Disney Hikes Streaming Prices

The entertainment giant reported greater subscriptions on its streaming platform

In its latest results, Disney said it added 14.4 million subscribers to Disney+ in the fiscal third quarter, bringing total subscribers to 152.1 million—higher than the 147 million analysts had expected. However, at the same time, its direct-to-consumer division, which includes the streaming units, lost more money than in previous years. According to Disney, rising production costs for Disney+ and higher sports programming costs for ESPN+ contributed to the losses.

In addition to reporting earnings results and more streaming customers than expected, Disney announced that it is raising the price of its ad-free streaming service by 38%. Disney+ will cost $10.99 per month, up from its current price of $7.99 per month. The increase starts on December 8 in the U.S. 

Disney will soon include a $7.99 per month ad-supported tier, as Disney tries to restructure its pricing options.  

Disney is also raising the price of Hulu subscriptions. The ad-free tier will jump from $12.99 per month to $14.99, while the ad-supported version will cost $7.99 per month, up from $6.99 per month. The new pricing will go into effect in October. A price hike for ESPN+ streaming was announced in July, raising the monthly price from $6.99 per month to $9.99.

Shares of Disney (DIS) are down 28% year-to-date.

"Disney finds itself in the rare position of being able to grow subscribers to Disney+ and raise prices without worrying too much about customer churn. Netflix, on the other hand, is losing subscribers after a series of price hikes. That said, Disney still needs its theme-park business to show stronger growth if it wants to convince investors that its best days are ahead," said Caleb Silver, Editor-in-Chief of Investopedia.

Disney & Streaming Stocks YTD
Take the Next Step to Invest
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.