Chapek said he expects “DTC operating losses to narrow going forward and that Disney+ will still achieve profitability in fiscal 2024.”

The company has been enjoying its return to NHL broadcasting, banking $90 million in ad sales for the 2022-23 season, sources told Front Office Sports.

Disney could rake in more than $700 million in college football ads on ESPN and ABC.