Walt Disney's stock has surged in the past week as the company's latest earnings report showed that it is making progress in the streaming business and announced another price increase for its streaming services.
In the company's third-quarter earnings report, revenue increased 4% to $22.3 billion, slightly below consensus of $22.5 billion.
Segment operating profit remained at $3.56 billion. Its media and entertainment division saw revenue decline 1% to $14 billion and operating income decline 18% to $1.13 billion. Performance in its Parks, Experiences and Products division was better, with revenue up 13% to $8.32 billion and operating income up 11% to $2.4 billion.
The number of subscribers declined
The company added 800,000 core Disney+ subscribers to reach 105.7 million, which does not include Disney+ Hotstar subscriptions, which showed modest growth.
The number of total Disney+ subscribers continued to decline, falling 5 million year-over-year to 146.1 million, marking the third consecutive quarter of declining subscriber numbers.
Comment by the Director-General
Bob Iger said, "Our results this quarter reflect what we have achieved through the unprecedented transformation we are undertaking at Disney to restructure the company, drive efficiencies and put creativity back at the center of our business."
Prices will be higher again
In conjunction with the earnings, management announced that it plans to raise the prices of its streaming services again, raising the price of Disney's ad-free version from $11 to $14, while Hulu's ad-free version will increase 20% to $18.
Investors seem encouraged by the move and the smaller-than-expected losses in the streaming segment, which is the future of its entertainment business.
Disney tries to follow Netflix's example
The media and entertainment giant's third-quarter financial results for the period ending July 1 weren't all that impressive, but investors took some comfort in the company's plans to make its Disney+ streaming service look "healthier" again.
Will Walt Disney's stock finally bounce higher?
