TWDC 2QFY16 Earnings Call Thread

[RSoxNo1]

Hulk isn't terrible....I enjoy it....but it is just a coaster which theme parks everywhere pretty much have. Don't get me wrong, I love a good coaster my point was hulk does not compare to something like potterland as a whole and in terms of draw

I'm not too keen (yet anyways) on the slinky dog coaster coming to DHS either based on what I've seen and don't even get me started on the mine train which other than the scenes inside is one of the most overrated rides at WDW imo

The Hulk is a very good (albeit disorienting) coaster. It is lightly themed and is a step above what you'd find at most Six Flags. As a coaster though, I don't like the pacing of it and prefer Kraken at Sea World.

Having said all that, I'm looking forward to riding it with the audio as that has a tendency to help coasters dramatically.

 

[FullSailDan]

Do they EVER know when to stop pushing? I mean, really. I hate to think of what ticket prices will cost in 5-8 years going by what's happened in the past few.




I'm not a HP fan (like, at all- just saw the movies for the first time last year. Refuse to read the books.) but I'm quite excited to see new lands and experience what so many people have ranted and raved about Universal and specifically the HP areas. I bit the bullet and booked 4 days/nights (soon to be 6) at Cabana Bay and the price difference is astonishing. Hence adding two more days. Even if we don't go to the parks, and just hang around the resort, I'm fine with that. And it's still less than the first leg of my trip. (Is this a bad time to mention how irritated I am to have to pre plan everything at Disney and absolutely NOTHING at Universal... especially 180 days out?!)

I AM a Potter fan and will say Universal NAILED IT with Diagon Alley in terms of atmosphere. I'm so utterly turned off though by Universals 4D rides and was completely unimpressed by escape from Gringotts and Forbidden Journey. The queue in Gringotts could be an attraction on its own though, really well done, you feel like you're in that world. If Disney can capture that in Star Wars/Toy Story/Pandora and add some neat attractions, theyd be golden.

 

[RobbinsDad]

I AM a Potter fan and will say Universal NAILED IT with Diagon Alley in terms of atmosphere. I'm so utterly turned off though by Universals 4D rides and was completely unimpressed by escape from Gringotts and Forbidden Journey. The queue in Gringotts could be an attraction on its own though, really well done, you feel like you're in that world. If Disney can capture that in Star Wars/Toy Story/Pandora and add some neat attractions, theyd be golden.

I haven't experienced Gringotts but IMO Forbidden Journey is one of the best attractions ever done, anywhere. Absolutely thrilling.

 

[Disneyhead'71]

I AM a Potter fan and will say Universal NAILED IT with Diagon Alley in terms of atmosphere. I'm so utterly turned off though by Universals 4D rides and was completely unimpressed by escape from Gringotts and Forbidden Journey. The queue in Gringotts could be an attraction on its own though, really well done, you feel like you're in that world. If Disney can capture that in Star Wars/Toy Story/Pandora and add some neat attractions, theyd be golden.

If you found Forbidden Journey to be unimpressive, then I think you'll be disappointed in almost everything any of the parks build.

 

[FullSailDan]

If you found Forbidden Journey to be unimpressive, then I think you'll be disappointed in almost everything any of the parks build.

I think it comes down to style and pacing. Universal loves to jerk the ride vehicle around from one location to another with a pause in between for some sort of video or action. Spiderman and Transformers are the king of this. Forbidden Journey is better but still wonky in my opinion. The technology is cool and impressive, I'm just not personally overjoyed at the end result of the implementation in the universal rides.

 

[Brad Bishop]

Most guests have no clue what is coming and when...I don't buy that. I think it's sticker shock at the price to go these days and those that do go often the quality decrease

I think you're on the right track, although I think your average Disney guest doesn't really know what's going on down there outside some tidbits, at best.

I think your average tourist thinks in terms of:
- How much is it going to cost?
- What's new?

I think that's about it. They can point to their regional Six Flags, Cedar Fair, or even local amusement park and say to themselves, "Oh, Six Flags just added that new coaster/thrill ride/water park and it looks REALLY cool!"

