Hulu and Disney+ are losing subscribers as the streaming industry struggles to turn a profit (2024)
Only three U.S. video subscription services have managed to turn a profit in the 17 years since Netflix launched the streaming revolution: Netflix, Hulu, and most recently Warner Bros. Discovery.
One reason is that videostreaming services have done a terrible job at keeping subscribers. In the last four years, the weighted average churn rate for U.S. streamers has almost tripled to 5.5%, according to a new report from the streaming analytics firm Antenna.
In 2023, that meant that, although streamers gained 164.7 million gross subscriptions, they also recorded 140 million cancellations, leaving them with a net of 24.2 million new subscriptions.
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On top of that, gross subscriptions are slowing down. Subscription growth fell to 10.1% year-over-year in 2023, down from 21.6% in 2022.
Why streamers are losing subscribers
Recent trends in the industry — such as a crackdown on passwords, price hikes, and additional advertising — has turned off consumers and has led to arise in visits to piracy websites.
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Netflix, Disney+, Hulu, and Spotify all increased their rates in 2023, withNetflix and Disney+ adding ad spots to some of their formerly commercial-free plans in late 2022.
Some streamers have already lost net subscribers this past year. Subscribers to Disney+ fell 7% to 150 million in the three months ending Dec. 30, from 160 million,while Hulu’s subscribers in the same time period fell 3% to 48 million.
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In Antenna’s Q1’24 State of Subscriptions Report, the firm said streamers are now entering into a new era where they need to focus on retention.
“The previous stage was hyper-focused on acquisition – which made sense, as these new brands had to establish a mass audience,” Antenna CEO Jonathan Carson wrote in the report. “But now that the largest players have that scale (and the niche players have introduced themselves to their target audiences), they must shift their focus to managing their subscribers.”
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Not all the news lately is bad. Antenna pointed out that one in three users who cancel a subscription to a streaming service come back within six months.
Why streamers are losing subscribers. Recent trends in the industry — such as a crackdown on passwords, price hikes, and additional advertising — has turned off consumers and has led to a rise in visits to piracy websites.
Streaming revolt: Customers turn their backs on Netflix, Hulu, and Prime amid skyrocketing prices, annoying ads, and unwatchable shows. More and more Americans are canceling their streaming subscriptions.
Consumers were left picking up the tab for blockbuster furlough payments creating a global cost of living crisis that endures to this day. It led to people cutting their streaming subscriptions and left Disney with a loss-making platform.
Disney's streaming business has finally become profitable. In its Q3 earnings results released on Wednesday, the company reported making $47 million off Disney Plus, Hulu, and ESPN Plus.
But parks show signs of trouble. Disney's streaming business notched $47 million in operating income, compared with a loss of $512 million a year earlier.
Disney+ lost 1.3 million subscribers in the final quarter of 2023 amid a hefty price hike that went into effect last fall, but managed to narrow its streaming business' losses by $300 million during the October-December period.
Clear cache and data: You can typically clear cache/data via your device's settings menu. This step removes temporary files to help free up needed space. Uninstall/reinstall Hulu: On select devices, you can uninstall and reinstall the Hulu app which may help alleviate any streaming issues.
Apple TV+ has lost 528,285 paid subscribers so far this year, and Disney-controlled Hulu is close behind with a loss of 504,426. Disney+ lost the least number of subscribers on the year at 294,956 but still has more paid subscribers than any other service in the red at 29.2 million.
Disney's entertainment direct-to-consumer business, encompassing Disney+, Hulu and Disney+ Hotstar, turned a profit in the quarter: Operating income was $47 million (compared with a loss of $587 million a year ago) on revenue of $5.64 billion (up 13%) for the period, which was the company's Q2 of fiscal 2024.
Disney is a diversified global entertainment company that operates theme parks, resorts, and television networks and streams TV shows and movies. Disney's Linear Networks division for cable and broadcast television programming currently generates the most revenue for the company.
For well over a year, the company's promised a streaming swing to the black in the 2024 fiscal fourth quarter but nailed it earlier, reporting $47 million in DTC operating income in Q3 (vs a $512 million loss the year before).
You're probably paying more for streaming services that you did two years ago. So you may be surprised to learn that among all the streaming platforms, only Netflix and Disney turn a profit.
Hulu is removing several classic shows from its streaming service, including Arrested Development and 90210. Some shows like the sci-fi series Dollhouse don't have another streaming platform. These shows are being removed because their licensing agreements have reached their end and Hulu has chosen not to renew them.
Major platforms such as AppleTV+, Amazon Prime Video, Max, Peaco*ck, Paramount+, Netflix, Hulu, and Disney+ have all witnessed a considerable decline in subscribers. Approximately 25% of US subscribers have canceled at least three of these services, signaling a troubling trend for the industry.
When Hulu uses too much cache memory on your device, this can lead to freezing or crashing streaming sessions. If using Hulu in your browser, clear the browser cache. Also, clear your system cache on Windows or on your Mac.
Hulu may log you out if there's a problem with the app, such as bad files in the cache or a compatibility issue with your smart TV, phone, or streaming device. Frequent sign-outs also occur due to billing issues, screen limits, or your device's sleep settings.
Introduction: My name is Francesca Jacobs Ret, I am a innocent, super, beautiful, charming, lucky, gentle, clever person who loves writing and wants to share my knowledge and understanding with you.
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