Disney + has been something of a darling of the post-pandemic streaming age, leaping to the forefront of streaming services despite being a relative neonate next to Netflix and others. Yet, despite this fast climb to the top and a solid, if unexciting Q3 result, we’re finally seeing some push back on claimed growth potential from Wall Street investors. Entertainment lawyer with Blake & Wang P.A, Brandon Blake, guides us through the details.
Ambitious 2024 targets
Financial observers are calling into question the projected subscriber growth target for 2024 of 230 million to 260 million subscribers. The streaming giant currently sits at 116 million paying subscribers globally, an impressive gain in a little more than a year of operation.
Despite this boom, we’ve seen downgrades on the previously bullish sentiment around Disney. Q3 gains suggest ‘low single-digit millions’ for new subscriber growth, where Wall Street sentiments would have needed around 17 million to deliver on previous optimism.
Reasonable growth
Of course, there are good reasons for the slow uptake. Indian subscriber growth slowed after it was announced the cricket season (streamed on Disney in India) would not go ahead. There have also been delays to their Latin American rollout, and other recent production delays.
However, analysts feel this is indicative of a longer-term pattern. In particular, they highlight a need for greater content spending and a need to onboard older households if Disney+ is to thrive. This has seen downgrades in predicted share price ranging from $13 (to $203 from Barclays) to $35 (to $175 from Barclays).
To meet their ambitious milestone, Disney + would need to more than double its current growth pace, which would bring it into line with Netflix’s current expansion rate. Can it be done? We’ve seen weirder things happen. For now, however, it seems Wall Street isn’t convinced.
Film and Television 