How Disney parks are bucking a travel slowdown

Despite a slump in international travel to the U.S., Disney parks have bucked the trend, reporting record quarterly revenue. The experiences division, which encompasses theme parks, cruise line, resorts, and consumer products, generated nearly $10 billion in revenue for the fiscal third quarter, marking a 10% increase from the same period a year prior and setting a new quarterly record.

The division has consistently posted record revenues for six consecutive quarters. Operating income reached over $3 billion, a 20% increase from the same period last year. Disney CEO Josh D'Amaro noted during the earnings call that the company is performing significantly better than its competition, delivering strong volume and per capita spending results, even amidst macroeconomic uncertainty.

Rival Comcast reported a decline in theme park attendance, particularly in Orlando, Florida, as international travel to the U.S. dropped by 6% last year due to travel bans, visa fees, and safety concerns. However, Disney's domestic park attendance rose by 3%, and guest spending increased by 4%, according to CFO Hugh Johnston. The company credited its Cool Kids Summer promotion, which included kid-focused character meet-and-greets, dance parties, and free water park admission for hotel guests, for the strong attendance.

Additionally, Disney refreshed and reimagined popular park attractions, and leveraged targeted marketing and discounting campaigns to engage young families and residents, creating urgency to visit the theme parks during the quarter. The addition of two new cruise ships to Disney's fleet also contributed to revenue growth, with stateroom capacity increasing by around 50%, pushing revenue from resorts and vacations up 17% to $2.77 billion for the fiscal third quarter.