Disney closes gap with Netflix, shares jump

Shares of Disney jumped on Thursday after beating revenue and profit estimates, and strong subscriber growth by Disney+ showed it was closing the gap with market leader Netflix, clapping back to life investors' faith in the future of its two-year-old streaming service.

Disney+ added 11.8 million subscribers in the first quarter as viewers signed up to watch hits like "The Mandalorian," "Black Widow" and "The Beatles: Get Back."

And the company forecast stronger subscriber growth in the second half of the year than in the first half, a sharp contrast to Netflix's gloomy outlook last month, which sent its shares tumbling.

But one analyst said a closer look at Disney's numbers showed that some of the boost in subscriptions were the result of an automatic bundle with Hulu Live, and that 2.6 million subscribers came from a bundle with India-based Hotstar, which generates about $1 in monthly revenue per user.

Still, investors had more to cheer, as strong attendance at Disney's U.S. theme parks added luster to its quarterly results.

Revenue from parks, resorts, experiences and products reached above pre-pandemic levels, more than doubling to $7.23 billion in the quarter.

But Disney said it expects international parks to be impacted by the ongoing global health crisis for weeks to come.