News Dismal Q3 Earnings

[LSLS]

Also, it is super weird that everyone is making judgements on the success of SWGE after one partial quarter. People were literally doing the same thing when Pandora opened and didn't instantly have material impact to the attendance. After a year of operation we really saw those numbers grow. Normal people don't plan expensive Disney Vacations with barely 6 months notice to the opening of a land with no guarantees that the whole land will be open on time. That is Fanboi bubble mentality only. Most people remember that launches are not great times to visit theme parks. (Hagrid's, Volcano Bay, ROTR not opening are all recent examples that will drive people away from not booking day 1, month 1 trips for a new attraction)

Maybe I'm remembering wrong, but I thought there were lines (and people turned away) from Pandora just to get into the land for a long time after opening. I wouldn't completely judge the land yet, but you have to think there is real concern. I mean, think of all the jokes everyone had about the artist renderings where there were just a few people wandering through the land. Even the biggest "Haters" thought this land was a slam dunk. Now sure, you can argue "It's missing a huge ride still" and "Hollywood Studios will have a bigger crowd," but you can't possibly think the idea behind opening the land at DLR with one ride operating was "Sure, it will be sparse crowds, but it will increase later." I wouldn't say this is a complete failure yet, but I would say that I think the chances of it are WAY more likely than they were a year ago.

I'd also like to see the numbers on if people plan trips for openings as opposed to waiting. What did DLR hotels look like that first week SWGE? How has WDW changed for that first week since announcing of SWGE? Heck, how did Universal change with their major opening ride announcements? I would bet most people really want to be the FIRST to experience something, not wait for the bugs (that most probably figure were worked out well in advance of the opening announcement) to be worked out. I can't imagine a park announces an opening date and thinks that 4 months after that date is when they will see a big spike in attendance. But again, I'm far from a parks/business guy, so maybe I'm just way off on it.

 

[MisterPenguin]

It's not simply about third quarter results. Anyone paying attention knows that attendance has been and continues to be down. If you're only looking at Q3 in a preterit sense, without noticing the present, you're not as savvy as the market. Personally, I think you're just employing a cynical strategy to win a forum argument rather than to reflect how the stock market actually works.

There have been other quarters where attendance was lower than the previous year's quarter and that obviously had nothing to do with SWL or the movies based on that IP.

Last September, WDW was panicking over a slump that month and they recovered with increased attendance for the year, in fact, crowds came back that next month. Three years ago the dead zone of Fall started to have record breaking crowds. Things change. Disney pushes people away from the Summer with higher prices and scare stories of mobs and more rigorous black outs... and it works. Quelle surprise!

I've posted several things here showing that stock market skitterishness is an awful metric to follow to judge the health of a company. But Wall Street and all the links you keep posting, are beholden to the daily ticks of the stock market, which, to do so, is sheer financial stupidity. If you think Disney fandom is an echo chamber... welcome to the world of Wall Street analysts (the overwhelming majority of whom were bullish on the market right up to and during the beginning of the Great Recession). They talk themselves into thinking a few sharp points matter and all they're doing is fueling day-trading speculators who are not into the market for investing long term into solid gains, but playing against one another in the speculative game.

In short, your links don't impress me and don't inform me. Motley Fool was down on Disney for the longest time for no good reason. I read the financial reports. Disney's doing incredibly well.

And anyone looking at 'crowds' during 'a season' and extrapolating from there aren't very smart, whether they be stock market analysts, forum fanboys, disgruntled ex-CMs, or even Disney execs that may be panicking right now.

Of course DLR made an advertising mistake in overselling crowd managing.

However, no one could possibly know at this point if the land itself will be rejected by guests because the land isn't finished.

What we have here is Disney spinning the idea that the land is "open early," when it's not really finished to actually open early. It's really a preview. And we have fans buying that nonsense that this is anything more than a preview/soft opening.

 

[GoofGoof]

So is it to soon to say that maybe, just maybe there are not as many star wars geeks out there as the merchandise folks thought.
Or those who are super geeks and work at the compay, in those design and development roles, might need to start paying attention to other things and perhaps not think that just cause they like it, EVERYONE will. I dunno, I mean I know a few 5 year olds.. they couldn't care less about GE.. but you ask them about Blippi or Ryan's Toy Review.. they know all about that.

...to judge a partially open land in a locals theme park where all of the locals have been blacked out. Nah, not too soon for a knee jerk overreaction.

It must be that small group of Star Wars geeks who also bought almost $5 billion worth of movie tickets since the mouse took over. Not popular at all.

 

[Sirwalterraleigh]

...to judge a partially open land in a locals theme park where all of the locals have been blacked out. Nah, not too soon for a knee jerk overreaction.

It must be that small group of Star Wars geeks who also bought almost $5 billion worth of movie tickets since the mouse took over. Not popular at all.

And yet...they haven’t shown?

Can we seriously debate that not having mobs and lines for ANY new Disney land in an environment where people are starved for just that thing is not patently silly?

Let alone this “blockbuster” worldwide franchise?

