Hulu LLC is seeking to boost its subscriber count and revenue with the addition of new channels. The Santa Monica-based streaming service announced at the beginning of the month that its live TV lineup will now include PBS Kids, the Warner Bros. Discovery-owned Magnolia Network and local PBS affiliate networks.

This content expansion announcement came just ahead of a larger update from Hulu’s majority owner, the Walt Disney Co., based in Burbank. After releasing its second-quarter financial results for the year, Disney announced on May 10 that it would be combining Hulu and its own Disney+ app into a single platform by the end of the year. 

Disney Chief Executive Bob Iger also announced plans to raise the price of its ad-free option for Disney+, which already offers a bundle deal with Hulu to subscribers, and “rationalize” the volume of content being produced and its production budget.

Hulu is nearing a crossroads. As early as 2024, Disney can require Comcast Corp., which owns 33% of Hulu, to sell Disney its stake in Hulu. Disney will need to pay Comcast at least $9 billion if it chooses to force a sale. 

Iger said during the second-quarter earnings call that, while he couldn’t say whether it would choose to buy Comcast’s Hulu stake next year, combining the two platforms into one application would increase ad revenue and user engagement. 

Iger previously said that “everything was on the table” regarding Hulu’s future. Neither Hulu nor Disney responded to requests for comment.

“This is a logical progression of our direct-to-consumer offerings that will provide greater opportunities for advertisers while giving bundle subscribers access to more robust and streamlined content,” Iger said on the call.

Disney’s second-quarter financial report said that Hulu’s operating income had decreased due to higher programming and production costs and lower ad revenue. While Disney’s direct-to-consumer revenue increased 12% year over year, losses at Hulu offset improvements at Disney+ and ESPN+. 

Hulu reported 48.2 million total paid subscribers in the second quarter of 2023, 4.4 million of which subscribed to both its Live TV offering as well as its streaming video on demand, or SVOD, service. Disney+ had 46.3 million paid subscribers domestically. 

Hulu’s Live TV service brings in more average monthly revenue per paid subscriber — ARPU — than its SVOD platform: SVOD brought in $11.73, while subscribers with both Live TV with and SVOD earned Hulu $92.32 ARPU. 

“Where we are headed is for one experience that would have general entertainment and Disney+ content together,” Iger said. “How that ultimately unfolds is, to some extent, in the hands of Comcast and in the hands of … a negotiation that we have with them.”