News Disney plans to accelerate Parks investment to $60 billion over 10 years

[lazyboy97o]

That's a fair question. I think the actual point is that they don't truly intend to spend this unless we see economic rebound. I would argue this is a way to attempt to lure analysts, address Universal questions and yet leave a MASSIVE open door to saying "economic realities have changed" in the coming few years and slash that actual spend. It's not that it is misapplied - it's that the number was manufactured from the beginning.

What you are describing is a crime. You’re telling us that a week into a new job and a guy agreed to join in a criminal conspiracy. One based on the premise of finance types not even glancing at economic data.

 

[Sirwalterraleigh]

What you are describing is a crime. You’re telling us that a week into a new job and a guy agreed to join in a criminal conspiracy. One based on the premise of finance types not even glancing at economic data.

That is absolutely not “a crime”…absolutely not. No plans are “binding” because a short man says it to make himself look good. “Plans change” is used on Wall Street every minute of every day.

 

[Epcot82Guy]

What you are describing is a crime. You’re telling us that a week into a new job and a guy agreed to join in a criminal conspiracy. One based on the premise of finance types not even glancing at economic data.

I understand what you are trying to say, but there are certainly ways to do this without that being true. They can have full intention of spending that money, likely with flagged projects. They also can then make the decision to change that spending if economic conditions worsen. I'm not saying they will and have attempted to misrepresent. I'm saying this suggests they are hedging bets behind the scenes. Of course misrepresentation in public guidance statements is a violation of SEC rules as well as regulations (if not getting to criminal level if done with proper levels of intent and/or where the veil can be pierced). I'm not saying it's at that level. I'm saying: (1) this does not instill great confidence they have concrete plans, (2) they have not closed the door to a pivot if economics change in the coming 12-24-36 months, (3) they are not viewing EU as a credible threat, and (4) they have the convenience of any inflation that continues to help whittle the actual spend down.

Again, this isn't me saying they are abjectly lying or attempting to mislead. I'm saying this is a high level projection targeted at analysts and not something where I'm going to get my hopes up. They have left a lot of outs or ways to be truthful without commitment. Do they see the Parks as the driving force? Absolutely - and that is accurate. Will that translate into more meaningful spend than we've seen? My jury is reserved there.

 

[Sirwalterraleigh]

I understand what you are trying to say, but there are certainly ways to do this without that being true. They can have full intention of spending that money, likely with flagged projects. They also can then make the decision to change that spending if economic conditions worsen. I'm not saying they will and have attempted to misrepresent. I'm saying this suggests they are hedging bets behind the scenes. Of course misrepresentation in public guidance statements is a violation of SEC rules as well as regulations (if not getting to criminal level if done with proper levels of intent and/or where the veil can be pierced). I'm not saying it's at that level. I'm saying: (1) this does not instill great confidence they have concrete plans, (2) they have not closed the door to a pivot if economics change in the coming 12-24-36 months, (3) they are not viewing EU as a credible threat, and (4) they have the convenience of any inflation that continues to help whittle the actual spend down.

Again, this isn't me saying they are abjectly lying or attempting to mislead. I'm saying this is a high level projection targeted at analysts and not something where I'm going to get my hopes up. They have left a lot of outs or ways to be truthful without commitment. Do they see the Parks as the driving force? Absolutely - and that is accurate. Will that translate into more meaningful spend than we've seen? My jury is reserved there.

“Cancelling” investment is in no way an SEC crime…
It’s silly to suggest it.

Some people might need to get out of Orlando more often…

 

[lazyboy97o]

I understand what you are trying to say, but there are certainly ways to do this without that being true. They can have full intention of spending that money, likely with flagged projects. They also can then make the decision to change that spending if economic conditions worsen. I'm not saying they will and have attempted to misrepresent. I'm saying this suggests they are hedging bets behind the scenes. Of course misrepresentation in public guidance statements is a violation of SEC rules as well as regulations (if not getting to criminal level if done with proper levels of intent and/or where the veil can be pierced). I'm not saying it's at that level. I'm saying: (1) this does not instill great confidence they have concrete plans, (2) they have not closed the door to a pivot if economics change in the coming 12-24-36 months, (3) they are not viewing EU as a credible threat, and (4) they have the convenience of any inflation that continues to help whittle the actual spend down.

Again, this isn't me saying they are abjectly lying or attempting to mislead. I'm saying this is a high level projection targeted at analysts and not something where I'm going to get my hopes up. They have left a lot of outs or ways to be truthful without commitment. Do they see the Parks as the driving force? Absolutely - and that is accurate. Will that translate into more meaningful spend than we've seen? My jury is reserved there.

Now you’re trying to dance around what you described. You said “they don't truly intend to spend this” and intent is the issue that would make it misleading, a lie and a crime.

So again, even if they had concrete plans, have closed the door on economic concerns and view Epic Universe as a credible threat, how do they somehow front load the spending in a way that makes sense and which you would approve?

 

[Coaster Lover]

So, I guess D23 next year will see a whole lot more of the "this is maybe, possibly what we're thinking about doing... but maybe not..."

 

[Epcot82Guy]

Now you’re trying to dance around what you described. You said “they don't truly intend to spend this” and intent is the issue that would make it misleading, a lie and a crime.