Something is up...we don’t know for sure what all the factors are...

But on that $5 billion?

Yeah...2.0 in 2015....1.1 in 16...1.2 in 17....0.4 in 18

Now if only we could plot somekind of pattern there??

 

[Indy_UK]

Spending was up despite crowds being down. This is not a failure. It's exactly what Disney wanted.

 

[MisterPenguin]

Spending was up despite crowds being down. This is not a failure. It's exactly what Disney wanted.

Normally yes, when there's overcrowding. And when the extra spending makes up for decreased attendance, like it has in past quarter.

But not when so much capacity is left unused. And not when so many fewer people outweighed the extra spending and total revenue went down.

Mind you, DL still made tons of profit. But it could have been much more if there were busier, which they could have easily been if handled differently.

 

[WDW Pro]

I know how the stock market works and I also understand that this discussion is about more than just the third quarter. That said many(most) or the factors that affected the third quarter are still impacting the present. But none of that is relevant to the post that started this discussion which you claimed was false, but was clearly fact. I wasn’t implying anything more about current or future performance. Just explaining why only a few weeks were mentioned as that was all that mattered in this particular report.

Well, just so you're aware, the attendance situation got worse, not better.

 

[monothingie]

Last September, WDW was panicking over a slump that month and they recovered with increased attendance for the year, in fact, crowds came back that next month. Three years ago the dead zone of Fall started to have record breaking crowds. Things change. Disney pushes people away from the Summer with higher prices and scare stories of mobs and more rigorous black outs... and it works. Quelle surprise!

Disney was proactive with extremely generous hotel and package discounts last year which contributed to a turnaround during this period. The same happened for summer 2019 where they also have been extremely generous with discounts.

The begrudgingly released discounts for fall 2019 are much more limited in terms of inventory and scope. Travel professionals still are saying that they didn’t go far enough to help soft bookings as there is still a lot of availability at rack rate for Disney hotels.

 

[mikejs78]

I agree the sky isn’t falling, but aren’t the blackout dates for 2019 only marginally more restrictive than the 2018 dates?

I just think hi expectations and the way it was played in the media coupled with price hikes that turned people off.

They are much more restrictive -

• They blocked out the Deluxe level for the entire summer. Last year, only the Select tiers were blacked out for the summer and the Deluxe tier had access to summer weekdays.
• They raised the price of the signature plan by 15%.

It's not simply about third quarter results. Anyone paying attention knows that attendance has been and continues to be down. If you're only looking at Q3 in a preterit sense, without noticing the present, you're not as savvy as the market. Personally, I think you're just employing a cynical strategy to win a forum argument rather than to reflect how the stock market actually works.

You have repeatedly shown your lack of understanding of how the stock market works and what the Disney Q3 results actually said in order to fit your own narrative.

There have been other quarters where attendance was lower than the previous year's quarter and that obviously had nothing to do with SWL or the movies based on that IP.

Last September, WDW was panicking over a slump that month and they recovered with increased attendance for the year, in fact, crowds came back that next month. Three years ago the dead zone of Fall started to have record breaking crowds. Things change. Disney pushes people away from the Summer with higher prices and scare stories of mobs and more rigorous black outs... and it works. Quelle surprise!

I've posted several things here showing that stock market skitterishness is an awful metric to follow to judge the health of a company. But Wall Street and all the links you keep posting, are beholden to the daily ticks of the stock market, which, to do so, is sheer financial stupidity. If you think Disney fandom is an echo chamber... welcome to the world of Wall Street analysts (the overwhelming majority of whom were bullish on the market right up to and during the beginning of the Great Recession). They talk themselves into thinking a few sharp points matter and all they're doing is fueling day-trading speculators who are not into the market for investing long term into solid gains, but playing against one another in the speculative game.

In short, your links don't impress me and don't inform me. Motley Fool was down on Disney for the longest time for no good reason. I read the financial reports. Disney's doing incredibly well.

And anyone looking at 'crowds' during 'a season' and extrapolating from there aren't very smart, whether they be stock market analysts, forum fanboys, disgruntled ex-CMs, or even Disney execs that may be panicking right now.

Of course DLR made an advertising mistake in overselling crowd managing.

However, no one could possibly know at this point if the land itself will be rejected by guests because the land isn't finished.

What we have here is Disney spinning the idea that the land is "open early," when it's not really finished to actually open early. It's really a preview. And we have fans buying that nonsense that this is anything more than a preview/soft opening.

@MisterPenguin is so on-point here that this post should be pinned, framed, and re-posted whenever the topic of Disney and Wall Street come up. I also have read the financial report, and most of the stuff in some of the posted articles, as well as the claims made by others here, are not supported by the report. Disney is doing incredibly well, and growing at a rapid pace. By any sane measure of business success, they are killing it. But the echo chamber of analysts said they should be growing even more, and since they didn't hit that target, their stock price went down.

