Hulu’s losses spiked 73% to $920 million as the joint venture spent aggressively on original content and launched a virtual MVPD service.
The figures come via a 10-K filing by part owner Comcast, which were ground up by BTIG Research analyst Richard Greenfield, put in a centrifuge with SEC reports from Hulu’s other co-owners, then extrapolated upon.
Comcast, 21st Century Fox and The Walt Disney Company each own 30% shares in Hulu, while Time Warner Inc. owns the other 10%. Collectively, the four companies invested $1 billion in Hulu last year, the filing noted. Comcast said it individually plunged $300 million into the streaming company, recording a $276 million loss.
Hulu recorded losses of $531 million in 2016, with its four investors putting in $733 million.
Greenfield expects Hulu to lose even more money in 2018.
“We now expect Hulu’s losses to grow over 80% in calendar 2018 to nearly $1.7 billion with its four partners investing pro-rata an additional $1.50 billion,” Greenfield wrote in a note to investors.
Greenfield is noted for his long-running rhetorical battle with Disney. This time around, the attention-seeking analyst leveraged the Comcast disclosure to poke Disney for not providing enough transparency in regard to its Hulu investment.
“When Hulu’s losses and parent-company investment were relatively small, its ability to skew financials at its parent companies was modest,” Greenfield wrote. “However, now we know, via Disney, that Hulu’s losses will increase dramatically in 2018.
“The increased investment and losses are being used to buy content from Hulu’s parent entities, as Disney’s CFO pointed out, and to add vMVPD subscribers which boosts broadcast TV retrans fees and cable network affiliate fees for Hulu’s parent companies. Yet, we have virtually no disclosure on the positive impact Hulu’s spending is having on its parent companies.”