LOS ANGELES—In an interview with CNBC, Disney CEO Bob Iger noted that he was open to selling the streaming service Hulu, saying that “[e]verything is on the table right now, so I am not going to speculate whether we are a buyer or a seller of it. But I obviously have suggested that I’m concerned about undifferentiated general entertainment, particularly in the competitive landscape that we are operating in, and we are going to look at it very objectively and expansively.”
Disney has to either buy out Comcast’s one third stake or sell its stake to Comcast by 2024.
It is currently facing pressure from Wall Street to make its streaming business profitable. In its quarterly earnings call this week, Iger announced plans to cut costs by $5.5 billion dollars and ax 7,000 jobs as part of a larger restructuring.
"We are targeting $5.5 billion of cost savings across the company," Iger said. "First, reductions to our non-content costs will total roughly $2.5 billion not adjusted for inflation. $1 billion in savings is already underway....But in general, the savings will come from reductions in SG&A and other operating costs across the company. To help achieve this, we will be reducing our workforce by approximately 7,000 jobs. While this is necessary to address the challenges we are facing today, I do not make this decision lightly. I have enormous respect and appreciation for the talent and dedication of our employees worldwide and I am mindful of the personal impact of these changes. On the content side, we expect to deliver approximately $3 billion in savings over the next few years, excluding sports."
Most analysts had expected Disney to buyout Comcast but the pressure to cut costs and reduce debt may give Comcast an opening.
Comcast chairman and CEO Brian Roberts said in Sept. that it would like to buy Hulu, calling it a "phenomenal" business.
In its earnings report for Q1 of its 2023 fiscal year ending Dec. 31, 2022, Disney’s Direct-to-Consumer revenues increased 13% to $5.3 billion and operating loss increased $0.5 billion to $1.1 billion. The increase in operating loss was due to a higher loss at Disney+ and a decrease in results at Hulu, partially offset by improved results at ESPN+, Disney said.
Disney+ subs in the U.S. and Canada were virtually flat, rising from 46.4 million in October 1, 2022 to 46.6 million at the end of Dec. 31, 2022 while total Disney+ subs globally declined from 164.2 million to 161.8 million.
Hulu’s subs grew slightly from 47.2 million to 48 million, including its virtual pay TV service Hulu+ Live TV, which had 4.5 million subs.
ESPN+ also saw slow growth from 24.3 million to 24.9 million
