Disney's FY20 Q3 Earnings (8/4/20)

[WDW Pro]

No, but when the statement was made I don’t think they anticipated that June and July virus cases would be the worst they had been.

Given that New York and New Jersey have more deaths than all ID, MT, WY, UT, ND, SD, NE, KS, OK, TX, MO, AR, LA, WI, IN, OH, KY, TN, MS, AL, GA, FL, SC, NC, WV, CO, NH, and ME combined... I'm not sure things are worse than they have been. The death we saw in the New York metro area during the spring was horrific.

 

[HauntedPirate]

No, but when the statement was made I don’t think they anticipated that at this point the virus cases would be just about the worst they have been.

Very true, at the time they were likely somewhat realistic.

We can sit and discuss all we want whether or not those expectations were indeed realistic in the first place, but they are all with 20/20 (no pun intended) hindsight. Full disclosure - I expected crowds to be larger than what people have seen/reported so far, so to see/hear reports of 5-10 minute waits for several prominent rides not named 'Rise of the Resistance' is quite surprising.

 

[wdwmagic]

No, but when the statement was made I don’t think they anticipated that June and July virus cases would be the worst they had been.

Absolutely, I do'nt think they ever thought that they would be reopening with 10k new cases per day.

 

[CaptainAmerica]

Don't think that quote aged well...

Woof. WDW was standing in the middle of both streams in a ing contest between Cuomo and DeSantis.

 

[tirian]

Should we take a shot every time someone mentions “the unprecedented times,” or will that send too many of us to the E.R.?

 

[Beacon Joe]

I'm a Boglehead, so I'm not a stock picker. But I did set up a small taxable account for my son to "play" in and learn using some of his own savings and earnings. He wanted to invest entirely into DIS, but I made him put 50% in a low-cost indexed ETF. Making him listen into today's shareholder meeting. Should be a good lesson for him in portfolio diversification!

 

[asianway]

You're not lying. Similar to the predictions not materializing for previous 18 month expansions, they've not been able to meet 25% capacity, little alone 50%.

So much for the rumors of selling the park in four hour increments to meet demand

 

[HauntedPirate]

Should we take a shot every time someone mentions “the unprecedented times,” or will that send too many of us to the E.R.?

If I did that, I'd have died months ago from alcohol poisoning.

 

[CastAStone]

I have a work meeting and a playoff hockey game to watch during the call plus I have to pick up my kids but dammit I'm listening to this call.

 

[peter11435]

Given that New York and New Jersey have more deaths than all ID, MT, WY, UT, ND, SD, NE, KS, OK, TX, MO, AR, LA, WI, IN, OH, KY, TN, MS, AL, GA, FL, SC, NC, WV, CO, NH, and ME combined... I'm not sure things are worse than they have been. The death we saw in the New York metro area during the spring was horrific.

WDW is not in New York or New Jersey. You know that and you know exactly what I meant.

 

[el_super]

The question is whether they need more reductions than has already happened with the loss of contractors of cancelled projects, cancellation of CP, and cancellation of International CMs.

And whether there were secret lay-offs this week.

Also, with their front-line CMs that are under different union agreements, it will be interesting to see if they have a plan for them. Typically non-full time CMs can just be given fewer hours per week. That avoids the nasty designation of a "layoff" but really, some CMs will not be able to afford to work with only 4 to 8 hours a week.

Some of their front line CMs are full time and are contractually guaranteed hours. I haven't seen or heard anything (from WDW) to indicate that they have made any agreements with the unions on how to handle this (whether the union is agreeing to layoffs or dropping status/guaranteed hours). At DL they are continuing to prepare for park opening (but at a slower rate than before), and I would imagine they have to avoid any meaningful layoffs there until they are open. But the majority of their front line cast is also still stuck at home not collecting a paycheck.

Long Story Short: there's still a lot they can cut back on without having to call them "layoffs."

 

[HauntedPirate]

In anticipation of poor Q3 earnings, I am pre-emptively calling for Bob Chapek's resignation as CEO (so no one can accuse me of doing it after the call). "He obviously doesn't have the chops to guide TWDC, just look at the poor Q3 earnings report!!" (end sarcasm)

(Just kidding, @realBobChapek !! We all know it's the other Bob's fault )

 

[Sirwalterraleigh]

I initially wrote CMs but honestly the amount they paid to IT consultants to stand up the park reservation system is probably incomprehensible.

