Walt Disney Co shares soared to a record high after the entertainment firm said its new streaming service, Disney+, had been met with “extraordinary consumer demand,” reaching 10 million sign-ups in its first day.
The strong performance, which added $18 billion to its market capitalization, appears to establish Disney as a leading player in the streaming wars that pit it against industry leader Netflix Inc, Amazon.com Inc’s Prime Video service, Apple Inc’s Apple TV+ and AT&T Inc’s forthcoming HBO Max service.
Combined with Disney’s other streaming businesses – Hulu, which has 26.8 million subscribers, and ESPN+, which serves 3.5 million subscribers – the company now serves 40.3 million viewers in the United States, compared to about 60 million for Netflix.
Disney shares rose 7.5% to $149 in late day trading on the New York Stock Exchange.
Disney+, which launched in the United States, Canada and the Netherlands on Tuesday, was hit with technical glitches that the company said were caused by higher-than-expected demand.
The service costs $7 per month and features roughly 500 movies and 7,500 TV episodes from the company’s deep family entertainment catalog, as well as new programming. A bundle including ESPN+ and Hulu costs $13.
In April, Disney said it plans to reach 60 million to 90 million Disney+ subscribers globally by 2024.
In a note on Wednesday, Wedbush analyst Daniel Ives wrote that at its current pace, Disney could hit that subscriber goal potentially two years earlier.
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