Seema Shah · May 2023
Small Screen: Disney+ Subscribers Decline
Disney+ saw a 2% decrease in paid subscribers in Q2 of FY23, but price increases helped reduce losses. Hotstar also saw an 8% decrease in subscribers due to the loss of IPL games. Disney plans to integrate Hulu into Disney+ for a one-app experience launching in 2H23. Warner Brother Discovery's legacy entertainment business declined in Q1, but its US direct-to-consumer arm saw a small profit with reported subs up 2% QoQ. Paramount reported growth in DTC subs and improving churn.
Key Takeaways:
Disney+ total paid subs decreased 2% QoQ in FY23 2Q: though price increases to its streaming plans helped the company reduce losses, Hotstar subs fell 8% QoQ, inline with ST Hotstar MAUs (-7% QoQ), largely due to the loss of IPL games. ST data shows continued weakness for Hotstar into Apr’23 with MAUs down 14% MoM (-21% YoY)
Disney plans to integrate Hulu into Disney+ for a one app, integrated experience that's set to launch in 2H23. This merged service provides Disney+ with a vast library of diversified content along with a built-out ad-supported network in Hulu which boasted 31mn mobile MAUs in 1Q23
Declines in Warner Brother Discovery’s legacy entertainment business in 1Q23 were tempered by a small profit in its US direct-to-consumer (streaming) arm with reported DTC subs up 2% QoQ (8% YoY); ST MAUs for HBO Max and Discovery+ (combined) increased 8% QoQ (11% YoY) on the popularity of the hit video game-to-TV adaptation of The Last of Us
Paramount reported growth in DTC subs (directionally inline with ST MAUs) and improving churn: Per ST data, Paramount+ domestic (US) churn has fallen over the past three years, with average 1Q23 user churn down 2pps vs 1Q22 and 10pps vs 1Q21
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