Disney Parks Pandemic Closures Result in $3.5 Billion Loss

BUSINESS

2:35 PM PDT 8/4/2020 by Ryan Parker

A lion's share of the loss came from the closure of the domestic parks and Disneyland Paris.

The Walt Disney Co. on Tuesday revealed that the financial impact due to its theme parks around the globe being shuttered amid the novel coronavirus pandemic resulted in a fiscal quarter loss of $3.5 billion.

Most of the theme parks closed in mid-March, including the two domestic parks. Walt Disney World in Florida reopened last month. Disneyland in Southern California remains closed save for the Downtown Disney shopping and dining district. It is unclear when the theme park and hotels will reopen. 

"Parks, Experiences and Products revenues for the quarter decreased 85 percent to $1.0 billion, and segment operating results decreased $3.7 billion to a loss of $2.0 billion," according to the Tuesday fiscal report. "Lower operating results for the quarter were due to decreases at both the domestic and international parks and experiences businesses and to a lesser extent, at our merchandise licensing and retail businesses." 

A lion's share of the loss came from the closure of the domestic parks and Disneyland Paris which were closed for the entire third quarter where the China parks were reopened for a portion of that time, according to the officials on the afternoon earnings call. 

Disney CFO Christine McCarthy noted that the surge in Florida virus cases hurt airline travel, which did impact the company's initial park projections. Nonetheless, the company is seeing a "positive net contribution" from Disney World being reopened at reduced capacity, McCarthy said. 

Disney CEO Bob Chapek again noted that a park location would not be in operation if it would lose money. And he noted the company was confident that the number of park visitors would continue to increase as people regained confidence. 

Chapek did not address when the rest of Disneyland may reopen, as California has yet to offer guidelines with the surge in virus cases in the state. 


Read The Rest at Hollywood Reporter- (opens a new tab)





Pages

Archive