Disney announced that Hulu will be integrated into Disney+ by the end of the year, with Hulu replacing Star in the international version of Disney+. Subscribers will no longer receive updates on subscriber counts or revenue for the streaming services, impacting investor metrics. Disney’s recent earnings report showed a revenue increase but a decline in linear network revenue.
The Walt Disney Company reported a profit of $1.61 per share in their fiscal third quarter of 2025, surpassing expectations. However, revenue fell slightly short of estimates, leading to a decline in Disney’s stock. The company’s cable television arm faced a 15% revenue drop, affecting overall operating income. Despite this, the streaming division saw growth in revenue and subscribers.
Disney’s streaming division reported a revenue increase and added 1.4 million Disney+ subscribers last quarter. Hulu also gained 1.3 million streaming subscribers, but lost subscribers to its live-TV service. CEO Bob Iger announced that Disney will no longer report subscriber numbers for Disney+ and Hulu starting in fiscal 2026, focusing instead on overall profitability.
The decision to stop disclosing subscriber counts aligns with industry trends, similar to Netflix’s strategy. Some investors speculate that the timing coincides with slower subscriber growth, impacting transparency. The market was prepared for the integration of Hulu into Disney+, as the possibility was previously discussed. The move simplifies access to Disney’s streaming content for subscribers.
The integration of Hulu into Disney+ will provide a seamless experience for subscribers, with a minimal increase in cost. Disney’s focus on monetizing content through advertising will benefit from the consolidation. The decision to combine the services may impact investor metrics but aligns with industry trends towards revenue and profitability reporting. Disney has decided to add Hulu to Disney+, simplifying content management and potentially boosting revenue. While some investors were concerned about omitted customer metrics, analysts remain optimistic about the partnership’s potential. The combined streaming services are as popular as Netflix and Amazon Prime in the U.S., making the decision a strategic move. Disney’s direct-to-consumer business remains a small portion of its revenue, providing a cushion if the streaming venture doesn’t perform as expected. Despite the setback, analysts rate Disney stock as a strong buy, with a consensus price target of $135.12, 17% above the current price. If you’re considering investing in Disney, be aware that the Motley Fool Stock Advisor team did not include it in their list of 10 best stocks to buy now. Their top picks have historically outperformed the market significantly, making it worth considering their recommendations before making an investment decision.
Read more at Yahoo Finance: CEO Bob Iger Announces Joint Hulu and Disney+ Streaming Service. What Does It Mean for Investors?