Disney to Combine Disney+ and Hulu into One App by End of Year

Disney will roll out a single streaming app with programming from Hulu and Disney+ by the end of the year.

CEO Bob Iger made the announcement during the company’s fiscal second-quarter earnings call.

He described the move as a “logical progression of our DTC offerings" and added that Disney+, Hulu, and ESPN+ will continue to be available as stand-alone services.  The three have been offered as a discount-priced bundle since 2020, with the combo helping to drive subscriber acquisition across all of the services.

Iger pointed out that the company would be “rationalizing” the volume and investment in streaming content, though he didn’t offer specific details. 

"Pricing would also be increasing along with the new consolidation plan. CFO Christine McCarthy said the company would take a $1.5 billion to $1.8 billion impairment charge related to content cuts and other streamlining in the company’s streaming operation," he added.

"Disney has attracted 5,000 total advertisers, helped by the new horizons of streaming,". 

The single app is expected to bring greater opportunities for advertisers, while giving bundle subscribers access to more robust and streamlined content, resulting in greater audience engagement and ultimately leading to a more unified streaming experience.

Since Disney took operational control of Hulu in 2019, speculation has been growing about a newly consolidated structure for streaming.

Hulu is approaching a crossroads in early 2024, which is when a put/call option kicks in for Disney and Comcast, which still owns one-third of Hulu. 

Disney would to required to pay Comcast at least $9 billion to buy out that one-third stake, with the exact valuation to be determined by an arbitrator. The floor amount of $27 billion for all of Hulu was stipulated in the original agreement in 2019, which followed the close of Disney’s $71.3 billion acquisition of most of 21st Century Fox, an original stakeholder in Hulu.

The single app news came after the company reported solid results for its fiscal second quarter, which ended April 1. Streaming losses moderated in the quarter, however, a strong showing by theme parks relative to the Covid-hobbled 2022 quarter powered the overall numbers, which met or slightly exceeded Wall Street expectations.

“We are confident we are on the right path toward streaming profitability,” Iger said.