Posted on

Disney shares sink nearly 9% after the company reports streaming subscriber losses


The Disney+ logo is displayed on a TV screen in Paris, December 26, 2019.Chesnot | Getty ImagesDisney shares are down about 9% Thursday after the company reported subscriber losses at Disney+ during the most recent quarter.The company, which posted profit and revenue for the period that were in line with Wall Street estimates, reported a loss of four million Disney+ subscribers. That downtick was offset by price increases, which led to a narrowing of operating losses at the streaming unit by $400 million for the fiscal second quarter.related investing newsStill, Wall Street expected a gain of more than one million Disney+ subscribers, according to StreetAccount, and the surprise subscriber loss spooked the Street.Shares of the company were trading at around $92 per share Thursday. The stock had been up over 16% so far this year as of Wednesday’s close.The drop was set to erase about $15 billion from the company’s market value.Stock Chart IconStock chart icon Disney’s stock sank on Thursday following its fiscal second-quarter earnings report.Disney will face headwinds from reductions in ad budget, intense streaming competition with Netflix’s new ad tier and continued economic uncertainty, according to a note from Paul Verna, principal analyst at research firm Insider Intelligence.”While Disney managed to stem its streaming revenue losses, it did so mainly by raising prices, and that strategy is not sustainable in the long term,” Verna wrote. “Disney plans another price hike later this year, but it will soon run out of headroom for further increases.”Analysts at SVB MoffettNathanson lowered their price target for the stock by $3 to $127 following the report, but maintained the firm’s outperform rating. The firm sees aggrega …

Read More