The big crowds we’ve been seeing in Disney World recently might suggest that The Walt Disney Company has been doing “okay” financially from a parks perspective, but dropping stock numbers could show a different picture. Now we’ve got a much better idea of where things stand as Disney has released theirs Quarterly earnings report for the Second quarter of fiscal year 2022General Chat Chat Lounge
The Earnings Report for the Second Quarter of Fiscal Year 2022 covers some early months in 2022, ending on April 2nd, 2022. These early months have had some pretty major events for Disney. We’ve seen restaurants reopen in the parks, the release of a popular Marvel show on Disney +, a couple of big announcements about ongoing projects, and more. So how are the parks, Disney +, and other aspects of the company doing REALLY? Let’s see the numbers.
Overall Financial Results
Overall, Disney has shared that Revenues for this past quarter (Q2 of FY 2022) and six months grew 23% and 29%, respectively. There is a reduction of $ 1.0 billion for certain amounts due to the end of certain license agreements and other matters.
Certain diluted earnings per share numbers DECREASED while others increased. Specifically, “Diluted earnings per share (EPS) from ongoing operations for the quarter reduced to $ 0.26 from $ 0.50 in the prior-year quarter. ” But, excluding certain items, the “Diluted EPS for quarterly increase of $ 1.08 from $ 0.79 in the prior-year quarter. “
When you look at the EPS for continued operations for the 6 month period that ends on April 2nd, 2022, that EPS actually increased to $ 0.89 compared to $ 0.52 in the prior-year period.
Disney CEO Bob Chapek expressed a sense of optimism moving forward. In the earnings report, Chapek shared, “Our strong results in the second quarter, including fantastic performance at our domestic parks and continued growth of our streaming services—With 7.9 million Disney + subscribers added in the quarter and total subscriptions across all our DTC offerings exceeding 205 million—Once again we are in a league of our own. “
Chapek continued by saying, “As we look forward to Disney’s second century, I am confident we will continue to transform entertainment by combining extraordinary storytelling with innovative technology to create an even larger, more connected, and magical Disney universe for families and fans around. world. “
Let’s take a look at some of the specific numbers.
Impact of COVID-19
In many ways, Disney is returning to a “normal” state of the theme parks and releases with theatrical. Recently, face masks were dropped in all areas except Disney World and Disneyland at certain portions of First Aid stations. And some of the latest movies have had very successful opening weekends at the box office in theaters.
But is COVID-19 still affecting Disney’s earnings? Disney continues to be impacted by COVID-19 in some ways. In the earnings report, Disney notes, “COVID-19 and measures to prevent its spread have impacted our numbers in a number of ways.”
When it comes to the parks and resorts, Disney shared that they are “Generally operating without significant COVID-19-related capacity restrictionssuch as those that were in place in the prior year. “
But, some of their “international Parks and resorts and cruise ship operations continue to be impacted by COVID-19-related closures and capacity and travel restrictions. ” We certainly saw things like the closure of Shanghai Disneyland (which still doesn’t have a reopening date).
In terms of media, Disney shares that their film and TV products are generally back, but they are have “seen disruptions of production activities depending on local circumstances.” Most Disney films have been able to be released in theaters during fiscal 2022, but some markets are still imposing restrictions when it comes to openings and capacity.
Disney shares, “We have incurred, and will continue to incur, costs to address government regulations and the safety of our employees, guests and talent.of which certain costs are capitalized and will be amortized over future periods. “
Click here to see 18 rules to follow now that normal character meet-and-greets are back in Disney World
Disney Parks, Experiences, and Products
When it comes to Parks, Experiences, and Products, revenues for this past quarter (Q2 of FY 2022) are more than DOUBLE what they were during the prior-year quarter. Specifically, Disney shared that “Revenues for quarterly increase to $ 6.7 billion compared to $ 3.2 billion in prior-year quarter. ” The segment operating results also increased to “a loss of $ 1.8 billion compared to $ 0.4 billion in the prior-year quarter.”
According to Disney, this operating income growth at the domestic parks was due to Higher volumes and INCREASED guest spending. What brought about higher volumes? Disney notes that the higher volumes were due to “Increases attendance, occupied room nights and cruise ship sailings.”
Guest spending has also grown in the parksGeneral Chat Chat Lounge According to Disney, the growth in guest spending was due to “an Increase in average per capita ticket revenue, higher average daily hotel room rates and an Increase in food, beverage and merchandise spending. “
The increase in per capita ticket revenue is due to a number of factors including the introduction Genie + and Lightning Lanes.
Things in this quarter are also dramatically different than they were a year ago. During Q2 of fiscal year 2022, the domestic parks were open for the entire time, while Disneyland was actually closed during the prior-year quarter and Disney World was operating at a reduced capacity during the prior-year quarter.
There were some more complicated situations when it came to international parks, like Hong Kong Disneyland, were actually open for less days than the current quarter compared to the prior-year quarter, but there were some improved results at certain international parks.
When it comes to merchandise, Disney shared that the growth in licensing was “driven by higher sales of merchandise based on Mickey and Minnie, Spider-Man, Star Wars Classic and Disney Princesses. “
Here’s a look at some of the parks numbers.
You can see where Parks & Experiences reached a total of $ 4.898 (in millions) this quarter, compared to just $ 1.735 (in millions) in the same quarter in 2021.
Disney + Subscriber Numbers
Disney has been ambitious with their goals for Disney + subscriber numbers. We’ve seen the number of subscribers rising over the past few quarters, and this time is no different.
Overall, the total number of Disney + subscribers during Q2 of 2022 is 137.7 million.
That’s a substantial jump from the previous subscriber numbers we saw back in February – at which point Disney + had a total of 129.8 million subscribers.
Click here to see our post on the updated numbers!
In terms of other media updates, Disney shared that ESPN viewership is up with ratings up to double digits.
You can also see that Hulu subscriptions are also up compared to the prior-year quarter.
In terms of media generally, Linear networks saw an increase in revenue compared to the prior-year quarter, though operating income decreased. Direct-to-consumer revenue also increased compared to the prior year quarter, and operating losses increased.
According to Disney, “The increase in operating loss was due to higher losses at Disney + and ESPN + and lower operating income at Hulu.”
For Disney + those lower results were a reflection of “higher programming and production, marketing and technology costs, partially offset by an increase in subscription revenue. Higher subscription revenue was due to customer growth and increases in retail pricing. The increases in costs and customers reflect growth in existing markets and, to a lesser extent, expansion to new markets
For the full quarterly earnings report, click here.
We’ll keep updating this post as we learn more from today’s Second-Quarter Earnings report and call. Keep following DFB for the latest news from Disney!
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What statistics from Disney’s Second-Quarter Earnings Call are you surprised? Let us know in the comments.