NEWS: Disney Theme Parks Division Reports Profitability For the First Time Since the Start of the Pandemic

A lot of things have changed over the past year and even just within the past few weeks and months for the Walt Disney Company. We’ve been keeping track of how some of those changes have impacted Disney’s financial standing by listening to Disney’s shareholder meetings and earnings calls.

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Today is a big day for investors, as Disney is holding its Quarterly Earnings Call, covering Disney’s third quarter financials for fiscal year 2021. Ahead of that call, Disney has released its Q3 financial report. Now, we’re breaking down everything you need to know about how the Disney Company is doing financially at the moment.

Overall

From an overall perspective, the third quarter for the 2021 has proven to be positive for the Disney Company. According to a quote from Bob Chapek, Disney’s Chief Executive Officer, included in the Q3 financial report, Disney “ended the third quarter in a strong position, and are pleased with the Company’s trajectory as we grow our businesses amidst the ongoing challenges of the pandemic.”

According to Chapek, Disney is continuing to “introduce exciting new experiences at our parks and resorts worldwide, along with new guest-centric services, and [their] direct-to-consumer business is performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of the quarter, and a host of new content coming to the platforms.”

©The Walt Disney Company

Here’s an overview of the third quarter results for the fiscal year 2021.

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Overall, excluding certain items, the diluted earnings per share for this quarter increased to $0.80 compared to the $0.08 value it was at during the prior-year quarter.

Let’s break down some of the big items from the report.

Parks, Experiences and Products

When it comes to the theme parks, Disney’s third quarter report notes that since early 2020 and into 2021, COVID-19 and measures to prevent its spread have impacted the company’s segments in various ways. But, Disney notes that its theme parks and resorts resumed operations (generally at reduced capacity) between May 2020 and June 2021. Disney’s cruise ships have also returned to sailing.

Magic Kingdom

According to Disney, they will continue to incur costs to address government regulations and implement safety measures. Disney’s report shares that they expect these costs to be approximately $1 billion for fiscal 2021.

Cinderella Castle

Once again, Disney has noted that the most significant impact on its operating income has been at Parks, Experiences, and Products. According to Disney’s report, “segment operating income for Disney Parks, Experiences and Products segment in the current nine-month period declined $1.6 billion compared to the prior-year nine-month period due to COVID-19.”

But, when this last quarter is compared to the same quarter last year, things at parks, experiences, and products actually did better in fiscal year 2021. You can see that the revenue for parks, experiences, and products was $4.3 billion at the end of this quarter, compared to the about $1.1 billion from the prior-year quarter. Disney notes that “Segment operating results increased $2.2 billion to income of $356 million.” This is compared to a loss of about $1.87 billion during the same quarter last year.

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As CNBC notes, for the first time since the pandemic began, Disney’s theme parks division has actually returned to profitability.

Media and Entertainment Distribution

In terms of Media and Entertainment Distribution, Disney notes that “COVID-19 had a negative impact at [their] Disney Media and Entertainment Distribution segment compared to the prior-year quarter and nine-month period as higher advertising revenue from the return of live sports programming was more than offset by higher sports programming costs.”

Here’s a look at some of the revenue and operating results for the Media and Entertainment Distribution segment.

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When it comes to Disney’s direct-to-consumer services, Disney notes that its revenues increased “57% to $4.3 billion and operating loss decreased from $0.6 billion to $0.3 billion.”

When it comes to Disney+ specifically, Disney noted that the “higher loss at Disney+ was due to higher programming and production, marketing and technology costs, partially offset by an increase in subscription revenue and Premier Access revenue for Cruella in the current quarter.”

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Here’s a look at the current number of Disney+, ESPN+, and Hulu subscribers. As of the latest report, Disney+ has a total of 116 million subscribers.

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According to CNBC, this is actually higher than what some analysts expected Disney to report.

We’ll continue to share more updates about information released in the earnings call so stay tuned for more news.

Click here to learn more about last quarter’s results!

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Are you planning to visit Disney’s theme parks soon? Let us know in the comments.

The post NEWS: Disney Theme Parks Division Reports Profitability For the First Time Since the Start of the Pandemic first appeared on the disney food blog.

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