I bet most don't know what's going on at WDW. I bet most aren't even aware of NFL. If someone were to tell them, "Oh, Soarin' got a new theater!," they wouldn't care. Soarin' getting a new theater isn't new and cool. At best it means less wait time for something they've seen. "They replaced Maelstorm with Frozen!" "You mean a whole new ride?" "No.. Just new sets" "Oh..." It's not exciting. So Maelstrom, which arguably wasn't great to start with, now has Anna and Elsa singing that annoying song over and over again (I don't know if it is like this - I'm saying from the non-Disney fan point of view - this is where their thoughts are going). Nah...

Then they look at the price:
- WDW = $REALLY EXPENSIVE
- local theme park or camping or something else - not so much.

So, in their minds they arrive at: WDW is really expensive and we've pretty much seen it (nothing new).

At one time there was excitement: "MK got Space Mountain!! It's a freaking indoor rollercoaster IN THE DARK!!" (I remember me and my friends being excited for this when I was young). I remember, "Splash Mountain is coming! That's going to be awesome!" I remember, "Big Thunder Mountain has finally been built - Man I wish I could ride that!"

Now it's more like, "I think Fantasyland got a new ride." (if they know that much).

There was buzz when I was a kid (1970s).
There was buzz in my teens (1980s).
There was buzz in the 1990s (all of that expansion).
After 2000, it kind of got quiet. Mission: Space maybe created a little buzz - probably had more to do with the deaths than anything..

The big buzz from Orlando since 2000 has been Harry Potter lands!

WDW is stale. Yeah, they're trying to address it (finally) but again, you've got no buzz for about 15 years.

 

[Brad Bishop]

Don't know how any company can be "very pleased" with less guests visiting. Yes, you've made more money but it kind of proves you are starting to put people off.

To be fair, there's a point where your parks just reach saturation and they're just not going to get any more crowded and you've, effectively, reached your peak. MK is probably there, now. The rest, not so much.

 

[JohnD]

Interesting article. Read into what you will:

Why Disney's CEO was left 'surprised' after 45 minutes of questioning

 

[Pumbas Nakasak]

I am not shocked that WDW hae a small decrease in attendance thiw quarter. Seaworld announced they did due to Brazil's economy. Universal also announced their attendance in the US was stable. That means the same qs the prior year. Now there are 2 ways to take that. Either their Hollywood expansion is a disaster or they also had an increase out west and a decrease in Orlando. I tend to believe both companies har a drop in Florida attendance due to Brazil which would be backed up by the fact on one thread here someone posted they got a room at Cabana Bay for $55.00 a night. Don't worry though both companies are doing very well ae 88% occupancy rates are to something every other hotel company would love to have.

So why were the Orlando Tourist agency bumming about the biggest year ever? Folk coming to Florida and ignoring the parks? Alarm bell time surely?????

 

[seascape]

So why were the Orlando Tourist agency bumming about the biggest year ever? Folk coming to Florida and ignoring the parks? Alarm bell time surely?????

2015 was a record year. 2016 is not a bad year for Disney. A small decrease in attendane is more than made up for by increases in ticket prices, food prices and hotel prices. Remember 88% hotel occupancy rate is fantastic. I know it means a lot of empty rooms when you have over 30,000 rooms but if you think of it as each room is filled just under 9 out of every 10 nights you realize any other hotel company would die for that rate.

Now I have no problem paying the massive increase in my annual pass especially if it lowers the over crowding. As for why people can afford it read the story athttp://www.marketwatch.com/story/the-best-financial-decision-i-ever-made-is-one-in-which-i-didnt-have-a-choice-2016-05-12 . It shows why you can't just look at the cost and individual price increases. Society has changed. Family sizes are much smaller and that is why middle class families can afford the outrageous prices Disney and Universal charge.

 

[Pumbas Nakasak]

OK I read the propaganda, I can tell its all fantastic the cash is flooding in and all is well with the world, Brazilians excluded. So this modest decline when you have your biggest pool of visitors to draw from, is it the locals staying home? Does it matter not a jot its fantastic and its only a modest decline, shell be right.

 

[seascape]

OK I read the propaganda, I can tell its all fantastic the cash is flooding in and all is well with the world, Brazilians excluded. So this modest decline when you have your biggest pool of visitors to draw from, is it the locals staying home? Does it matter not a jot its fantastic and its only a modest decline, shell be right.

