CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved.

Disney rockets to record on blockbuster streaming service launch

Media giant's Disney+ hits phenomenal ten million subscribers just days after launch to general public, catapulting the company's stock to an all-time high.

Shares of The Walt Disney Company rocketed to a record high in New York trading today after the media behemoth announced that its new Disney+ streaming service amassed an astounding ten million subscribers just days after the product was made available to the general public in the US and Canada.

While the reaction to the news was euphoric, a deeper look at the numbers brings up big questions about just how profitable those ten million new subscribers are, if at all. Disney earlier this year reached a deal with mobile phone giant Verizon, the largest carrier in the US, to offer Disney+ free to Verizon's 38 million customers in exchange for a 'wholesale rate', which is likely significantly below the $7.00 monthly price tag to the general public. Disney did not break out the Verizon subscriber numbers.

Nevertheless, the ten million number is unprecedented - it took HBONow four years to reach that level - and streaming market leader Netflix took it on the chin in New York trading, falling nearly 5%, as investors switched out of Netflix stock and into Disney stock.

In after hours trading, Walt Disney Co (All Sessions) was up over 9% from the previous day's close.

Titanic struggle

In one of the most titanic corporate sagas of recent decades, deep pocketed giants like Apple, Disney, Comcast, Warner and others are piling into streaming, seeing those services as absolutely crucial to their survival. All seem willing to spend whatever it takes to survive the emerging streaming services war, which perhaps none will win. And most are likely to come out severely wounded.

A result of all the competition has been a huge film and TV production bubble as media players spend big on original content to entice subscribers. Competition for top producers, actors and writers is red hot, with exhorbitant sums being spent on big Hollywood names. And there have been a flurry of unknowns who have found themselves suddenly raking in millions when their film or show pitches become hot and bidding wars break out.

So far, Disney's profit track record is not good when it comes to streaming. Its Hulu service, available now for two years, has piled up nearly a half billion dollars in loses. And it's unclear whether streaming can replace Disney's rapidly declining bundled cable service product lines, as well as its other declining traditional media properties like the ABC television network.

Big cash flows

Nevertheless, Disney has enormous cash flows coming from its film business - it owns Marvel, Star Wars and Pixar, as well as the hugely profitable family film franchise. Earlier this year, in a blockbuster acqusition, Disney acquired 20th Century Fox's media assets. There are also the massively profitable theme parks.

These are very deep and diversified pockets indeed when compared to streaming one-trick pony Netflix, which is burdened with significat debt. But Netflix has a big lead with 160 million subscribers, and Disney's own forecast is for just 120 million Disney+ subscribers in five years.


The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.

Act on share opportunities today

Go long or short on thousands of international stocks with CFDs.

  • Get full exposure for a comparatively small deposit
  • Trade on spreads from just 0.1%
  • Get greater order book visibility with direct market access

See opportunity on a stock?

Try a risk-free trade in your demo account, and see whether you’re on to something.

  • Log in to your demo
  • Take your position
  • See whether your hunch pays off

See opportunity on a stock?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Trade a huge range of popular stocks
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See opportunity on a stock?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.