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DMBA630-Wk10_Revenueforecastandassumptions_2.docx

Revenue forecast and assumptions

For Disney+ and Hulu streaming service first year in Mexico, the annual forecast revenues is expect to reach $ 216,620,000 with 38,000,000 subscribers. Disney+ will enter into the Mexico streaming market by providing a low price with bundle service to compete with its competitors. First, we will be assuming that we will have at least a 14% increase of new Disney+ subscribers. After six months our subscribers will increase by a little more than 10% every month.

We also forecast Disney+ subscribers will continue to grow each month and there's no reason to believe that won't continue. By the end of the fourth quarter, revenue will reach up to $86,648,000. This will be accomplished by not only growing subscriber base but also by the company's pricing power. We are also assuming the average subscription price (ASP) grew 3% year over year, and excluding the impact of foreign exchange headwinds, international ASP increased by 6%.

The method used for this study is combination of aggressive and conservative methods, which eminently works best for Disney+. The assumptions made for forecasting are as follows:

· Offer different contents Hulu only, Disney+, and bundle

· Entry price are lower than competitors

· The revenues are expected to increase by more than 10% after 6 month

· Estimate to have 38,000,000 subscribers by at the end of the first year

· Partner with local cellular company to attract more subscribers

Disney+ and Hulu REVENUE Forecast and assumptions 

 

 

 

 

 

Year 1

Hulu

 

 

# of subscribers

 

9,000,000

Price persubscribers

 

4.99

Total

 

44,910,000

Disney+

 

 

# of subscribers

 

20,000,000

Price persubscribers

 

4.99

Total

 

$99,800,000

Bundle

 

 

# of subscribers

 

9,000,000

Price persubscribers

 

7.99

Total

 

71,910,000

 

 

 

 

 

 

Net Revenue

 

216,620,000

 

 

 

Months

 

Year 1

Month 1

 

0

Month 2

 

0

Month 3

 

0

Total 1st Quarter

 

0

Month 4

 

10,831,000

Month 5

 

17,329,600

Month 6

 

21,662,000

Total 2nd Quarter

 

49,822,600

Month 7

 

21,662,000

Month 8

 

25,994,400

Month 9

 

32,493,000

Total 3rd Quarter

 

80,149,400

Month 10

 

25,994,400

Month 11

 

28,160,600

Month 12

 

32,493,000

Total 4th Quarter

 

86,648,000

Total for year

 

216,620,000

 

 

 

Average Revenue

 

 

by Month

 

18,051,667

by Quarter

 

54,155,000

Month 1 Month 2 Month 3 Total 1st Quarter Month 4 Month 5 Month 6 Total 2nd Quarter Month 7 Month 8 Month 9 Total 3rd Quarter Month 10 Month 11 Month 12 Total 4th Quarter Month 1 Month 2 Month 3 Total 1st Quarter Month 4 Month 5 Month 6 Total 2nd Quarter Month 7 Month 8 Month 9 Total 3rd Quarter Month 10 Month 11 Month 12 Total 4th Quarter 0 0 0 0 10831000 17329600 21662000 49822600 21662000 25994400 32493000 80149400 25994400 28160600 32493000 86648000