The great streaming slowdown of 2022 hasn’t hit Mickey Mouse yet.
Walt Disney Co. on Wednesday reported better-than-expected subscriber growth from its marquee streaming service Disney+ as it charged forward with its direct-to-consumer transformation while increasing revenue from its crucial theme parks business.
The Burbank entertainment giant said Disney+ added nearly 8 million subscribers during the second quarter, exceeding analyst estimates. Wall Street had expected Disney+ to gain about 5.2 million paying members, according to FactSet. The service now has 137.7 million subscribers.
Disney’s latest report was sure to attract attention amid growing worries among investors and Hollywood executives that the streaming business may not be as big or lucrative as once thought.
Disney Chief Executive Bob Chapek has made it his mission to grow Disney+, along with the company’s other streamers Hulu and ESPN+, to astronomical heights in order to keep the company relevant to modern viewers who are abandoning the cable bundle.
Entertainment companies, including Disney, have spent billions of dollars to launch and expand streaming services that would compete with Netflix as the Los Gatos, Calif., giant upended the business. Early in the pandemic, subscriber counts soared and share prices followed as housebound consumers signed up for at-home entertainment options.
But then Netflix last month reported that it had lost subscribers for the first time in more than a decade. The company’s membership count declined by 200,000, prompting executives to blame competition, rampant password sharing and the company’s pause in Russia. Netflix promised to rein in spending. Jobs were cut in marketing. Netflix’s shares are down more than 70% so far this year.
Disney’s shares have also taken a hit amid broad stock market declines, despite the remarkable resurgence of the company’s parks and theatrical releases such as its latest Marvel hit, “Doctor Strange in the…