MUMBAI: The Walt Disney Company (Disney) reported its first fiscal quarter earnings, the first result since the launch of its new streaming service Disney+. Beating Wall Street expectations, the company has seen a strong start by reporting $20.86 bn revenue in contrast to market expectation of $20.79 bn. Disney’s adjusted earnings per share came in at $1.53 versus the expected $1.44.

“We had a strong first quarter, highlighted by the launch of Disney+, which has exceeded even our greatest expectations,” said Disney chairman and chief executive officer Robert Iger said.

“Thanks to our incredible collection of brands, outstanding content from our creative engines and state-of-the-art technology, we believe our direct-to-consumer services, including Disney+, ESPN+ and Hulu, position us well for continued growth in today’s dynamic media environment,” he added.

Media Networks revenues for the quarter increased 24 per cent to $7.4 bn, and segment operating income increased 23 per cent to $1.6 bn. Cable Networks revenues for the quarter increased 20 per cent to $4.8 bn and operating income increased 16 per cent to $862 mn. Broadcasting revenues for the quarter increased 34 per cent to $2.6 bn and operating income increased 41 per cent to $575 mn.

Studio Entertainment revenues for the quarter increased from $1.8 bn to $3.8 bn and segment operating income increased from $309 mn to $948 mn. Higher operating income was due to increases in theatrical and TV/SVOD distribution results at legacy operations, partially offset by a loss from the consolidation of the TFCF businesses.

Direct-to-Consumer and International revenues for the quarter increased from $0.9 bn to $4.0 bn and segment operating loss increased from $136 mn to $693 mn. The company stated that increase in operating loss was due to costs associated with the launch of Disney+, the consolidation of Hulu and a higher loss at ESPN+. However, it also mentioned that these increases were partially offset by a benefit from the inclusion of the TFCF businesses due to income at the international channels including Star.

The company’s biggest bet at streaming Disney+ delivered an impressive 26.5 mn subscribers, starting from Nov. 12 through year’s end. ESPN+ had 6.6 mn subscriber as of 28 December. Hulu’s SVOD only subscriber stood at 27.2 mn while the service combined with Live TV offering had 3.2 mn subscribers.

“The average monthly revenue per paid subscriber for ESPN+ decreased from $4.67 to $4.44 due to a shift in the mix of subscribers to our bundled offering. In November 2019, the Company began offering a bundled subscription package of Disney+, ESPN+ and Hulu. The bundled offering has a lower average retail price per service compared to the average retail price of each service on a standalone basis,” Disney stated.

“The average monthly revenue per paid subscriber for our Hulu SVOD Only service decreased from $14.49 to $13.15 driven by lower retail pricing and a shift in the mix of subscribers to our bundled offering. The average monthly revenue per paid subscriber for our Hulu Live TV + SVOD service increased from $52.31 to $59.47 due to higher retail pricing,” it added.