Disney Parks And Its Stock is Struggling – Does CEO Iger Cave Too Easily?
While Disney World is known as the happiest place on Earth, Disney investors and executives aren’t too happy right now. Between a decline in U.S. theme park attendance, an actors and writers’ strike, a battle with Florida Governor Ron DeSantis, and now a new fight with Elon Musk Disney’s seems to have a lot of distractions. Can they focus on business to get back on track or will they cave to public pressure again?
Fewer People are Going to Disney Parks
July 4th week saw something rare in Disney Parks – room to spread out. Whether you looked at the data or attended in person, park attendance was way down. How much? It was Disney’s lowest ticket sales for the July 4th weekend in decades.
Last year the parks brought Disney $32.3 billion in operating income. But with less of it the other business warts and missteps can’t be as covered with less of it. So while their international parks are doing well, their U.S. theme park admission and revenue is down.
You Know Something’s Up When Disney Puts Their Theme Park Tickets on Sale
Whenever Disney needs to drum up more ticket sales, they turn to its largest third-party ticket seller Undercover Tourist. Earlier this summer, they promoted an offer where you could buy adult admission tickets for the price of a child’s. Disney rarely puts tickets up for sale as they usually don’t need promotions to help fill the parks.
And recently, they launched a ticket and food package that can save families up to $1,000. But will it be enough in a world where people can now travel internationally again?
Has Their Part in The Culture Wars Finally Caught Up To Them?
In May, Disney park executives said their political and cultural battle with Florida Governor Ron DeSantis has yet to affect their business. However, fast forward two months later, and it looks like things may have changed.
Lawsuits aren’t cheap and neither are closed down projects, such as their $1 billion Lake Nona Florida office park.
Earlier this Year, They Closed Their Most Popular Ride Splash Mountain Due To Racist Ties
Sunday, January 22, 2023, marked the last day of the iconic Disney ride Splash Mountain. A fan-favorite ride for decades will be closed for two years and transformed into Tiana’s Bayou Adventure. This permanent closure comes after many decades of complaints of racist stereotypes and Jim Crow-era songs and imagery. But the backlash against this decision was rather large, too.
Earlier This Year Disney’s Stock Hit Its 10-Year Low
Even though the S&P 500 Index has jumped double digits, Disney’s stock hit its 10 year low this summer and it’s been hovering there for most of the summer.
This stock price decline is believed to have erased around $16 billion from the company’s market value. Now, there’s speculation that Iger is thinking about selling off parts of the company.
Will They Sell Off These Assets?
Bloomberg News reported on Monday October, 23, 2023 that Disney is close to a deal to sell a controlling stake of its India operations to Reliance Industries for approximately $10 billion. Will this yard sale of Disney+ Hotstar streaming service and Star India bring a lift to the Disney stock price that they’ve so desperately needed?
We’ve asked financial experts to weigh in on what’s dragging down Disney’s balance sheet and business.
Disney’s Business Is So Much More Than Its Theme Parks
“While theme park attendance is a significant aspect of Disney’s business, it is crucial to remember that the company’s overall financial performance is influenced by various factors. Changing consumer preferences and rising competition in the streaming industry are all important considerations,” explains Jorey Bernstein of Bernstein Investment Consultants.
Their Investment Into Streaming Has Had Mixed Results
“Disney’s expansion into the streaming market with Disney+ has been a significant strategic move. However, the increasingly competitive streaming landscape poses challenges,” Bernstein continues.
Not only have they invested heavily in Disney+, but they currently own 2/3 of Hulu with an option to buy the rest, which Iger has publicly stated he would love to do.
Lots of Disney+ Subscribers, Yet Lots of Losses
“Iger’s model of offering low prices and a bonanza of content has clearly resonated with consumers,” said a recent Barron’s article. So while they have almost 158 million Disney+ subscribers, it has come at a cost. It is expected to lose about $800 million in the third quarter.
