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Disney park revenue slumps in Orlando but grows globally

Revenue is up for Walt Disney Co.’s theme parks globally, but down at Walt Disney World, according to third-quarter financial results released by the company Wednesday.

CEO Robert Iger pointed to a flattening of attendance after the end of Disney World’s 50th anniversary celebration and other contributors for the dip.

“Also, as post-COVID pent-up demand continues to level off in Florida, local tax data shows evidence of some softening in several major Florida tourism markets, and the strong dollar is expected to continue tamping down international visitation to the state,” Iger said.

The company has been at odds with Gov. Ron DeSantis over the so-called “don’t say gay” law, which bans instruction about sexual orientation and gender identity in public schools.

Revenue was up 13% for Disney Parks, Experience and Products for the quarter ending July 1, compared with the year-earlier period. That segment includes the Disney theme parks in Asia, which saw a 94% increase in revenue.

“Both Shanghai Disney Resort and Hong Kong Disneyland have experienced stronger than expected recoveries from the pandemic,” Iger said. “And in Q3 they both grew meaningfully in revenue, operating income and attendance.”

But the performance in parks in Florida and California was a more sluggish 4% gain in revenue and a 13% decline in operating income compared with last year.

“While Disney World results were down year over year … operating income was nearly 30% higher versus 2019 when adjusting for the Starcruiser accelerated depreciation,” said Kevin Lansberry, interim CFO for Walt Disney Co.

In May, the company announced it will shut down Star Wars: Galactic Starcruiser, an immersive two-night experience at Disney World, in late September.

At Disney World, per capita spending “was comparable to the prior year with contributions from pricing, Genie+ and higher food and beverage being offset by attendance, compensation changes and lower merchandise spending” for the quarter, Lansberry said.

Disney Cruise Line showed strong revenue and income growth in the third quarter, Iger said.

“Current Q4 booking occupancy for our existing fleet of five ships is at 98%,” he said.

Overall, revenue for Walt Disney Co. was up 4% for the quarter, the report showed. Iger said management changes and efficiency improvements had created a more streamlined approach since he returned to the CEO position eight months ago.

“We aggressively reduced costs across the enterprise,” Iger said. “We’re on track to exceed our initial goal of $5.5 billion in savings.”

In an earnings call with analysts Wednesday, Disney officials also talked about changes at ESPN and its direct-to-consumer plans, a price increase for some Disney+ and Hulu packages, disappointing box-office figures for recent films and ongoing strikes by writers and actors in Hollywood.

“I have deep respect and appreciation for all those who are vital to the extraordinary creative engine that drives this company and our industry,” Iger said. “And it is my fervent hope that we quickly find solutions to the issues that have kept us apart these past few months. … I am personally committed to working to achieve these results.”


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