Disney hikes streaming prices, focuses on costs as Iger moves to reassure investors
By Dawn Chmielewski
(Reuters) -Walt Disney said on Wednesday it would raise prices of its streaming service Disney+ in October, the second price hike this year, and CEO Bob Iger emphasized the company's efforts to keep a lid on costs as he tried to reassure investors.
The company beat Wall Street's profit expectations for its fiscal third quarter and said it was on track to cut costs by more than the $5.5 billion it promised investors in February.
Shares were last up 3% in extended trading, reversing losses after the entertainment conglomerate posted quarterly revenue below expectations and fell slightly behind analyst projections for U.S. subscribers of Disney+.
Iger, who returned for a second stint running Disney, said in a statement that Disney was undergoing an «unprecedented transformation» to help it become more efficient.
«I can't emphasize enough the time that we spent, and the effort that we spent, on managing costs,» Iger told analysts on a conference call, referring to the company's streaming business. «We have done a tremendous job in a very, very short time.»
Iger, who faces formidable challenges on nearly all fronts of the entertainment empire, acknowledged that Disney still has work to do to make the streaming business profitable.
Disney will raise by 27% the price of the ad-free tier of the Disney+ service to $13.99 and hike by 20% the no-ad version of Hulu.
Looking for ways to attract and retain subscribers in a competitive streaming market, Disney also announced it would launch ad-supported streaming in Europe and Canada and provide U.S. subscribers with a new, ad-free package in coming months.
Iger said he would address the issue of password sharing next year, echoing Netflix (NASDAQ:NFLX), which has
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