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What just happened? Disney has just revealed how many people are signed up to the ad-supported tier for Disney+, though the announcement was unintentional. It was company CEO Bob Iger himself who made the gaffe, though he did add – a little too late – that “I don’t know if I was supposed to disclose those numbers.”
During Disney’s earnings report for the fourth financial quarter of 2024 yesterday, a Wall Street Journal analyst asked Iger about Disney+’s growth outlook and pricing strategy.
Iger revealed that 37% of US-based Disney+ users were signed up to its cheapest, ad-supported tier. Slightly more than the global figure of 30%.
While the CEO didn’t reveal exact numbers, there are 56 million Disney+ subscribers in the US. If 37% are on the ad-tier, it means that around 20.7 million have their shows and movies interrupted by ads. With 122.7 million global subscribers and 30% on the ad tier, it means 36.8 million Disney+ customers are saving money at the cost of ad intrusions.
Graphs by App Economy Insights
Compared to the $10 per month Disney charges, Netflix’s $7 ad-supported tier is $3 cheaper. Deadline reports that Netflix has 70 million people on this plan globally. That’s more than Disney+, but with worldwide subscriber numbers of 282.7 million, it means roughly 25% of Netflix users opt for ad-supported.
Back in December 2023, 5% of Netflix’s US subscribers were being shown commercials, compared with 17% for Disney+. It appears a lot more people have chosen to save money and go ad-supported over the last year.
Iger is unlikely to be too upset about his accidental reveal, given how well Disney performed over the quarter. Deadpool & Wolverine and Inside Out 2, the two top movies of 2024 so far, both of which grossed over $1 billion, helped push revenue up 6% year-on-year to about $22.57 billion, beating Wall Street analysts’ expectations.
Disney’s subscription services were also a bright spot: it now boasts 174 million Disney+ core and Hulu subscriptions. Disney+ global subscriptions alone are up 4.4 million compared to the previous quarter, while Hulu gained 900,000 more subs. Streaming revenue rose 15% to $5.78 billion, and ad sales rose 14%. Disney said its gains came from subscription price hikes and lower marketing costs.