They Spent a Lot on Streaming – Then Tons of Customers Left
Disney’s stock has taken a hit lately, mostly due to its Disney + platform, where they lost an estimated 4 million subscribers,” thinks David Berns, Financial Planner, Truadvice Wealth Management. “This is due to a recent price increases and lost ad revenue, not to mention the highly competitive space they are in.”
“Creating in-demand, high-quality content is expensive, and these platforms rely on ad revenue to help offset those costs. It is rumored that the next move is to push subscribers to the more expensive ad-free service of Disney +. They are hoping this will help increase revenues. “
Disney’s Big Movie Blockbusters Didn’t Perform as Expected in 2023
“Recent releases at theaters have had mixed results. This is most worrying to me personally as Disney’s business thrives and depends on capturing viewers early to become lifelong fans,” says Kyle Newell, Certified Financial Planner, Newell Wealth Management.
And with the writers and actors strike still on, 2023 releases will be delayed and all remaining projects aren’t moving forward to release.
With One Comment, Bob Iger Put The For Sale Sign Out
According to Bloomberg News, “Iger put roughly a third of the company up for sale earlier this year, declaring Disney’s linear TV assets noncore.” He was referencing TV networks ABC, FX, Freeform, and a strategic partner for ESPN.
Disney needs billions next year to complete the buyout of Comcast’s minority stake in streaming platform Hulu. Think this deal will come to fruition?
5 Experts Explain The Dreaded Disney Rash and How To Avoid This Disney Disaster
What happens when Americans visit a Disney theme park and take 20,000 steps or more daily in hot, humid weather? Many get the Disney rash.
If you’re planning on visiting Disney or any other theme park in a warm climate, here’s what you can do to prevent it and what items you should bring to treat it.
5 Experts Explain The Dreaded Disney Rash and How To Avoid This Disney Disaster
The 3 Best Days to Visit Walt Disney World Revealed
If you’re planning a trip to Disney, it’s essential to think about when you can avoid the crowds and the summer heat. Well, new research reveals the three best days to visit based on a crowds-to-weather score.
The 3 Best Days to Visit Walt Disney World Revealed
Disney’s No Longer Orlando’s Best Theme Park – Travelers Voted Discovery Cove Into the Top Spot
What if I told you about a place in Orlando near it all, but feels like you’ve been whisked to a tropical island? A day destination that’s nestled in between resorts and iconic theme parks but feels worlds away from the crowds and long lines of America’s vacation capital.
It’s not a Florida heat-induced mirage; it’s Discovery Cove Orlando. This unique, all-inclusive, all-day outing offers guests a one-of-a-kind opportunity to swim with dolphins, snorkel among thousands of tropical fish and rays, hand-feed exotic birds, and encounter playful otters—all in a surprisingly stunning tropical atmosphere just 12 miles from Orlando International Airport.
Disney’s No Longer Orlando’s Best Theme Park – Travelers Voted Discovery Cove Into the Top Spot
30 Reasons Families Prefer Legoland Florida to Disney World Theme Parks
Our family spent the last two Spring Breaks in Orlando, the most visited destination in America, but we had two very different experiences. In 2022, we had a typical Orlando family vacation visiting Disney theme parks. Then, in 2023, we went to non-Disney theme parks, including Legoland Florida, and it was a night-and-day experience.
After these two trips, our family prefers Legoland, Florida to Disney World. And it turns out we’re not the only ones. After interviewing 25 other families who feel the same, here’s why people are opting for days with Emmet, Lloyd, and Master Wu instead of Elsa, Luke, and Mickey Mouse.
30 Reasons Families Prefer Legoland Florida to Disney World Theme Parks
Here’s How I Saved $7,000 On Our Summer Family Vacation To Hawaii
With its unique aloha spirit, volcanic mountain terrain, tropical rainforests, national parks, fantastic food, and the best beaches in the world, it’s not a surprise that Hawaii is a top destination on people’s vacation wish lists.
If you think it’s out of reach for your family to visit the Aloha state, here’s how I saved $7,000 on our trip with just two booking strategies.
Here’s How I Saved $7,000 On Our Summer Family Vacation To Hawaii
This article produced by Planner at Heart.
