Disney Q4 Earnings: Domestic Parks See Growth, International Faces Hurdles

18 days ago in "The Walt Disney Company"

Posted: Thursday November 14, 2024 7:21am ET by WDWMAGIC Staff

Disney's latest fourth quarter earnings report released this morning reflects mixed results across its business segments. Overall, the company saw a 6% revenue boost in Q4, reaching $22.6 billion, and a 3% increase for the fiscal year, with annual revenues at $91.4 billion. Earnings per share for Q4 surged by 79%, driven largely by robust growth in domestic parks, streaming profits, and a strong film lineup. However, despite a 23% increase in total segment operating income for Q4, challenges in international parks and experiences—largely due to decreased attendance and rising costs—highlighted an uneven performance.

"This was a pivotal and successful year for The Walt Disney Company, and thanks to the significant progress we've made, we have emerged from a period of considerable challenges and disruption well positioned for growth and optimistic about our future," said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. "Our solid performance in the fiscal fourth quarter reflected the success of our strategic efforts to improve quality, innovation, efficiency, and value creation. In Q4 we saw one of the best quarters in the history of our film studio, improved profitability in our streaming businesses, a record-breaking 60 Emmy Awards for the company, the continued power of live sports, and the unveiling of an impressive collection of new projects coming to our Experiences segment. As a result of our strategies and our focus on managing our businesses for both the near- and long-term, we are differentiating ourselves from traditional competitors, leveraging the deepest and broadest set of entertainment assets in the industry to drive attractive returns and further advance our goals."

Financial Results for the Quarter and Full Year

Revenues increased 6% for Q4 to $22.6 billion from $21.2 billion in the prior-year quarter, and 3% for the year to $91.4 billion from $88.9 billion in the prior year.

Income before income taxes declined 6% to $0.9 billion in Q4 from $1.0 billion in the prior-year quarter and increased 59% for the year to $7.6 billion from $4.8 billion in the prior year.

The Experiences segment had record revenue and operating income for the full year. In Q4, Experiences revenue increased $0.1 billion, or 1%, and operating income of $1.7 billion was a decline of $0.1 billion, or 6% compared to the prior-year quarter. Domestic Parks & Experiences operating income increased in Q4, on comparable attendance to the prior-year quarter, driven by higher guest spending, partially offset by higher expenses and costs related to new guest offerings driven by Disney Cruise Line. International Parks & Experiences operating income declined in Q4.

Domestic Parks and Experiences Performance

Operating income for Disney's domestic parks and experiences increased, driven by:

  • Higher guest spending, with increases in per capita spending at both theme parks and on cruises.
  • Reduced sales of Disney Vacation Club units.
  • Increased costs, primarily from inflation, new guest offerings, technology upgrades, and operations support. These were slightly offset by lower depreciation costs compared to last year's quarter, following the closure of Star Wars: Galactic Starcruiser.

International Parks and Experiences

Operating income at Disney's international parks and experiences declined compared to the same quarter last year, due to:

  • Lower attendance, leading to reduced volume.
  • Higher costs from new guest offerings and increased depreciation.
  • A drop in per capita guest spending at theme parks, partly balanced by higher per-room spending at resorts.

We expect to hear more from Disney CEO Bob Iger during an earnings call later this morning.

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JoeCamel16 days ago

Yeah, what happens the second half of next year? I wonder.....

NotCalledBob16 days ago

Good news things are looking up on the bookings front for the second half of next year. Not for me though, because I'm booked to go the second half of next year... The FT suggests that there is growing impatience over the CEO issue. https://www.ft.com/content/dc095b16-a83a-485c-9657-128af30789cd

Sir_Cliff16 days ago

Yes, I would think signs like Disney experiencing attendance as soft as Uni Orlando this year or bookings for next year appearing unusually soft might ring some alarm bells about fans cancelling or delaying trips due to excitement for Epic Universe. The early signs, though, are that managing the attendance shifts among the different Orlando parks is more of a concern for Uni than Disney.

MisterPenguin16 days ago

https://deadline.com/2024/11/disney-stock-rises-streaming-wall-street-1236177953/

MisterPenguin16 days ago

I hear this every year. By now, everything should be shuttered, no?

HauntedPirate16 days ago

Stop stealing their tagline! "Epic Universe - Prepare to be whelmed!"

Kamikaze16 days ago

Epic Universe is going to be perfectly whelming. It won't make a major difference in WDW attendance.

BrianLo16 days ago

Based on what current evidence? Maybe the rabid fandom has been wrong all this time? Disney is already saying their summer bookings look stronger and they expect to be up for attendance in the back half of the year post-Epic. Universal seems currently far more impacted and WDW bookings are actually projecting to be up once Epic opens. Comcast are the ones that need to justify that the expense paid off. Based on possible inflated projections, I'm far more worried for Comcast being caught off guard than Disney at this point. Certainly the fandom that thought Universal attendance would instantly increase 150% don't know their history very well; it's going to be a rough ride if internally Comcast was expecting more instant returns.

Greg from Philly16 days ago

Disney and Disney Management are really clueless. There are insiders that are saying they are terrified of the opening of Epic Universe...how can they not be?? If they arent, they really are stupid

IanDLBZF16 days ago

Where did you hear this?

Sir_Cliff16 days ago

I feel like for as long as I have been online I have been reading claims about how Disney is manipulating their numbers in various ways from closing large sections of their resorts to pretend they are fuller than they really are to simply lying in their quarterly reports. Accepting all of that, I am surprised the whole house of cards hasn't collapsed yet, leaving bankruptcies, prison sentences, and a baron wasteland where WDW once stood in its wake.

Chi8416 days ago

Maybe someone could re-share the information on which buildings are shuttered? We just returned from a stay at SSR and it was very busy.

BrianLo16 days ago

I mean it doesn't really matter at this point and they probably do have the sections closed you think they do. But the SEC filings include the closures and the occupancy rates ultimately reflect those assumed closures. We're 5% below 2019, which jives with likely closures, but nor is it a historical recessionary bottoming or seemingly worsening.

peter1143516 days ago

Oh yeah like how they have building 4 closed at POFQ? Sorry I don’t share your misunderstanding of operations.