Disney's Streaming Base Expands: Can Subscriber Growth Drive Gains?

Disney’s DIS streaming base is growing rapidly, underscoring its growing role in driving the company’s Entertainment strategy. In the third quarter of fiscal 2025, combined Disney+ and Hulu subscriptions climbed to 183 million, up 2.6 million sequentially. This momentum broadens the company’s advertising reach, strengthens bundling opportunities and enhances its ability to monetize subscribers through a sharper focus on Average Monthly Revenue Per Paid Subscriber (ARPU).Content is powering Disney’s streaming push, with profits funding a strong 2025 slate — Marvel Zombies (Sept. 24, 2025), Tron: Ares (Oct. 10, 2025), Predator: Badlands (Nov. 7, 2025), Zootopia 2 (Nov. 26, 2025) and Avatar: Fire and Ash (Dec. 19, 2025). These releases are expected to drive strong viewership, attract new subscribers and reinforce Disney’s competitive edge in the streaming market. Combined with personalization, pricing strategies and ESPN’s sports content, Disney is building a more balanced and resilient streaming portfolio for sustained growth.Disney is shifting from chasing subscriber counts to boosting ARPU and profitability. Recent price increases, ad-supported tiers and Hulu’s integration into Disney+ are central to that strategy, allowing the company to extract more value from its existing subscriber base.Looking ahead, management expects over 10 million net new subscriptions in the fourth quarter of fiscal 2025, largely via Hulu’s expanded Charter deal. The Zacks model forecasts the combined streaming base will rise to 185.4 million, further supporting optimism. Improving ARPU, supported by pricing, advertising and cross-platform synergies, positions Disney’s subscriber growth as a sustainable driver of both long-term gains and margin expansion.Disney & Rivals Face Off in Streaming Subscriber RaceWarner Bros. Discovery WBD is emerging as a key contender in streaming, emphasizing profitability and premium content. In the second quarter of 2025, WBD’s subscriber growth hit 125.7 million, boosting streaming revenues 9% year over year to $2.8 billion. With its strong HBO-driven library and expanding global reach, WBD aims for 150 million streaming subscribers by 2026 and $1.3 billion in profit in 2025, strengthening its position against Disney in the streaming subscription race.Netflix Inc. NFLX is considered Disney's strongest streaming rival, boasting over 300 million subscribers worldwide. Fueled by strong originals, international expansion, and disciplined content investment, the company continues to outpace competitors. Netflix's proprietary ad-tech platform adds high-margin revenues, enhancing monetization while keeping subscriptions attractive. With subscriber growth accelerating and profitability rising, Netflix is reinforcing its dominance in streaming and maintaining a competitive edge over Disney in the global subscription market.DIS’ Share Price Performance, Valuation & EstimatesDisney shares have gained 3.5% in the year-to-date period, underperforming both the Zacks Consumer Discretionary sector’s rise of 10.7% and the Zacks Media Conglomerates industry’s growth of 11.2%.DIS’s YTD Price PerformanceImage Source: Zacks Investment ResearchFrom a valuation standpoint, DIS stock is currently trading at a forward 12-month price/earnings ratio of 17.88X compared with the industry’s 20.47X. DIS has a Value Score of B.DIS’s ValuationImage Source: Zacks Investment ResearchThe Zacks Consensus Estimate for Disney’s fiscal 2025 and 2026 earnings is pegged at $5.86 and $6.49 per share, respectively, reflecting upward revisions over the past 30 and 60 days. These figures suggest year-over-year growth of 17.91% in fiscal 2025 and 10.69% in fiscal 2026.Image Source: Zacks Investment ResearchDIS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Radical New Technology Could Hand Investors Huge GainsQuantum Computing is the next technological revolution, and it could be even more advanced than AI.While some believed the technology was years away, it is already present and moving fast. Large hyperscalers, such as Microsoft, Google, Amazon, Oracle, and even Meta and Tesla, are scrambling to integrate quantum computing into their infrastructure.Senior Stock Strategist Kevin Cook reveals 7 carefully selected stocks poised to dominate the quantum computing landscape in his report, Beyond AI: The Quantum Leap in Computing Power.Kevin was among the early experts who recognized NVIDIA's enormous potential back in 2016. Now, he has keyed in on what could be "the next big thing" in quantum computing supremacy. Today, you have a rare chance to position your portfolio at the forefront of this opportunity.See Top Quantum Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Netflix, Inc. (NFLX): Free Stock Analysis Report The Walt Disney Company (DIS): Free Stock Analysis Report Warner Bros. Discovery, Inc. (WBD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks