Q4 Earnings Report Shows Increase In Theme Park Profits
Today the Walt Disney Company reported on its Q4 earnings with CEO Bob Chapek at the helm. Many areas of operations were discuss including subscriber numbers going into the second year of Disney+, overall revenue etc. However, to kick off things, I thought I’d give you some insights into how things are shaping up at Disney’s theme parks.
Overall it’s good news for Disney Parks, Experiences and Products revenue which saw an increase of $5.5 billion compared to $2.7 billion in the prior-year quarter. Segment operating results increased $1.6 billion compared to an income of $640 million.
Bob Chapek, CEO at the Walt Disney Company reflected on Q4 earnings saying, “This has been a very productive year for The Walt Disney Company, as we’ve made great strides in
reopening our businesses while taking meaningful and innovative steps in Direct-to-Consumer and at our Parks, particularly with our popular new Disney Genie and Magic Key offerings.”
It certainly isn’t a surprise that operating income was up in the Disney Parks, Experience and Products segment given the revenue lost in 2020 due to closures and reduced operating capacity as a result of the pandemic.
Though results have improved in the second half of this year, the Walt Disney Company is still impacted by reduced operating capacities.
Image Credit: Jeff Gritchen, Orange County Register
Much of the success this quarter from a theme park perspective is reflective of an increase of attendance at domestic and international parks when compared to last year.
In the same quarter of 2020, Shanghai Disney Resort was open for the entire quarter, Walt Disney World Resort and Disneyland Paris were open for 12 weeks, Hong Kong Disneyland was open for 4 weeks and Disneyland Resort remained closed for seven. It should also be noted that during the weeks that the theme parks above were open, this was at reduced capacity.
Therefore it’s not surprising that parks would go up by $1.6 billion given that all parks around the world are open.
Projections continue to look favorable for the theme parks segments with the recent news regarding immunizations for those under the age of twelve. When coupled with the recent announcement that the US is once again opening its borders for international travel 2022 it bodes well for an increase in family travel.
Image Credit: Disney
Chapek also reported positive results regarding Disneyland’s Magic Key program which replaced the theme parks previous annual passholder program. The company boasted that the top two keys offered in the new program have proved popular with guests with the Dream tier selling out in the first two months.
For a closer look at the Magic Key system you can check out MickeyBlog article here.
The Walt Disney Company also reported that the uptick in theme park profits are also connected to in-park spending. Due to an increase in theme park attendance, profits in this area have gone up 30% in the last quarter.
This was also the quarter that Disney’s new paid-for FastPass system was introduced to the theme parks and we were definitely interested to hear how the reception was for the new service. According to Chapek, since the launch of Disney Genie, about 1/3 of guests are taking advantage of the Genie+ passes for an additional cost of $15 per person per day.
It should also be noted that Genie+ will be unveiled in Disneyland in the near future which should continue to have a positive impact on profits!
Other areas positively impacting theme park spending are mobile ordering which is a system whereby guests can order and pay for food using mobile phones as well as date-based pricing and strategically managed attendance through the Disney Park Pass reservations system.
This is just a quick overview of the topics discussed during this evenings earnings call. If you’d like to look at the report in it’s entirety you can find a release for the report here- Q4 Walt Disney Company 2021 Earnings Report
Readers are encouraged to keep following along with MickeyBlog for further Disney World news and updates. We’ll be coming to you LIVE from the theme parks throughout the holiday season.
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