The Wall Street Journal did the math. Two families with two kids, staying at an inexpensive hotel, spend $4,266 at Walt Disney World. That is up from $3,230 five years ago. It is worth noting that the median household income in the United States is $80,610, and that is before taxes.
There are worries among investors that the parks are too expensive. The anchor parks are Disneyland Park in Los Angeles, opened in 1955, and Walt Disney World in Lake Buena Vista (near Orlando), which opened in 1971. That list has grown to Tokyo, Japan; Paris, France; Hong Kong; and Shanghai, China.
Most of the excitement around recent Walt Disney Co. (NYSE: DIS | DIS Price Prediction) earnings was that its streaming business, which has lost billions of dollars, is finally making money. Called the “direct-to-consumer” business, its revenue rose by 9% to $6.1 billion. It went from a loss of $138 million in the quarter the year before to an operating profit of $298 million in the most recent period.
Direct-to-Consumer was a modest portion of the quarter’s total. Disney had revenue of $24.7 billion, up 5%, last quarter. Net income before taxes was $3.7 billion, up 27% year over year.
“Experiences” is the main event of Disney’s quarter, and has been for years. Almost all of it comes from Disney theme parks. Experiences revenue was up only 3% to $9.4 billion. Operating revenue was flat at $3.1 billion. It is easy to see why it is Disney’s most important business. Management said Hurricanes Milton and Helene had affected attendance, but they only hit one location—Walt Disney World—for a few days.
Late last year, CNBC made a crucial observation: “Why a Disney vacation may have gotten too pricey for the average American family.” The media outlet did not give a direct answer, but it certainly focused on it as a risk to Disney’s earnings.
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