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.
It's easy to be "very pleased" when you're thinking in the immediate short-term and don't plan on being around for the long-term ramifications.
A drop in attendance "solves" capacity issues and an increase in guest spending thanks to the jacked up prices combined with slashed costs from cuts will keep profits up despite attendance drops. The problem is what happens when you continue this behavior over a horizon longer than a few quarters.
If they're not there yet, they're right on the cusp of pushing prices too far (and I'd argue they have already) to the point where they'll start to see more than just "modest" drops in attendance, whether by choice or by inability to pay. Right now, their strategy works because they make more revenue from the $ increases than they lose from the attendance decline.
But... when the revenue from your price increase is offset by a loss of revenue due to the resulting drop in attendance, that money making lever is BROKEN and can't be pulled any more.
Same thing with cost cuts. I like how
@WDW1974 put it... they're strip mining the place. They quality of show, service, maintenance, etc. was previously so high that they were able to make cuts to it without all but the observant few noticing. Then they cut again. And cut again. And again. And they're eyeing more. But you can only strip mine so much before you destroy the land.
And of course, they run into the same problem... there's only so many times you can pull that lever and have it be beneficial. Eventually, as you keep reducing expenses, it starts to cause noticeable quality issues that are being seen by more than just the observant few.
And at some point, people will stop paying through the nose to go visit a half-functioning dump when they can visit the property down the road that is doing things the right way or even *gasp* take a vacation somewhere other than Orlando. Then that lever is BROKEN.
And when you can't increase prices or cut costs to grow profits anymore, you can either play an extraordinarily expensive game of catch-up to return to the standard that made you the best in the business... or you can fail. Even the "brand" isn't strong enough by itself to prop up what would amount to a giant waste of money.
I'd much rather they figure this out while they're on the road to destruction instead of when they've made it to the front gate... but that isn't going to happen with current leadership who are "very pleased" to leave the ghost of WDW for the next poor sap to fix.