I bet the “under” on that

It's going to be a historic call in Disney history. After seeing the massive 90-plus percent drops for competitors, Disney's is going to really be something.

Ehhh...fancy accounting tricks and twisting. They won’t take it on the nose publicly...to the fullest extent of the grey area of the law. My guess.

I know an "analyst" who will say they spent $2.50.

Total.

I’d say that’s a lot closer to the truth than those under the perception that Disney parks are “well run” will ever believe

 

[Sirwalterraleigh]

Also, with their front-line CMs that are under different union agreements, it will be interesting to see if they have a plan for them. Typically non-full time CMs can just be given fewer hours per week. That avoids the nasty designation of a "layoff" but really, some CMs will not be able to afford to work with only 4 to 8 hours a week.

Some of their front line CMs are full time and are contractually guaranteed hours. I haven't seen or heard anything (from WDW) to indicate that they have made any agreements with the unions on how to handle this (whether the union is agreeing to layoffs or dropping status/guaranteed hours). At DL they are continuing to prepare for park opening (but at a slower rate than before), and I would imagine they have to avoid any meaningful layoffs there until they are open. But the majority of their front line cast is also still stuck at home not collecting a paycheck.

Long Story Short: there's still a lot they can cut back on without having to call them "layoffs."

This is true...

The corona bills...if Disney received some (logical)...is also a playbook to handle layoffs.

That time will come but it’s not here quite yet.

Disney’s probably excited...they love to eliminate salary, benefits, and less lb for lb value in their employement ranks when they have cover. That will be a “slow roll”
Over the next couple of years if i have to make a guess.

 

[oceanbreeze77]

Should we take a shot every time someone mentions “the unprecedented times,” or will that send too many of us to the E.R.?

theres no room

 

[Magic Feather]

One of the big things blamed for lack of attendance is inter-state quarantine orders. Some people don’t want to risk having to quarantine for 2-weeks just for a trip or else potentially being fined (or in some states sent to jail).

The “Florida Flare Up” is largely to blame for the above issue though.

 

[WDW Pro]

WDW is not in New York or New Jersey. You know that and you know exactly what I meant.

With essentially no international travel, Disney depends on guests from all those states. Florida cases have always had little impact, while deaths per million rising in Florida would put tremendous pressure on reclosing.

 

[britain]

I'm a Boglehead, so I'm not a stock picker. But I did set up a small taxable account for my son to "play" in and learn using some of his own savings and earnings. He wanted to invest entirely into DIS, but I made him put 50% in a low-cost indexed ETF. Making him listen into today's shareholder meeting. Should be a good lesson for him in portfolio diversification!

Good for you! Disney stock was my first exposure to the market. (I miss the slick annual reports they used to make. Drool...) I don't have any Dis stock now. I'm glad I put some money in Apple back when the iPhone was new!

 

[Sirwalterraleigh]

Given that New York and New Jersey have more deaths than all ID, MT, WY, UT, ND, SD, NE, KS, OK, TX, MO, AR, LA, WI, IN, OH, KY, TN, MS, AL, GA, FL, SC, NC, WV, CO, NH, and ME combined... I'm not sure things are worse than they have been. The death we saw in the New York metro area during the spring was horrific.

That’s because they were on the frontlines when nobody knew a damn thing and the government failed in historic proportions.

Out of your lane on this one. The tragedy was higher here in the spring...the stupidity is higher elsewhere now. All the intelligent humans agree.

One of the big things blamed for lack of attendance is inter-state quarantine orders. Some people don’t want to risk having to quarantine for 2-weeks just for a trip or else potentially being fined (or in some states sent to jail).

The “Florida Flare Up” is largely to blame for the above issue though.

It’s a huge issue...but you’d likely be surprised how little it would change if they dropped the quarantines under the current conditions on the ground. Travel will never resume with this lack of control/fear. Not nearly to the level to stop the bleeding.

 

[peter11435]

With essentially no international travel, Disney depends on guests from all those states. Florida cases have always had little impact, while deaths per million rising in Florida would put tremendous pressure on reclosing.

Yes, that’s the point. Disney depends on guests from around the world and guests from those states. Current conditions in the US and specifically Florida, make it a dangerous, challenging, and sometimes impossible destination. Florida’s rising cases numbers and deaths have had a huge impact on the reopening.