×

Disney Projected to Top 130 Million Online Video Subscribers in 5 Years (Analyst)

Disney could have more than 130 million subscribers across its online video services worldwide by 2024, Morgan Stanley analyst Benjamin Swinburne projected in a note to investors Thursday. The forecast resulted in Disney shares trading up 4.4%, while Netflix shares were down 1%.

In the near term, Swinburne expects Disney to sign up 13 million subscribers by the end of 2020. At that point, Disney could have a total of 50 million subscribers across Disney Plus, Hulu and ESPN Plus.

Swinburne based his projections on Disney’s faster-than-expected international launch plans for its upcoming Disney Plus service. Disney Plus is scheduled to launch in the U.S. in November, and then come to Western Europe in late 2019 and early 2020. Roll-out across the Asia-Pacific region will  begin in late 2019 and continue through 2021, while a launch in Latin America is planned for early 2021.

At the low end, Disney Plus should gain 60-90 million subscribers in 5 years, Swinburne argued, noting that this would only represent 10% of addressable broadband homes, compared to the 25-30% that Netflix has been able to capture. Even with those conservative numbers, Disney Plus could be profitable by 2024, thanks in part to the fact that the company will need to spend less on brand advertising.

Swinburne also addressed concerns that Disney Plus could cannibalize other revenue streams. “While all valid concerns, we believe the market has often overstated the risk and underappreciated the reward of the transition to streaming,” he wrote. “Stepping back and admittedly taking the long view, investing in Disney shares is a play on the durability of its IP.”

However, Swinburne also cautioned that Disney may face some challenges as it shifts key parts of its business to online video. “Disney is not a tech company in its DNA, nor does it have a long history as a direct-to-consumer digital retailer,” he wrote.

Disney shares jumped $6.02 to $141.74 a share on the New York Stock Exchange on Thursday. Disney stock hit a record high of $142.35 a share in April following the release of mega-hit “Avengers: Endgame.”

Shares of Netflix declined by $2.13 to $343.43 on the Nasdaq on Thursday.

More Digital

  • iHeartMedia-Pride-Media-TheOutcast-Logo

    iHeartMedia, Pride Media to Co-Produce Slate of LGBTQ+ Podcasts

    iHeartMedia is teaming with Pride Media, the media company whose brands include Out, The Advocate and Pride, to co-produce a slate of LGBTQ+ podcasts in 2019-20. The partnership will kick off with “The Outcast,” an iHeartRadio original podcast co-produced with Out Magazine. Hosted by Out Magazine deputy editor Fran Tirado, the weekly podcast will explore [...]

  • Netflix Reed Hastings

    Netflix Shares Dive After Q2 Stumble: Just a Hiccup or Sign of Bigger Trouble?

    Netflix badly undershot its subscriber forecasts for the second quarter of 2019 — posting its first net U.S. customer decline since 2011 while growth slowed considerably overseas. The company added 2.7 million subs worldwide, almost half as many as the 5 million it had projected. With the big miss, Netflix shares took a predictable hit, [...]

  • Terminator: Dark Fate

    Comic-Con: ‘Terminator: Dark Fate’ Cast Will Hit Reddit Live-Streamed AMA (EXCLUSIVE)

    Arnold is back — and he and other cast members of “Terminator: Dark Fate” are joining a first-of-its-kind live-streaming Reddit AMA on Thursday from Comic-Con International in San Diego. For the new installment in the “Terminator” franchise, Paramount Pictures is hosting a traditional Comic-Con panel Thursday 11 a.m.-12 noon in Hall H. Then, a few [...]

  • Time Immersive app

    Time Immersive App Launches With Moon Landing AR Experience

    Time launched a new mobile app for immersive journalism Thursday, complete with an augmented reality experience that visualizes the moon landing in a user’s living room. “Landing on the Moon” has been produced with help from Industrial Light & Magic chief creative officer John Knoll, who has been researching the Apollo 11 mission for close [...]

  • Illustration of the video streaming company

    Netflix Insists It Won't Move Into Selling Advertising

    Netflix wants you to know: It doesn’t have any plans now or in the future to start running commercials on its streaming service. Company execs have have regularly explained that being ad-free is a core part of Netflix’s attractiveness to consumers, and the strategy has been a standard part of its “Long-Term View” mission statement [...]

  • MODEL RELEASED Hand holding iPhone with

    Netflix to Launch Lower-Priced Mobile-Only Plan in India

    Following several months of testing, Netflix is getting ready to officially launch a mobile-only plan in India. Priced significantly below its regular subscription plans, the new plan is meant to help the company better compete with local players like Hotstar. Netflix announced the step in its Q2 2019 earnings letter to investors Wednesday, writing: “We [...]

More From Our Brands

Access exclusive content