Disney’s Move to Merge Hulu Into Disney+ Could Save Company Billions of Dollars

In 2026, Disney expects to shutter Hulu as a standalone app and service — and fully merge Hulu into Disney+.

Why did the Mouse House decide to essentially sunset the Hulu platform, which some users believe is superior to Disney+? Disney chief Bob Iger touted a number of benefits through the move, including increased engagement and lower churn rates.

More from Variety

Selena Gomez’s ‘Lizzie McGuire’ and ‘Suite Life’ Spinoffs Got Axed at Disney Before ‘Wizards of Waverly Place’: ‘I Was Kind of at My Wits’ End’
Midjourney Says Disney Cannot Prevent AI Training and Wants to ‘Have It Both Ways’
Disney Boss Bob Iger Says ‘Creating New IP’ Is of ‘Great Value’ but There’s No ‘Priority’ Among Sequels, Remakes and Originals: Just ‘Great Movies’

But a major boon for Disney should come on operating expenses. In fiscal 2025, Hulu will have programming costs of $4.1 billion and non-programming expenses of $2.9 billion — increasing to $4.4 billion in content costs and $3.3 billion in non-content costs by fiscal 2027, according to projections by MoffettNathanson analyst Robert Fishman. Disney has “an opportunity to drive additional cost efficiencies from the elimination of duplicative technology and administrative costs” at Hulu, he wrote in a July 14 note. According to Fishman, the benefits of combining Hulu with Disney+ are “likely still not fully captured in our current forecast.”

Of course, the entirety of Hulu’s non-programming costs will not magically go away even after it is fully subsumed into Disney+. And there will be cost involved in fully migrating Hulu, including the live TV streaming portion of the service, over to Disney+. But clearly, the elimination of Hulu’s independent technology stack does promise substantial savings.

Disney now owns 100% of Hulu after Disney finally closed its deal with Comcast to buy out NBCUniversal‘s one-third stake in the streamer in June 2025. On Disney’s earnings call Wednesday with analysts, Iger didn’t quantify expected cost synergies of the planned integration of Hulu into Disney+ although he said it would yield “operational efficiencies.”

“We obviously will deliver efficiencies. When these are together, they’ll be on one tech stack, as a for instance, one tech platform,” Iger said. He also noted that Disney has a unified sales approach for advertising across Hulu and Disney+, “but this will give our sales organization a chance to package them far more effectively than they have before.”

That said, the CEO largely focused on what he promised will be a “far better consumer experience.” “We are building on Disney’s value proposition in streaming by combining Hulu into Disney+ to create a unified app experience featuring branded and general entertainment news and sports, resulting in a one-of-a-kind entertainment destination for subscribers.” In addition, in the fall of 2025, Hulu will replace the Star tile on Disney+ internationally as the brand for adult-oriented programming.

According to Iger, “By creating a differentiated streaming offering, we will be providing subscribers tremendous choice, convenience, quality and enhanced personalization, while at the same time continuing to grow profitability and margins in our entertainment streaming business through expected higher engagement, lower churn, operational efficiencies and greater advertising revenue potential.”

“You’re going to end up with a far better consumer experience when [Hulu and Disney+] apps are combined by combining all of the program assets of both apps, both current apps, and obviously, with an improved consumer experience comes the ability to lower churn, which is obviously something that we’re very, very focused on and committed to doing,” Iger told analysts.

Customers will still be able to buy a stand-alone Hulu subscription as well as a stand-alone Disney+ plan, according to the company. But Iger sees the full Hulu-Disney+ integration as pushing bundle subscription rates even higher. Disney’s streaming team is “experimenting like crazy, where we’re basically trying different elements out on consumers and getting data back from them in order to figure out what works the best,” in terms of content presentation and recommendations, Iger said.

In an Aug. 6 research note, Fishman wrote, “Disney’s overall DTC strategy is crystallizing around a unified app experience. With Hulu now set to be fully integrated into Disney+, the company is streamlining its product and prioritizing one app for customer acquisition and retention,” Fishman wrote in an Aug. 6 note. He said the “clearest investment” will come in the form of product improvements, particularly around “more efficient and effective recommendation algorithms, which should drive stronger engagement and churn reduction.”

Pictured top: The current Hulu hub on Disney+, first introduced in the spring of 2024

Best of Variety