Disney (NYSE:DIS) reported robust subscriber numbers for its Disney+ streaming service when first-quarter earnings came out the other day, but the totals were surprisingly strong even with the heightened expectations.

The entertainment giant said Disney+ amassed 26.5 million subscribers in the quarter, nearly as many as its sister service Hulu has after 10 years in business (27.2 million). And by Monday, when it held its earnings conference call, Disney+ had leaped higher by another 2 million subscribers to hit 28.6 million.

Those are some phenomenal numbers for a brand new service (Netflix reported 67 million subscribers last month after 23 years), but investors should curb their enthusiasm because we still need to see how many subscribers stick around.

The Child, or as it's more commonly referred, Baby Yoda.

Baby Yoda, a star of Disney+. Image source: Disney.

Things are looking up

There is good reason to be hopeful. Disney said 10 million people subscribed on the very first day. And half the total number of subscribers came directly through Disney+ itself, which is probably why average revenue per user (ARPU) ended the quarter at $5.56, a healthy figure on a $7 product when there were a lot of discounts available for the service.

Disney offered some of those discounts itself. For example, it bundled the service with subscriptions to Hulu and ESPN, which CEO Bob Iger admitted was done in part to limit customer churn.

No doubt quite a lot of people subscribed to the service because of the new Star Wars series The Mandalorian, particularly as Baby Yoda helped it build buzz throughout the season. Disney undoubtedly anticipated a good number of subscribers would cancel after the season ended, so by tying them to another service through the bundle, it minimized those losses. 

Also, this quarter represented mostly a U.S. launch, but it will be rolling out in many major European markets on March 24. So while the numbers were very good, there is still pretty much the rest of the world to conquer.

Lending a hand

But there's also reason for caution. As many subscribers as Disney itself brought in, about half of the rest came through its partners. 

Verizon, for example, brought in the most, some 20% of the total, which would equate to about 5 million subscribers. It offered a free year of the streaming service to new FiOS home internet and new 5G home internet customers, as well as to new and existing Verizon Wireless unlimited customers. It's how I got the service.

The remaining 30% came through a variety of other platforms that are distributing the Disney+ app, including Apple through iTunes, Roku through The Roku Channel, Alphabet's Google, Microsoft, and Sony.

Disney is sharing revenue with these partners for channeling subscribers to the streaming service, so as strong as its ARPU numbers are, they could be stronger. And as my Motley Fool colleague Jeremy Bowman points out, the $7 per month subscription price leaves a lot of profits on the table.

What investors need to watch for is how many subscribers stick around after their free trial or discounted subscription expires. AT&T's HBO routinely saw wide fluctuations in subscribers based on the ebb and flow of when the Game of Thrones series aired.

While Disney has a lot of legendary and must-see content in its library, and it noted 65% of its subscribers watched other programs after watching The Mandalorian, that may change when people are paying the full subscription rate or if the price goes up.

Waiting is the hard part

There is little question Disney has a hit on its hands, and there's nothing to say it won't grow massively bigger still. But as the company itself seems to understand, it needs time to play out, even if the stock market seemed disappointed that it didn't upgrade its outlook for the service. 

Disney has estimated it could have between 60 million to 90 million subscribers by 2024, with as many as 30 million coming from the U.S. alone. Since it's almost reached that goal already, not raising the numbers was partly responsible for Disney's stock falling afterward.

Yet as Iger said, "It's far too early for us after basically a quarter and a little bit more under our belt to change our guidance." With the rest of the world still to come, and still no indication whether subscribers will be fickle after their free or discounted ride is over, there's plenty of time to see if the enthusiasm is warranted.