By Eva Mathews & Akash Sriram

(Reuters) – Walt Disney World was helped by the strong subscription additions to Disney+ during its most recent quarter. Disney (NYSE:) Co’s streaming service is closing the gap to market leader Netflix Inc (NASDAQ :). Industry watchers are focused on the future prospects of streaming in a saturated market.

Disney+ added 11.8 million https://reut.rs/3suczXC subscribers in the first quarter as viewers signed up to watch hits like “The Mandalorian” and “Black Widow”.

A closer examination of the numbers revealed that some of this boost came from Disney’s decision to bundle Disney+, ESPN+, and one tier of Hulu Live.

Moffett Nathanson’s analyst Michael Nathanson noted that Hulu Live automatically bundles 2 million users with their subscriptions, while Disney+ Hotstar generates around $1 monthly revenue for each user.

The media giant’s reaffirmation of its long-term goals and a forecast that the second half of the year would grow more strongly than the first half was in sharp contrast to Netflix’s gloomy outlook https://reut.rs/3rDdhTh last month.

Russ Mould (investment director at AJ Bell) stated that Disney might have more room on the streaming subscription side, but eventually it will reach saturation point.

Disney shares rose by more than 5% during early trading

Disney will defend its competitive position with older players for the moment, but this isn’t the walk in a park one might expect from an organization with a content cabinet already filled with blockbusters,” Sophie LundYates analyst Hargreaves Lansdown, LON:

Netflix is clearly still ahead of Disney in overall subscribers.

The streaming service, which has been around for two years, had 129.8 millions subscribers as of the end of 2013. Viewers paid to see “The Book of Boba Fett” and “The Beatles: Go Back”, as well as Oscar-nominated animation “Encanto”.

As of 2021, Netflix had approximately 222 million paid members.

Disney executives stressed local content’s importance as the U.S. markets saturates during its conference call following earnings. Rebecca Campbell was recently hired by Disney to increase its international content.

Netflix relies heavily on local production to combat the shortage of classic blockbusters. This has helped attract millions of international viewers with shows like “Squid Game”, Money Heist and “Lupin”.

Christine McCarthy, Disney’s finance chief, said that about one third of total expenditures is allocated to sports and the remaining for content.

“With Disney+ coming to 42 more countries in the summer of 2022, the international growth story may prove more important than the U.S.,” said Joe McCormack, senior analyst at Third Bridge.