Quarter 2 earnings report - Walt Disney World attendance down, revenue and operating income up

May 10, 2016 in "The Walt Disney Company"

Posted: Tuesday May 10, 2016 6:16pm EDT by WDWMAGIC Staff

The Walt Disney Company today reported quarterly earnings of $2.1 billion for its second fiscal quarter ended April 2, 2016, an increase of $35 million over the prior-year quarter.

Read the full report.

Parks and Resorts revenue increased to $3.9 billion, up 4%, while operating income increased by 10% to $624 million. A decrease in attendance at Walt Disney World was noted, but offset by increased guest spending.

“We’re very pleased with our overall results in Q2, which marks our 11th consecutive quarter of double-digit growth in adjusted EPS,” said Robert A. Iger, chairman and chief executive officer, The Walt Disney Company. “Our Studio’s unprecedented winning streak at the box office underscores the incredible appeal of our branded content, which we continue to leverage across the entire company to drive significant value. Looking forward, we are thrilled with the Studio’s slate and tremendously excited about the June 16th grand opening of the spectacular Shanghai Disney Resort.”

The part of the report concerning the theme parks is included below.

Parks and Resorts segment

Parks and Resorts revenues for the quarter increased 4% to $3.9 billion and segment operating income increased 10% to $624 million. Operating income growth for the quarter was due to an increase at our domestic operations, partially offset by a decrease at our international operations. The current quarter reflected an offsetting impact from a shift in the timing of the New Year’s and Easter holidays relative to our fiscal periods. The current quarter was adversely impacted by the absence of several days of the New Year’s holiday, which occurred in the second quarter of the prior year. This impact was essentially offset by the benefit of the two-week Easter holiday, which occurred in the second quarter of the current year compared to the third quarter of the prior year.

Higher operating income at our domestic operations was due to guest spending growth, partially offset by higher costs. The increase in guest spending was due to higher average ticket prices at our theme parks and cruise line, increased food, beverage and merchandise spending and higher average hotel room rates. Cost increases were due to labor and other cost inflation and higher depreciation associated with new attractions. Attendance at our domestic theme parks was relatively flat, as an increase at Disneyland Resort was offset by a modest decrease at Walt Disney World Resort.

Lower operating income at our international operations was due to higher pre-opening expenses at Shanghai Disney Resort, increased operating costs at Disneyland Paris and lower volume at Hong Kong Disneyland Resort, partially offset by higher guest spending at Disneyland Paris.

Discuss on the Forums
View all comments →

Progress.CityMay 16, 2016

He is investing in the parks but on big projects only. Gone are the days of a new E-ticket every three years.

betty roseMay 16, 2016

I'm hope Iger's stock goes bust, like the way he is busting the parks. I'm never going twice or three times a year. Now, it's one with DVC and eating elsewhere. We are opting out of Disney for three days this year. More the next. We go in only to spend time with the family.

ford91exploderMay 15, 2016

He already is but its stock that he's buying not investing in the business as Eisner did

betty roseMay 15, 2016

I hope you enjoy it as much as I do.

Cesar R MMay 15, 2016

Same here, We wanted to either go to WDW again or take A disney Cruise, but their price hikes.. yikes! also going on the Oasis!!

Cesar R MMay 15, 2016

Are they counting DVC units as "occupancy" as well? Speaking of DVC.. I wonder.. If DVC stops selling or Disney stops building them.. will the WDW finances get a huge hit?

Cesar R MMay 15, 2016

I cant wait to see Peter quill scream "HEY HO..E!" while Rocket Blasts some creatures and groot takes a nap in the new Seven Guardians Mine Train. :hilarious:

Cesar R MMay 15, 2016

not to mention is way less worth now.. I mean.. smaller plates/less food, cheaper condiments, higher price...

Cesar R MMay 15, 2016

You bet we will see a big hike once Star Wars opens...

Cesar R MMay 15, 2016

Theres no dynamic pricing at all in that thing. Its just "charge more or charge the usual". I have no idea how they labeled that "dynamic". Dynamic means both ways, not only up.

Cesar R MMay 15, 2016

fat chance. I wonder if they will actually follow EA's treyarch technique. No dedicated servers No Map makers map editors, nothing All will be Paid DLC with either by DLC or "season pass". Forced obsolescence every year (in some case extreme, by shutting down the main matchmaking servers). Paid Extras, limited characters/slots/gear. You pay to unlock slots that you can later buy stuff that needs unlocking. All with real money.

Cesar R MMay 15, 2016

so, almost all the increments of revenue were thanks to higher prices and not natural growth? better at disneyland and everyone leaving DHS to die...

Progress.CityMay 14, 2016

Let's hope that he does what Eisner did before he left - spend like a dunked captain!

Progress.CityMay 14, 2016

Maybe the fact that DLR emphasis both show quality and quantity, versus WDW's not giving a blank about either has something to do with it ?????