Okay, Well, joining us now is that Gita Ranganatha Bloomberg Intelligence techn Media and is having a look at disney earnings, which came out essentially beat. We do have them topping those profit views, but it's also raising the price of its flagship Disney Plus streaming service. It's ad free version anyway, by thirty eight percent, all designed to generate more revenue. What did you make of the overall picture that Disney actually drew? So the overall picture, in my view, Rashad
was very very strong. So you know, we saw them come ahead of their streaming subscriber guidance or we were expecting about ten million subscribe new subscribers. They delivered about fourteen point four million. They confirmed that they're seeing an acceleration in that course of course subscription product through fiscal fourth quarter. So expect all their new content launches as well as their new market launches to kind of bear fruit as they finish out this fiscal year in September.
And then what you know, the question that the market has really been asking, which is do these streaming services have pricing power? And you know, Disney seems to think it does. There obviously, as you just pointed out, they're raising their prices, but they're also kind of cushioning that blow a little bit because they're offering on December eight, they're going to debut an add supported service at the same time, which basically means that anybody who wants to maybe, um,
you know, cut back on their expenses has that option. Uh, And so they're going to try and control chun in that way. So it's a it's a statement of confidence. Um, they're adding subscribers and they're raising prices, and and the market has picked up on this. It was already up four percent in the regular session and as Doug mentioned, gaining six point eight percent in in after hours, and in fact of late it has outperformed peers and it's also outperformed the SMP. That's all well and good, but
the stock was down pretty hard earlier. And one question remains, you know, partial looking good and all that, but does that continue if you go to recession? Probably not. Yeah,
that that's a very very important question. Brian and I think they were asked this question repeatedly on the call about any signs of softening that they're seeing with consumer spending, and their resounding answer and they kept repeating this was was no um and that even if there was a slight softening, which I think is inevitable, they have multiple
levers to keep that profit machine running. So what they've done is they have instituted, they've they've kind of taken their or they've used the pandemic very They've used that time really wisely to kind of implement all of these operational efficiencies. They have this new reservation system, they have this new virtual assistant called Genie Plus, which basically reduces uh,
you know, waiting times in lines. So they have all these things which kind of improve their real management kind of um, you know, spread out attendance, smoothing out any peaks and valleys. And what that has done is that has really kind of boosted profits immensely. And so we're seeing operating margins that are way higher than you know,
pre pandemic levels. And now what they're saying is that they're also seeing the benefit of international visitation kind of kicking in at the domestic parks and that should keep those margins at an elevated level. So is there a possibility that we see a slowdown? Yes, how bad is it going to be? Maybe not too bad, because I think they have multiple levels that they can kind of
pull well into. T thing is gither they have this amazing target for subscriber growth then they I think they said this a couple of years ago, and they're looking at what two sixty million of them by the fiscal two thousand and twenty four. Yes, they actually did walk that back a little bit. Um So one of the main growth drivers for subscribers to the Disney Plus service has that been their Indian streaming platform, which is called
hot Star. And the main reason why hot Star has been such a runaway success has been because of the cricket streaming rights that it that it boasts of, so it's called the Indian Premier League the I p L Cricket. Now, what Disney did is they made a very conscious decision to walk away from the streaming rights for you know, that that property because it was way too costly and it was going to kind of mess up their profitability goals. So with that in mind, they actually did walk back
guidance slightly. Uh So, now instead of two hundred instead of an upper range of about two hundred and sixty million, they're guiding to about two d thirty million, But I don't think the market is going to punish them for this only because this is mainly due to the fact that you know that the so so Hot Star subscriber essentially, yes, there's a lot of volume on that platform, but but the but the subscriber quality itself is pretty low because
they basically bring in about just one dollar per month versus about seven dollars for you know, a non Hot Star subscriber. So you know, profitability again is well intact, just a quick question. You know, we've had a lot of trouble in China with the lockdowns. How is China looking at the moment with the park there? Yeah, they
actually just just reopened the park in in Shanghai. They said it's you know, so far momentum has been good, but I think it's going to take a while for it to kind of really get back to full capacity. But so far it says it's pretty much in line
with expectations. It could be good down the road, I suppose, and also ESPN where it used to be one of the reasons you sold Disney now looking a lot better anyway out of time geta but always a pleasure love having you on the show geta Ranganathan Bloomberg Intelligence tech and media analyst. Boy, they've got some good people there. This is Bloomberg