OK I read the propaganda, I can tell its all fantastic the cash is flooding in and all is well with the world, Brazilians excluded. So this modest decline when you have your biggest pool of visitors to draw from, is it the locals staying home? Does it matter not a jot its fantastic and its only a modest decline, shell be right.

Brazil is a problem. Locals staying away may sound horrible but both Disney and Universal care about customers staying in their hotels and not the people who live near the park. It is only a few years away when Universal has their 3rd and maybe 4th gate that they will show thay are like Disney and charge $1,000.00 a year for an annual pass. Don't think for a second tbat both companies are not interested in anything but the bottom line. Again that means tourists staying in their hotel rooms and timeshares and eating on property. BTW dont you find it amazing that only Disney has RTU timesharea that end in 50 years so they can sell them again to a whole new set of owners. What a deal. Expect Universal to copy them soon. But both companies will continue to make a fortune.

 

[disneyflush]

Society has changed. Family sizes are much smaller and that is why middle class families can afford the outrageous prices Disney and Universal charge.

A lot of middle class families have a way of 'making it work' I guess by putting it on a credit card or 3 but that doesn't make it affordable. I'm not digging at you at all, I think we actually share the same viewpoint on this.

 

[raven]

To be fair, there's a point where your parks just reach saturation and they're just not going to get any more crowded and you've, effectively, reached your peak. MK is probably there, now. The rest, not so much.

That's only because Disney has hacked away at the other parks leaving guests with less to do there. It isn't because more people are visiting. It's because guests are feeling they aren't getting their money's worth at the other parks so they go to MK which is currently the only park where every section is actually open.

 

[ANJ]

Well. Looks like some of the leadership departures make more sense now. The DCP change especially, although how many quarters does Pitaro have to right the ship? And how long does Skipper have?

That's an excellent point. You think the abrupt dismissal of Mr. Staggs was just coincidental? Just a few weeks before the quarter call? Iger's little buddy? The man in waiting gets the ax? It just doesn't pass the smell test.

 

[DisneyManOne]

I quote from this article: http://finance.yahoo.com/news/disney-second-quarter-cable-consumer-long-term-magic-141820223.html

Most importantly, Iger emphasized his view of Disney as an intellectual property play with long-term runway, implying that many of the analysts were missing the mark.

“Before you ask me a question,” he said on the conference call, “I think it’s really important with this business not to look at it as a quarterly business. Because we’re not only continuing to support the 11 billion-plus franchises that we have as a company, but we continue to create intellectual property that is leverageable across our consumer products businesses.” Iger added, “It’s a kind of business that I think is very difficult to measure in terms of the bottom line success on a quarterly basis. We just don’t run it that way.”

Sanford Bernstein analyst Todd Juenger defended the stock in a note on Wednesday, “Once properly re-set, few entertainment companies have the durability, diversification, and raw IP-creating power and library of Disney. Which is why we continue to stubbornly and very proactively hold our opinion that, for a while, the stock is stuck.”

While Disney’s mix shift away from “longer-cycle” areas like media and toward studio, which has historically been difficult to forecast, may be spooking investors, according to RBC. But with Disney’s intellectual property footprint and impact of character rollouts across Marvel, Pixar, and Lucas, a conclusion that the magic is gone may be overdone.

That's what gets me most peeved. Disney is not--and never was to be--an intellectual property. Disney was something special, but the tyranny of Michael Eisner and Robert Iger have caused it to be what the public perceives Disney to be: a cold, soulless, money-hungry corporate machine desperate to own everything in the world and milk it out to the point of no return.

I sincerely hope that whoever comes along to dethrone Iger is nothing at all like his predecessors. I hope he has the passion and optimism Walt had, and none of the executive greed.

Honestly, to me, I wonder if the Eisner years truly did end...

 

[ford91exploder]

I think you're on the right track, although I think your average Disney guest doesn't really know what's going on down there outside some tidbits, at best.

I think your average tourist thinks in terms of:
- How much is it going to cost?
- What's new?

