Disney+ Tops 164 Million Subscribers, Ad-Supported Tier Coming in December

The Walt Disney Company on Tuesday announced Disney+ subscriber numbers and overall earnings for its fourth quarter and fiscal 2022 ended October 1.

Disney+ ended the quarter and fiscal year with a total of 164.2 million subscribers across the globe, up 39% year-over-year, after adding 12.1 million new subscribers during Q4.

“2022 was a strong year for Disney, with some of our best storytelling yet, record results at our Parks, Experiences and Products segment, and outstanding subscriber growth at our direct-to-consumer services, which added nearly 57 million subscriptions this year for a total of more than 235 million,” said Bob Chapek, CEO of The Walt Disney Company, in a statement.

The streaming service handily beat Wall Street estimates for subscriber additions in the quarter. Analysts had pegged Disney+ for 160.45 million total subscribers.

“Our fourth quarter saw strong subscription growth with the addition of 14.6 million total subscriptions, including 12.1 million Disney+ subscribers,” added Chapek.

Quarterly revenue for Disney’s Direct-to-Consumer segment, which includes Disney+, rose 8% to $4.9 billion. However, operating loss for the segment went from $0.8 billion in the year-ago quarter to $1.5 billion, due in large part to a higher loss at Disney+. Chapek said the streamer doesn’t expect to turn a profit until fiscal 2024, and that’s assuming a stable economic climate.

“The rapid growth of Disney+ in just three years since launch is a direct result of our strategic decision to invest heavily in creating incredible content and rolling out the service internationally, and we expect our DTC operating losses to narrow going forward and that Disney+ will still achieve profitability in fiscal 2024, assuming we do not see a meaningful shift in the economic climate.”

In Canada and the U.S., Disney+ now has 46.4 million paid subscribers, an increase of 20% from the year-ago quarter.

Despite gaining subscribers in these countries, Disney+ saw its average monthly revenue per paid subscriber in the region drop 10% year-over-year to $6.10 USD. At the end of Disney’s third quarter, that figure stood at $6.27.

Earlier this year, The Walt Disney Company announced a cheaper, ad-supported subscription tier for Disney+ that will serve about four minutes of ads per hour of content. The new Disney+ plan is slated to launch on December 8 and will debut for $7.99 USD per month in the U.S.

“By realigning our costs and realizing the benefits of price increases and our Disney+ ad-supported tier coming December 8, we believe we will be on the path to achieve a profitable streaming business that will drive continued growth and generate shareholder value long into the future,” said Chapek

“As we embark on Disney’s second century in 2023, I am filled with optimism that this iconic company’s best days still lie ahead.”

Streaming rival Netflix launched its own ad-supported subscription plan earlier this month. Currently, Disney+ costs $11.99 CAD per month and $119.99 CAD per year in Canada.