Disney posts mixed results, to follow Netflix's lead in password sharing crackdown

Disney’s online video operation cut its loss to $512 million from more than $1 billion a year ago. Just three months ago, management predicted the direct-to-consumer business would lose more than $750 million in the quarter. Chief Executive Officer Bob Iger also told investors that the company will crack down on password sharing, echoing the recent effort from rival Netflix Inc. that has boosted subscriber numbers.

But subscribers to the Disney+ streaming service tumbled 7.4 percent to 146.1 million from the previous three months, missing the 154.8 million consensus analysts had expected. Nearly all of that shortfall was borne by the company’s Disney+ Hotstar in Asia. It lost almost 25 percent of its customers after Disney failed to renew streaming rights for popular cricket games in the Indian Premier League.

Additionally, the company will raise the price of its streaming service, including a 27 percent hike for the ad-free version of Disney+.

It’s the second price increase for Disney+ in less than a year — and underscores the company’s drive to make its streaming business profitable by September 2024. The lowest-priced plans, Disney+ and Hulu with ads, will remain at $8 a month.

As part of the changes, Disney introduced an ad-free version of Disney-Hulu bundle priced at $20 a month. An ad-free version of a bundle with Disney+, Hulu and ESPN+is increasing to $25 monthly from $20, while a subscription to that package with ads will rise to $15 monthly from $13.

Rival Netflix Inc. charges $15.50 a month for its ad-free service, while Warner Bros. Discovery Inc. prices the Max service at $16.