(Reuters) -Walt Disney Co’s Disney+ subscriber growth restored faith in the future of streaming video and came on top of strong demand at U.S. theme parks, lifting shares 8% after hours Wednesday.
Speaking on CNBC Wednesday, Disney Chief Executive Bob Chapek reaffirmed the Disney+ subscriber target of 230 million to 260 million by 2024. The company added 11.8 million Disney+ subscribers in the first quarter.
The company’s overall revenue rose 34% to $21.82 billion in the quarter ended Jan. 1, topping analysts’ estimate of $20.91 billion, according to Refinitiv data.
Disney+, the company’s two-year-old streaming service kept the business afloat when the pandemic disrupted its legacy theme parks, resorts and cruise operations.
Now, the relaxing of government restrictions and pent-up demand has led to strong attendance at domestic theme parks as Omicron fears have receded.
Excluding items, Disney earned $1.06 per share, blowing past Wall Street’s estimate of 63 cents.
“This marks the final year of the Walt Disney (NYSE:DIS) Company’s first century, and performance like this coupled with our unmatched collection of assets and platforms, creative capabilities, and unique place in the culture give me great confidence we will continue to define entertainment for the next 100 years,” said Chapek.
Revenue in the parks, experiences and products segment more than doubled to $7.23 billion in the first quarter.
Meanwhile, operating income in the segment stood at $2.45 billion, versus an operating loss of $119 million a year ago.
Disney+ subscribers stood at 129.8 million at the end of the first quarter, compared with Factset estimates of 129.2 million.
Investors are watching the streaming service’s growth trajectory as it relates to its ability to reach fiscal 2024 guidance. Chief Executive Bob Chapek on Wednesday stuck by the company’s previous forecast of 230 million to 260 million Disney+ subscribers by the end of fiscal 2024.
Disney has poured billions into creating new programming to grab a share of the online video market dominated by Netflix Inc (NASDAQ:NFLX), staking its future on a direct-to-consumer strategy.
Its much anticipated “Obi-Wan Kenobi” series will premier on Disney+ on May 25, Chapek said.
During the first quarter, Disney+ released the first episode of “The Book of Boba Fett,” about the Star Wars bounty hunter; “The Beatles: Get Back” documentary series from filmmaker Peter Jackson, and “Hawkeye,” about the Marvel superhero.
Disney announced in November that it would offer a bundle of its three streaming services, Disney+, Hulu and ESPN+, for $13.99 per month.
In January, Netflix forecast weak first-quarter subscriber growth, which sent shares down nearly 20% and erased most of its remaining pandemic-fueled gains from 2020.