Disney Rediscovers its Magic as Streaming Subscribers Soar

Disney has reported strong subscriber growth and a positive outlook for its Disney+ streaming platform, putting its competition on red alert.

Feb. 10, 2022

Streaming platforms have had a torrid time of late. Netflix stock sank 20% last month following a poor Q1 outlook, while Spotify dropped by as much as 18% after similarly bleak projections.

So, why is Disney (NYSE: DIS) bucking the trend?

Disney+ is tearing it up

Disney+ added 11.8 million subscribers in Q1, beating analyst expectations by almost 5 million. With its competitors slowing down, the House of Mouse has poured billions into developing new shows with extremely high production value to snatch customers away from its rivals.

As recently as last month, Netflix openly admitted that “added competition may be affecting our marginal growth.” Disney clearly has designs on the streaming crown and is making a strong push to claim the throne. The firm still lags behind, boasting 129.8 million subscribers to Netflix’s 222 million, but the tide definitely seems to be turning.

Disney has flexed its significant financial muscle to add extensively to its content catalog. Highly anticipated original content from globally adored franchises such as ‘Star Wars’ and ‘Marvel’ have piqued customer interest, and the company’s strategy of debuting feature films on its platform has added even more value to its offering.

Disney is also continuing to innovate within the streaming space, running its first-ever test of live-streaming capabilities this week. This new form of content, if received well, will give Disney a key advantage over its competitors. 

Netflix is still a strong company, but its distinct first-mover advantage is being slowly whittled away. Companies like Disney who have the intellectual property and, more importantly, the finances to develop extraordinary content are eating into its user-base.

The streaming wars are certainly far from over, but Q1 of 2022 could be remembered as a decisive turning point should Disney eventually emerge on top.