Disney released its latest earnings report for the final quarter of 2023. It’s been a rollercoaster of a year, with TONS of big announcements, price increases, and leadership changes across the board.
Disney World
The Q4 earnings report gave us a look at how the company is doing in terms of general revenue, streaming, and more. We also learned how the Disney Parks have been doing financially, and it looks like Disney Parks are generally doing pretty well, with a couple of exceptions.
Disney Parks, Experiences, and Products revenues for the quarter increased overall by 13% from $7.253 billion in the same quarter last year to $8.16 billion this quarter. The segment operating income (the difference between segment net revenue and the sum of operating expenses and segment revenue) decreased 31% from $1.342 billion in 2022 to $1.759 billion this quarter.
©Disney
Although Disney saw an increase in revenue at both domestic and international parks, the increase was significantly higher at the international parks. Disney attributes the growth to a few specific factors: An increase in spending at Shanghai Disney Resort and Hong Kong Disneyland Resort due to ticket price increases along with increased attendance at both parks.
©Hong Kong Disneyland
The Florida Disney theme parks, by contrast, aren’t seeing the growth that investors were hoping for. In an interview with CNBC, Bob Iger noted that “blips come and go,” and he compared the downturn at the Florida theme parks to the downturn in tourism after the 2001 terrorist attack.
Cinderella Castle
In its earnings report, Disney stated that the lower financial results from the Florida theme parks were due to “accelerated depreciation related to the closure of Star Wars: Galactic Starcruiser” and “lower guest spending driven by a decrease in average daily hotel room rates.” Without the Star Wars hotel and with more hotel discounts, it seems that Disney World isn’t making as much money as expected.
The Star Wars hotel caused quite a few problems for Disney, beginning with some negative publicity once the pricing was released and was much higher than some guests were anticipating.
Star Wars Hotel
Disney executive Josh D’Amaro shared some details about why the Starcruiser failed and how it will affect The Walt Disney Company in an interview earlier this year. He said that the Galactic Starcruise hotel is “a pretty stunning asset.” He said, “It’s essentially a spaceship that guests board, themed out to feel exactly like Star Wars. Our Imagineers did an incredible job pulling this asset together, and our guests gave it very high ratings.” Despite those high ratings, however, D’Amaro said, “It didn’t perform exactly like we wanted it to perform, so we decided that we’re going to sunset this in September.”
Why the Star Wars Hotel Closed in Disney World
Iger was also asked about the $60 billion investment that Disney plans to make in its theme parks. He said, “If you look at our track record, it’s been stellar in terms of invested capital over the past 10 years. The investments have paid for themselves.” He went on to say, “We felt that in looking at the results of the parks, since the returns have been so good, why not invest more.”
DinoLand USA Expansion
Although growth in Florida was lower than expected, Disney noted that they were pleased with results at the Disney Cruise Line, which saw growth due to “increases in passenger cruise days and average ticket prices.”
Disney Wish
They also stated that Disney Vacation Club saw an increase in sales with the addition of the new The Villas at Disneyland Hotel in Disneyland.
New Villas
Disneyland overall saw more growth than Disney World, which Disney attributes to “higher attendance, increased in guest spending primarily due to higher average ticket prices, and higher costs due to inflation.”
Disneyland
We’ll be covering even more details about the Disney Q4 earnings call, so stay tuned to DFB for more!
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Interesting I read reviews from people who did the Starcruise hotel experience and said it definitely wasn’t worth the cost. So so much for people loving the experience. No wonder Disney World didn’t perform as expected. That will continue because the average family in the South and Northeast can no longer afford the prices. Iger thinks that people will continue to come and some will but as a DVC member coming from NJ my trips will be far less. Came just about every year except during pandemic once just my husband and I and once with family 14 in total. Use to buy Annual Passes but not worth it any more and cost of food at restaurants is ridiculous and not as good. Disney is not what it use to be. All the little perks were taken away fast pass, transportation, etc. For Iger who makes $33 Million a year cost may not be a problem but average households making $100 thousand a year or less its just not feasible anymore.
Disney should blame the morons who thought up this debacle in the first place! It didn’t take a brain surgeon to realize the hotel wasn’t going to make it!!!
Maybe now Disney Corp will realize that catering to the rich non-family guests was not Walt’s vision nor the reason for his success. Thie Star War’s Hotel was not for middle income families (especially with young children). Unfortunately, most new things brought into WDW are for the older crowds – Tron, Guardians and even Tiana’s Bayou cannot be enjoyed by toddlers. Than there is dinner at the Beast’s Castle. Definitely NOT for families. Young children don’t eat enough for the outrageous prices and a glimpse of the Beast is certainly not worth the money. Older children 9+ would never want to eat at a place like that.
Most reviewers, said it was a great experience. They also said it was too expensive for what you got. The problem wasn’t the concept but the cost.
Love Pris and Peg’s comments. Maybe its about time Disney Exec’s take a cut in salaries, bonuses and benefits before they think about raising any more prices in the parks. In fact – how about lowering prices and spend more money on entertainment instead of building hotels. Bring back the Luau, hotel character dinners’, the Adventurers Club in Disney springs, and nighttime parades in Magic Kingdom. All of these things will create shorter lines in the parks, giving guests more enjoyable time to spend more money.
Yes, Disney has its problems, but in a world filled with so much trouble and turmoil we need a magical happiest place on earth. Sure, few can afford to go there every year, but a lot of can go once in a while and then take a break every few days afterwards to relive the peace, joy, and happiness shown on the faces of the entire family in those precious photos we saved.
Totally agree, who in their right mind would have thought that was a good idea.
People can’t even afford the Value Resorts anymore, the prices are so high.
I agree with the food prices also, I am a senior and only eat enough for the kids meals.