Do any of you have any rumors that you've heard?
Feeding into The Spirit's narrative, how about this?
It wasn’t until I read The Walt Disney Company Q3 earnings call transcript that I realized what a nice snow job Iger & Rasulo had achieved with WDW attendance.
Initially CFO Jay Rasulo reported:
“During the quarter, attendance at our domestic parks was up 3%, with Walt Disney World and the Disneyland Resort each setting new Q3 attendance records”
Sounds great right? Record attendance, awesome right? At both WDW and DLR, right? But what exactly is does that mean?
When asked to expand on park trends, CEO Bob Iger let the cat out of the bag:
“Magic Kingdom in Florida had record numbers, as Jay mentioned, in the third quarter.”
Rasulo didn’t say “Magic Kingdom”, he said “Walt Disney World”. The Magic Kingdom is part of Walt Disney World so, in a sense, the Magic Kingdom setting an attendance record means Walt Disney World set some sort of attendance record but did Walt Disney World as a whole? It doesn’t seem so according to Iger who clearly identified the Magic Kingdom and the Magic Kingdom only. In fact, in his fuller answer to the question, Iger only spoke of the “Magic Kingdom”, never “Walt Disney World”.
Iger’s words align with observations. Guests reported tremendous crowds at MK last quarter but considerably less so at the other theme parks, especially during the latter half of the day.
And that’s WDW’s big problem. Attendance has become horribly lopsided with the other parks, particularly DHS, suffering badly as a result. MK is cannibalizing attendance from its own parks; not bringing new guests to WDW as a whole. WDW has the same problem today that DLR had 2 years ago.
Don’t forget that DLR attendance is up, way up. Carsland opened on June 15, 2012 and the quarter being reported ran from April to June. As it so happens, this was the last quarter with the “Carsland bump”. If combined domestic park attendance was up only 3% for the quarter and this was the last quarter with the “Carsland bump”, what exactly is going on at WDW?
Let’s not forget domestic park revenue was up only 7% for the quarter, and that’s with the “Carsland bump”, higher prices (e.g. MYW tickets up 7%, DDP up 12.5%), and the Flower & Garden Festival being transformed into another revenue-generating booze & food fest.
This is consistent with the premium now charged for Magic Kingdom tickets. If all four parks were performing well, why not have an across-the-board price increase?
It’s difficult to dispute that the Magic Kingdom is Orlando’s most popular park.
However, perhaps all is not well at the rest of WDW. Perhaps The Spirit’s latest news concerning DHS is supported by Iger’s & Rasulo’s attempt to paper over WDW’s institutional problems.
Perhaps Iger & Rasulo have a big mess on their hands in Orlando.