Disney’s earnings report that was released Wednesday showed a profit of $2.62 billion for its third quarter — a significant boost from its $460 million loss a year earlier — thanks in large part to its streaming business.
That’s the good news for the company.
The bad news? Disney’s theme parks earned less than expected in the third quarter. While Disney Experiences’ revenue increased by 2% in its third quarter, its segment operating income decreased by 3%. Disney Experiences includes its theme parks, cruises and consumer products.
Disney says the dip in income was “impacted by moderation of consumer demand,” which is expected to continue in the next few quarters, and rising costs due to inflation.
Not only does the slowing consumer demand for its domestic parks spell potential trouble for Disney, Business Insider called it “another warning signal for the U.S. economy.”
The “weaker-than-expected results” from Disney parks is “another sign that consumers are reining in spending as economic storm clouds gather,” business reporter Tom Carter writes for Business Insider.
It’s not all bad news, though.
Disney’s international parks seem to be doing better than its U.S. parks, with operating income growing by 2% to $435 million.
“While results at domestic parks decreased modestly in the quarter, attendance was comparable year over year and per capita spending was slightly up,” the earnings report reads.
A fifth Disney World park?
Disney’s earnings report comes a little over two months after the Florida Gov. Ron DeSantis-appointed members of the Central Florida Tourism Oversight District gave Disney initial approval to a 15-year development agreement.
Under the agreement, Disney would have approval to build another major theme park and two minor parks at the Disney World resort. The agreement would also allow the construction of 14,000 more hotel rooms and a 20% increase in retail and restaurant space, as the Deseret News previously reported.
Disney will commit to investing $8 billion into its resort in the next decade and $17 billion in the next two decades. As part of the agreement, $10 million would be allocated for affordable housing.