ORLANDO, Fla. – The Walt Disney Company on Tuesday released its third-quarter earnings results, revealing just how much of an impact the coronavirus pandemic has had on its businesses, especially the theme parks.
What You Need To Know
- Disney releases 3rd quarter earnings results
- Theme parks segment took $3.5 billion hit
- Disney had to close its theme parks because of the pandemic
Disney’s Parks, Experiences and Products segment, which includes the theme parks and Disney Cruise Line, reported $983 million in revenue during the quarter, an 85 percent decline from the $6.57 billion it generated in the same period in 2019.
In its earnings report, Disney said that the coronavirus-related shutdown of its parks had an estimated $3.5 billion impact on the segment's operating income.
Disney’s U.S. parks — Disneyland in California and Disney World in Florida — were closed for the entire quarter, which runs April-June. Shanghai Disneyland, which reopened in May, and Hong Kong Disneyland, which reopened in June, were the only Disney parks operating before the quarter ended, although Hong Kong Disneyland closed a month after reopening due to rising cases in the region.
Disney World's theme parks reopened with capacity limits and other safety and health measures in mid-July. Disneyland remains closed, and no reopening date has been announced.
While the reopening of Disney World’s theme parks has been positive for the company, the financial results have been lower than expected due to the rise of COVID-19 cases in Florida, Disney CFO Christine McCarthy said in an investors call after results were released.
Chapek also noted in the call that the rise cases had caused “trepidation” in travelers and led to a “higher than expected” number of cancellations.
About 50 percent of Disney World’s attendance currently comes from locals/in-state visitors, with the rest made up of travelers who come “from a distance,” Chapek said.
Disney's latest earnings further highlight just how hard the pandemic has hit the theme park industry.
Last week, Universal Orlando parent company Comcast revealed revenue for its theme park division fell 94 percent in the second-quarter due to coronavirus closures. The news was followed by another round of layoffs at the resort.
SeaWorld, which hasn’t released its final earnings results yet, expects revenue to decrease to $18 million in the second quarter compared to $406 million in revenue from the same period last year.