Disney+ reaches 54.5 mn subscribers; board to forgo dividend

Disney+ has reached 54.5 million subscribers worldwide, the Walt Disney Company has announced on Tuesday. Although the service has recorded 4.5 million new subscribers since it had reached the 50 million landmark on April 8, the growth rate has slowed down during the month.

The company had earlier forecast up to 90 million Disney+ subscribers by the end of its 2024 fiscal year.

Disney has also reported that Hulu has 32.1 million total subscribers, while ESPN+ had 7.9 million subscribers

Streaming platforms are seeing a surge in viewership during the Covid-19 pandemic. Netflix last month reported 15.77 million global paid net subscriber additions but warned of an expected decline in viewership and slowdown once shelter-in-place orders begin to lift.

Disney shares dropped almost 3% after hours as investors digested the news and executives’ comments during the earnings call.

“While the COVID-19 pandemic has had an appreciable financial impact on a number of our businesses, we are confident in our ability to withstand this disruption and emerge from it in a strong position,” said Bob Chapek, Chief Executive Officer, The Walt Disney Company. “Disney has repeatedly shown that it is exceptionally resilient, bolstered by the quality of our storytelling and the strong affinity consumers have for our brands, which is evident in the extraordinary response to Disney+ since its launch last November.

“The response to Disney Plus even exceeded the highest expectations. Since our initial launch in November, we continue to expand in other markets. In late March, despite COVID-19, we had a successful launch of Disney Plus in Western Europe followed by a highly successful launch in India. In just five months we have surpassed 50 million subscribers globally. It’s a significant milestone for us. We are pleased to see the growth in four weeks since then.”

Meanwhile, The Walt Disney Company Board of Directors has announced that it will forgo payment of a semi-annual cash dividend for the first half of fiscal 2020, given the significant operational and financial disruption caused by COVID-19.

The Board’s action is one of several measures the Company has taken in the wake of the pandemic, including reducing capital spending, cutting salaries for senior management, and making the difficult decision to furlough employees. By not issuing a semi-annual dividend, the Company will preserve about $1.6 billion in cash, based on the 88 cents a share previously paid to shareholders in January, the company has announced.

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