There was another company I was following recently that isn't doing so well, The analysts predicted a substantial loss for the quarter. But when the results came out, they were flat, not as the analysts expected because they had done some additional cost-cutting measures, but had no revenue growth. What happened? Their stock price went up $10 because they "beat expectations". So you have a company that is doing poorly, but their stock price rises because they didn't do as poorly as everyone thought, and you have a Disney that increased revenue by 33% over the same time last year, but suddenly their stock drops because they didn't "meet expectations". It's insanity. Wall Street is broken, and anyone who puts too much stock in the wild swings of the quarter-to-quarter earning cycles is foolish. The good news is that things tend to even out over time, and so long-term growth trends tend to reflect the health of a company much better. And on that metric:

• Up almost 24% on the year - they began the year at $108.97 and are now, even after this supposed disasterous Q3 results, up to 134.86.
• 55% increase in the last 5 years - up from $86.85
• Up 389% from when Bob Iger became CEO - up from $27.59
• Went from being a $30B company to a $60B company during Iger's tenure

So yeah, Disney is doing horribly.

 

[mikejs78]

Well, just so you're aware, the attendance situation got worse, not better.

Really? I've heard that attendance in July was up over June...

 

[mikejs78]

But on that $5 billion?

Yeah...2.0 in 2015....1.1 in 16...1.2 in 17....0.4 in 18

Now if only we could plot somekind of pattern there??

Oh please. Nothing was ever going to do as well as TFA - it was an event fill a la Avengers, an outlier. Your numbers are off on the next two films. 1.0 for rogue one, 1.3 for TLJ. And Solo had a whole host of problems that caused it to do far less. There isn't a pattern here to discern because the sample size is too small..

 

[monothingie]

Really? I've heard that attendance in July was up over June...

Post July 4th, it has been mobbed. @lentesta tracks the stats and can probably elaborate more authoritatively.
Carrot and Stick approach of discounts.

 

[mikejs78]

Post July 4th, it has been mobbed. @lentesta tracks the stats and can probably elaborate more authoritatively.
Carrot and Stick approach of discounts.

That was my understanding as well.

 

[monothingie]

That was my understanding as well.

Which does not bode well for the argument that guests are holding off for SWGE/ROTR/RAT/Rail Road or anything else to open. It does show that guests are holding off for discounts and won't travel unless there are discounts.

 

[mikejs78]

Which does not bode well for the argument that guests are holding off for SWGE/ROTR/RAT/Rail Road or anything else to open. It does show that guests are holding off for discounts and won't travel unless there are discounts.

I don't know that it's an either/or scenario. Discounts definately play into it, but I think the delay factor does as well. I have heard from some travel agent friends that late 2019 is softer than usual, but 2020 so far is like nothing they've ever seen (specific to WDW, not DLR). So it's possible people are waiting for more to be open - Rise, Rat, Mickey, etc... Not sure if that's true on a wider scale or just their own experience though...

 

[monothingie]

I don't know that it's an either/or scenario. Discounts definately play into it, but I think the delay factor does as well. I have heard from some travel agent friends that late 2019 is softer than usual, but 2020 so far is like nothing they've ever seen (specific to WDW, not DLR). So it's possible people are waiting for more to be open - Rise, Rat, Mickey, etc... Not sure if that's true on a wider scale or just their own experience though...

I've gotten word from a couple of sources that those looking to go in Summer 2020 have booked early and its returning to "normal summer levels", but the rest of the year especially parts of Winter and late Spring are still slow.

 

[Ravenclaw78]

Not at any time, only when it was funny.

That only applies to ToonTown.

 

[Indy_UK]

Normally yes, when there's overcrowding. And when the extra spending makes up for decreased attendance, like it has in past quarter.

But not when so much capacity is left unused. And not when so many fewer people outweighed the extra spending and total revenue went down.

Mind you, DL still made tons of profit. But it could have been much more if there were busier, which they could have easily been if handled differently.

With our business heads on, your absoluetly right but as fans who pay massive amounts to go to visit these parks, we want the lower attendance

 

[Kingoglow]

While I am not a fan of the current SW Trilogy, I can't help but think that WDW SEGE can be nothing less than a success. It will succeed because they have family trapped in the buggle year round. Most families are visiting each park once; Disney even sells their special ticket discounts to promote this behavior.

Just like these families were planning their entire day at DHS before TSL opened (While we were arguing that it was a half day park), families will continue this pattern. Each park at least once. Try to explore SWGE because the internet tells them to. Buy Blue Milk because Instagramers tell them to. Buy their kid a lightsaber because the mom that lives down the street did for her kid. It is the same behavior pattern that we see across property.

WDW SWGE can be nothing but a success with a trapped audience, biting on all of the lures that Disney lays out for them. It won't matter how the ST is viewed by the public. People will go because they are in Florida, in WDW and in DHS on at least one day of their trip. You will not see the ghost town that we have seen at the West coast property.

 

[Magenta Panther]

Just thought I'd leave this here:

Bloomberg - Are you a robot?

www.bloomberg.com

BTW, ignore the name of that link. Bloomberg's being silly.