I think that's about it. They can point to their regional Six Flags, Cedar Fair, or even local amusement park and say to themselves, "Oh, Six Flags just added that new coaster/thrill ride/water park and it looks REALLY cool!"

I bet most don't know what's going on at WDW. I bet most aren't even aware of NFL. If someone were to tell them, "Oh, Soarin' got a new theater!," they wouldn't care. Soarin' getting a new theater isn't new and cool. At best it means less wait time for something they've seen. "They replaced Maelstorm with Frozen!" "You mean a whole new ride?" "No.. Just new sets" "Oh..." It's not exciting. So Maelstrom, which arguably wasn't great to start with, now has Anna and Elsa singing that annoying song over and over again (I don't know if it is like this - I'm saying from the non-Disney fan point of view - this is where their thoughts are going). Nah...

Then they look at the price:
- WDW = $REALLY EXPENSIVE
- local theme park or camping or something else - not so much.

So, in their minds they arrive at: WDW is really expensive and we've pretty much seen it (nothing new).

At one time there was excitement: "MK got Space Mountain!! It's a freaking indoor rollercoaster IN THE DARK!!" (I remember me and my friends being excited for this when I was young). I remember, "Splash Mountain is coming! That's going to be awesome!" I remember, "Big Thunder Mountain has finally been built - Man I wish I could ride that!"

Now it's more like, "I think Fantasyland got a new ride." (if they know that much).

There was buzz when I was a kid (1970s).
There was buzz in my teens (1980s).
There was buzz in the 1990s (all of that expansion).
After 2000, it kind of got quiet. Mission: Space maybe created a little buzz - probably had more to do with the deaths than anything..

The big buzz from Orlando since 2000 has been Harry Potter lands!

WDW is stale. Yeah, they're trying to address it (finally) but again, you've got no buzz for about 15 years.

I'd disagree with that as just ask any 10 year old what park they would like to visit Disney or Universal, The answer is "Universal, Disney is for LITTLE KIDS", That's a really bad NEGATIVE buzz because a LOT of us long term Disney fans started at 13-16 we were not turned off to Disney by the time we hit 10.

 

[Brad Bishop]

I'd disagree with that as just ask any 10 year old what park they would like to visit Disney or Universal, The answer is "Universal, Disney is for LITTLE KIDS", That's a really bad NEGATIVE buzz because a LOT of us long term Disney fans started at 13-16 we were not turned off to Disney by the time we hit 10.

I think you have a point there. There was a time when it was more of an overall wonderful theme park experience (Pirates, HM, IaSW, etc.). Then it kept getting kind of "dumbed down" for kids (didn't start with Iger) with:
- introducing characters into Epcot
- making every little girl a princess
- making everything "ride the movie" which, while it's not bad, it shouldn't be the only thing (look to Pirates, Tiki, HM, etc for things that have lasted that aren't "ride the movie")
- Making Tomorrowland IP-land (if anything, this used to be one of the places boys would gravitate towards - that and Adventureland/Frontierland)

It's also kind of a fault of the patrons, too, looking for their little girls to be princess for a day or the endless strollers (I don't remember them being as prevalent when I was a kid - it was pretty much a deal where you had to walk for a good part of the day before your parents took you to WDW). WDW plays into this as I mentioned above.

I think that the way that they market MK now is pretty much "Princessland".

 

[rael ramone]

Interesting article. Read into what you will:

Why Disney's CEO was left 'surprised' after 45 minutes of questioning

I think he's used to Zenia protecting him from tough questions...

 

[n2hifi]

A lot of middle class families have a way of 'making it work' I guess by putting it on a credit card or 3 but that doesn't make it affordable. I'm not digging at you at all, I think we actually share the same viewpoint on this.

I see it from a different perspective. I think it's as affordable as ever but people have such big credit card debt now that they can't afford it. Gotta have the latest flat panel..., Oh! and new car every few years. What about a house I really can't afford but the bank said I could buy anyway. I make essentially the same as I did five years ago. I couldn't afford a Disney trip then so I put it on credit. After a lifestyle change (Dave Ramsey) I have my trip in November fully paid with cash in the bank. Same basic trip with 6 days at Poly. The difference is what I do with the rest of my money. I think affordability is somewhat perspective, not just income.