Disney Plus makes a profit after 6 years

Disney Plus subscription service has made profits in two consecutive quarters. Disney CEO Bob Iger has further indicated which subscription plans are making money for the company.

Disney Plus has started making profits for the company

Netflix had once reigned over the subscription streaming service business. However, the competition has heated up in the last few years. Competition forced businesses to keep their prices low and attract subscribers.

For several years, Netflix was the only streaming service that was earning well in the business. However, its rivals are gradually making money in the streaming business and earning profits in multiple quarters.

During an earnings call, Disney CEO Bob Iger confirmed that Disney Plus made a profit in the second consecutive quarter. Specifically speaking, profit from Disney Plus, Hulu, and ESPN Plus amounted to $321 million in Q4 2024 (ending September 2024). This is astonishing because, in the previous quarter, these services earned Disney $47 million.

Which subscription plans helped Disney and why?

In addition to Disney, subscription services such as Paramount+ also managed to make profits in two consecutive quarters. It appears there are a few reasons behind streaming services making money and staying profitable.

According to Disney’s CEO, subscribers are largely comfortable with advertisements. Specifically speaking, around 60% of all new subscribers are choosing Disney Plus’s ad-supported plan, Bob mentioned.

Around 37% of Disney Plus subscribers in the US are subscribed to ad-supported plans. In other words, the ad-supported subscriptions are an attractive, low-cost option that allows subscribers to consume content, indicated Bob,

“It’s not just about raising pricing. It’s about moving consumers to the advertiser-supported side of the streaming platform… the pricing that we recently put into place, which is increased pricing, was designed to move more people in the AVOD [Advertising-based Video on Demand] direction.”

Disney Plus has been growing steadily in the last couple of years. Interestingly, the company plans to roll out password sharing more broadly, a privilege that Netflix has been aggressively stomping out.