Walt Disney reported fiscal fourth-quarter earnings and revenue that easily topped analysts’ expectations on Thursday.
Twenty-First Century Fox.
Longtime CEO Bob Iger has said that the purpose of the Fox deal is to expand the entertainment giant’s content library as Disney prepares to launch its own streaming service in 2019, which Iger announced Thursday would be named Disney+. That service will host Disney’s family oriented programming, Iger said.
Through its acquisition of Fox assets, Disney has also doubled its stake in the streaming service Hulu.
In an interview with CNBC’s Julia Boorstin, Iger said that Disney is “investing substantially in original content.” While he said it was “premature” to say whether Disney would pursue acquiring the 40 percent of Hulu it does not own, Iger said Disney would certainly be interested if Comcast or Warner Media wanted to divest their stakes.
In a Thursday earnings call, Iger said that Disney sees an opportunity to increase investment in Hulu, particularly in its programming. He said the acquisition of Fox assets gives Disney rights to valuable intellectual property as well as a greater pool of talent, particularly in television.
“We aim to use the television production capabilities of the combined company to fuel Hulu with a lot more original programming, original programming that we feel will enable Hulu to compete even more aggressively in the marketplace,” Iger said.
Hulu already has an advantage when it comes to demographics, Iger said. When you compare the demographics on Hulu with that of viewers of the same shows on traditional network television, Iger claimed that Hulu’s audience can sometimes be 20 years younger.
“That’s clearly attractive to advertisers, which I think has been somewhat underappreciated about Hulu in that it is a very strong play for advertisers because it can offer targeted ads and it has great demos and it’s just a great user experience,” he said.
Disney has been experimenting with over-the-top video offerings, as it works to adjust to changing consumer behavior. In April, Disney launched ESPN+ and surprised analysts by notching more than 1 million paid subscribers in just five months.
The company also said it was taking a $157 million write-down on its investment in Vice Media.
Disney shares have gained 7 percent so far this year, hitting a 52-week intraday high of $119.69 on Oct. 22.
Disclosure: Comcast is the owner of NBCUniversal, parent company of CNBC and CNBC.com. Comcast is also a co-owner of Hulu.