Disney will put a stamp on how the media industry views streaming’s growth potential — at least for the time being — when it announces its quarterly earnings results on Wednesday, according to CNBC.
The possible conclusions are “don’t panic” or “call the doctor.”
Wall Street analysts on average expect that Disney added about 10 million Disney+ subscribers during the period, pushing its total global customers for the service to about 147 million, according to FactSet.
If Disney hits or exceeds that forecast, investors and media executives can file the quarter away as one that showed mixed trends for the industry. It will suggest the global streaming market isn’t nearing saturation. With the right product, in certain regions of the world, Disney can show entertainment companies are still capable of adding many millions of subscribers in a quarter.
With double-digit million net adds for Disney+, Disney would join Paramount Global as relative winners for the past three months. Paramount+ added 3.7 million subscribers, including 1.2 million disconnects in Russia, in the quarter.
Adding 10 million subscribers in the quarter and forecasting another 10 million adds in the next will help convince investors that Netflix’s sudden stalled growth is not reflective of the entire entertainment industry. Netflix reported a loss of 1 million subscribers in the quarter and forecast a gain of just 1 million subscribers for its third quarter. Netflix has 221 million subscribers worldwide.
There’s some evidence Netflix investors believe the company has hit a temporary bottom rather than an extended slowdown. Netflix shares have risen 19% since the company announced its quarterly earnings on July 19. The gain suggests there’s belief that Netflix will be able to reinvigorate subscriber and revenue growth in coming quarters, spurred by a cheaper Netflix advertising-supported tier, a password sharing crackdown and the company’s push into video games.
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