Netflix Surpasses Disney in Profits 20x

As a dedicated movie enthusiast, I’ve got to say that recent statistics from the streaming titans, Netflix and Disney, paint a fascinating picture. The numbers clearly demonstrate Netflix’s escalating supremacy, while at the same time, they underline Disney+’s ongoing challenge in living up to its initial promises of scale and profitability. Now, I must admit, YouTube is undeniably leading the pack in terms of ratings, audience, earnings, and so on. However, considering how significantly it outperforms all other streaming contenders, we might as well park that discussion for another day.

I’d like you to read the article. (Thanks
in advance!). That said, the headline gets right to it:

“YouTube is about to eclipse Disney as the biggest media company in the world.”

— Peter Kafka (@pkafka) March 31, 2025

In the year 2024, Netflix announced a remarkable earnings of $33.7 billion, representing a 16% rise compared to the previous year. Notably, their operating profit skyrocketed by an astounding 49%, breaking through the $10 billion barrier for the very first time, ending at a staggering $10.4 billion. The streaming colossus added 9.5 million new subscribers in 2024 alone, bringing their global subscriber base to an impressive 301.6 million users worldwide. Looking forward to 2025, Netflix anticipates robust growth, projecting revenue between $43.5 billion and $44.5 billion, signifying a potential 12-14% rise in annual earnings.

Compared to Netflix, Disney’s streaming services (Disney+ and Hulu, excluding ESPN+) showed smaller but growing figures in 2024, generating $23.3 billion in revenue, a 13% increase from the previous year. Notably, Disney moved from a loss to profitability with a gain of approximately $574 million. However, this profit is relatively small compared to Netflix’s massive earnings. It’s important to consider that Disney’s growth might be due to Hulu and its acquisition, while Disney+ may have plateaued. Disney doesn’t publicly disclose the individual revenue figures for these two streaming platforms. Interestingly, they do report on consumption and ratings when combining all three services (Disney+, Hulu, and ESPN+).

Despite Disney CEO Bob Iger highlighting the company’s strategic advantages, citing subscriber growth, revenue boost, and transition to profitability as signs of success, it is clear that Disney’s streaming sector has significantly underperformed initial predictions. After spending reportedly astronomical sums on acquiring Hulu and launching Disney+, the platform has faced challenges in achieving substantial profitability. With substantial investments in original content such as “Shōgun,” “Agatha All Along,” and “Only Murders in the Building,” the platform’s struggle to reach scale-wide profitability is evident. It takes a considerable amount of time to recover from being billions of dollars in debt with statements about “swings to profitability.” Disney’s financial performance, particularly in their streaming sector, can sometimes be elusive and confusing, making it challenging to fully grasp the actual state of their streaming revenues.

For instance, Disney announced in late 2024 that their streaming services recorded $324M in “operating income” for the first time achieving profitability in the previous quarter — however, “operating income” and “profit” are not synonymous terms. The actual net profit after taxes and other adjustments in Q4 of 2024 remains unclear.

Additionally, Disney’s significant reduction of Disney+ prices, making it available for only $2.99 a month for four months in March, suggests potential vulnerabilities rather than resilience. This kind of steep discount is often indicative of challenges in gaining and maintaining subscribers. In comparison, Netflix has mostly avoided deep price reductions, which underscores the strength of its subscriber base and its capacity to maintain pricing power without compromising profitability.

Comparing Disney’s spending on their streaming services like Disney+ and Hulu to their earnings more clearly reveals the challenges they face in this area. The costs associated with acquiring, launching, and expanding these platforms amount to tens of billions of dollars, significantly outweighing the $574 million shift in profit. This is particularly evident when contrasted with Netflix’s substantial annual profit of $10.4 billion, which highlights that Disney’s profits from their large-scale investments have been relatively meager compared to their competitors.

Netflix’s consistent expansion and financial prosperity show that their business strategy is flourishing due to strong consumer loyalty, high-quality content, and technological dominance in the worldwide streaming market. Despite Disney’s undeniable might in conventional entertainment, they have yet to effectively mimic Netflix’s streaming success.

Even though Disney sees some success with its streaming service, it lags significantly behind Netflix, which serves as a model for the entire industry. Given the substantial investment made and the relatively low financial returns so far, Disney+ could be seen as a less than satisfying endeavor, especially when compared to Netflix’s evident dominance and profitability.

2025-04-11 19:55

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