So again, even if they had concrete plans, have closed the door on economic concerns and view Epic Universe as a credible threat, how do they somehow front load the spending in a way that makes sense and which you would approve?

Yes. I fully own my initial post was in the context of a more emotional response on a Disney message board. If we are going to talk about a more nuanced investment conversation, you are right. If they genuinely have no intent of spending this money and have "manufactured" it, we could have legitimate compliance issues brewing. What I should have said (as I hopefully clarified) was that this really suggests there are no concrete plans right now. These statements of spend have some truth, but it is blue sky ear marks right now IMHO. These statements are more likely being made (IMHO) to give the analysts something to see and to have something to say to any Epic Universe questions. Theme parks are an odd space because some key analysts often don't have a lot of knowledge of how the space works - especially as part of a larger organization. Disney (and Comcast, Six Flags, etc.) have gotten the luxury of setting the narrative a bit because the analyst pool is relatively niche (vs. things like content, branded consumer products and even hotels). But, that is a separate, much more minor conversation.

I will say I'm not understanding your second point on the rebalancing. They would announce and follow through on actual expansion plans and have a roadmap of where this spend is going. But, I'm not saying that's the right thing to do or even the financially responsible thing. And I think that's my confusion. My point is this $60B spend talk is really a bit of distraction from TWDC. It's not accompanying concrete 36 month plans. It's not even accompanying separately announced major expansions. So, I just don't see it as guidance that has much value today as a fan of the parks. There are many ways they could spend it now or in the future that would be wonderful. There are significantly more ways that would be problematic. And, on top, ways they could responsibly decide not to spend it at all. So, my point is simply that this statement doesn't give me much hope or despair, pro or con. And I'm a little disappointed Disney is doing something like that officially when we have fairly little on the official table in the coming years.

 

[Fido Chuckwagon]

I’m excited to see what happens to attendance when the parks become museums in 5 years.

 

[Nottamus]

Epic universe in a year or so

Epic-er universe after that

Disney: it’s only been 8 years - we still have to wait until end of NEXT decade

 

[doctornick]

Obviously this news is unfortunate, but people are also taking it to the extreme. $6B a year on the parks would be a pretty high spend but even if they were doing “only” $2B a year for the next 5 years, that would still likely be at least a few things coming to the parks in those years. I don’t think this news means there won’t be anything new until 2030 or whatever.

 

[arich35]

Obviously this news is unfortunate, but people are also taking it to the extreme. $6B a year on the parks would be a pretty high spend but even if they were doing “only” $2B a year for the next 5 years, that would still likely be at least a few things coming to the parks in those years. I don’t think this news means there won’t be anything new until 2030 or whatever.

I think it is the fact that they haven't announced anything concrete yet and if they are waiting to start those big projects they have teased in 5 years we have nothing new besides basically a retheme within 5 years

 

[ToTBellHop]

I think it is the fact that they haven't announced anything concrete yet and if they are waiting to start those big projects they have teased in 5 years we have nothing new besides basically a retheme within 5 years

Yeah…if I didn’t know better, I’d think all we will get by 2028 is Dino—>Indy from this news. Maybe whatever they want to replace Dino-Rama with. Sounds like the MK expansion is pushed out to 2030 or later.

I can’t wait for Epic Universe.

 

[PREMiERdrum]

"Due to severe mismanagement of both our creative arm and cashflow projections..."

We've literally reached the point where they have to invest significant cash into the thing to maintain share but the thing is relied on for cashflow to support the other things and the carousel won't stop spinning how do I get off...

It's a mess. But in the "back half" of the "next decade," we might see some dirt moving.

 

[Sirwalterraleigh]

So, I guess D23 next year will see a whole lot more of the "this is maybe, possibly what we're thinking about doing... but maybe not..."

Frankly…no one should go to those anymore until further notice.

It’s part of the problem

 

[Indy_UK]

So basically they're going to try and get D+ profitable so that the parks don't have to sustain it, which would allow them to finally reinvest as they'd probably like.

Doing it this way I agree with Totally. The parks should not be sustaining it but they also keep saying that Disney+ is going to turn a profit by late 2024. End of the decade is a large gap no?

Tells me Iger is going to bolt like he does best and leave it to be someone else's problem. Typical from this coward.

 

[NotCalledBob]

Tells me Iger is going to bolt like he does best

We can all keep our fingers crossed...

 

[Fido Chuckwagon]

that would still likely be at least a few things coming to the parks in those years.

There is nothing coming to the parks except popcorn buckets and emergency maintenance.

 

[Sirwalterraleigh]

There is nothing coming to the parks except popcorn buckets and emergency maintenance.

In a nutshell…yes.

But that shouldn’t surprise anyone. It fits the situation as they have designed it

 

[Tha Realest]

In a nutshell…yes.

But that shouldn’t surprise anyone. It fits the situation as they have designed it

Yesterday he completely dodged the question in WDW attendance and said we wouldn’t see any real ramp up in the WDW parks development until the latter part of the decade.

Can’t help but think of those two things in context with one another.

 

[GhostHost1000]

In a nutshell…yes.

But that shouldn’t surprise anyone. It fits the situation as they have designed it

we can't forget magical sprinkle cupcakes... the real driver to increases in gate clicks and guest spending