Disney Expects Softer Attendance Trend To Continue at Walt Disney World and Disneyland

Aug 07, 2024 in "The Walt Disney Company"

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Bob Iger at Walt Disney World

Posted: Wednesday August 7, 2024 9:34am ET by WDWMAGIC Staff

In this morning's investor Q&A session, Disney CEO Bob Iger and CFO Hugh Johnston discussed key issues surrounding the company's theme parks and experiences, including ongoing cost reduction efforts, attendance levels, and expected demand moderation in the coming quarters.

EPCOT World Celebration

Cost Reductions and Strategic Investments

Disney has been actively pursuing cost reductions to enhance its bottom line while continuing to invest in its parks and experiences. CFO Hugh Johnston highlighted that Disney initially set a cost reduction target of $5.5 billion, which has since been increased to over $7.5 billion. Johnston emphasized the company's commitment to driving productivity and efficiency, stating, "In big companies, my worldview is there's always an opportunity to do more with less, so we're going to continue to go after it aggressively as we can to both deliver the bottom line and to invest back into business with all the great opportunities we have."

Despite these reductions, Disney says it remains committed to making strategic investments in its parks and experiences. Johnston noted that while the company is mindful of cost, it also recognizes the importance of continuing to invest in areas that will drive future growth, particularly in its theme parks and cruise lines.

Disney's Parks and Experiences Revenue Up in Q3 FY2024, But Operating Income Declines

Attendance and Revenue Outlook

During the Q&A, Iger and Johnston addressed concerns about attendance at Disney parks, acknowledging a slight decline in the third quarter. However, they were quick to note that the decrease was not drastic and attributed some of the softness to broader economic factors. Johnston explained, "We saw attendance [was] flat in the quarter, and perhaps [it was] up a little bit. We expect to see a flattish revenue number in Q4 coming out of the parks."

Looking ahead, Disney anticipates that this trend of flat or slightly declining attendance may continue for the next few quarters, with revenue expected to remain steady. Johnston mentioned that this is not indicative of a prolonged downturn, but rather a temporary moderation in demand that the company is closely monitoring.

Johnston attributed some of the loss in demand to economic pressures on lower-income consumers and an increase in international travel, which may be diverting potential domestic visitors. He said, "Lower-income consumers [are] feeling a little bit of stress, [and] higher-income consumers [are] traveling internationally a bit more."

Speaking later on CNBC, the Disney CFO said, "In reality, people will tend to hang on to their vacations quite strongly because it's an important piece to the family unit. And as a result, we think this is just going to be a few quarters and we'll be fine coming out of it."

The company is also keeping a close eye on potential impacts from the upcoming Olympic Games, particularly at Disneyland Paris, where a temporary reduction in consumer travel is expected due to the event. However, Iger expressed confidence that these challenges are short-term and that the overall outlook for the parks remains positive, especially as new attractions and cruise ships come online in the coming years.

D23: The Ultimate Disney Fan Event will take place August 9-11, 2024, where Disney is expected to announce a number of upcoming attractions and experiences for Walt Disney World and Disneyland.

Horizons: Disney Experiences Showcase D23 2024

Discuss on the Forums

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The Mom2 days ago

Once again, this thread is about attendance at WDW. Not movies.

Disstevefan12 days ago

Agreed, but I think the constant price increases on everything can mostly compensate for the less full resorts (aka lower attendance).

rd8052 days ago

Disney found their golden goose by monetizing fastpass, and then introducing an even more expensive fast pass. My guess is that their numbers ended up DECENT in 2024 because of this; but again, the lack of new experiences coming (added with everything else we've discussed for a year+) will probably keep the resorts less full again in the next year.

monothingie2 days ago

It's going to be rough. The Disney brand is damaged, there is increased competition from their rivals up I 4 with their brand new park, the prices keep going up, and there's nothing significant coming online for at least the next 3 years. The current strategy of squeezing the guests is not going to continue to yield the results they want. There has to be a realization that some value needs to be injected into the equation. Burbank always leans heavily into the the Experiences segment because Josh's group prints money for the company. I'm not going to understate that Disney has a lot planned for the end of the decade, but that's 4-5+ years from now, and things change from concept, and the current track record is not for the better. Does a new DVC, A Cars Ride, a Monsters Inc. Ride, A re-themed RNR, a new Encanto Ride, and a re-themed Indy Ride move the needle? If the price is 20-30+% more than it is today...then no.

Cliff2 days ago

Perhaps 2025 could be a trusted year to do all of that...."again". Walt Disney World has always been the king of Orlando and there really are no other viable choices in 2025. WDW has always been a theme park monopoly in that city and it makes sense to keep leaning on that fact in 2025. So, yeah,..I think Burbank will be safe to use Parks and Experiences as another life vest again. Parks are the trusted "cash register" of the company today. If it worked in 2024 and Parks profits were held flat then we can be 100% sure that Burbank can do it again in 2025. Burbank, you have nothing to worry about. As you were....carry on.

phillip96982 days ago

At the level where all imagineers are expected to give him their "true" feelings on any and all projects when asked? I may be way off base here but that seems like a weird expectation. Especially knowing how quickly any non-standard responses would spread online.

James Alucobond2 days ago

They spend more than ever on new stuff now. The money is being put into it even if you dislike where it's being funneled or how things are being budgeted.

Cliff2 days ago

Trust I'm a pure, 100% nobody in every way, shape and form. I'm just another common legacy fan like any other here. Yeah...what can they do, right? Even if they were not proud of what they built, they can't say it. I'm not naming names but that day I talked directly to an Imagineer that worked on Journery of Water and I asked her why they did not build it in between the Seas and Living with the Land. Journey of Water is all about water's pathways from land and water. I told her that "Journey" have joined two themes together. There is plenty of space between them and the current location could have been open for something else. She basically told me "Hmm...y'nkow, that might not have been a bad idea. Oh well, I gues it too late now". We both laughed at it. I asked another Imagineer that I won't say if Walt's statue was set to a 1:1 scale of him. He cocked his head sideways, asked another Imagineer standing next to him and neither one knew the answer but commended me for asking it. Again...the three of us just laughed. I dunno...I was told a while back by some connected friends that work for Disney that morale in Imagineering was low. About 2 months later Joe Rhode left and that was when i realized how bad it really was. I remember almost dropping my phone the moment I read that. As a legacy fan, Joe Rhode leaving hurt my heart. Uggg. Oh well. Disney had one heck of a good run there for a long time. It's nature I guess. Everything dies eventually. It's just a rule of life. The younger generation is in charge now. The parks will just move forward with different customers. Their money is just as green as the last generation's is but it won't cost Burbank as much time, energy and money to please the new kids today.

Mr. Sullivan2 days ago

Even still I don’t find it very likely that someone in that position would speak about any sort of personal grievances with a new attraction to someone who is not in house, likely because they’re aware that person would do exactly what just got done: their words would be shared with everyone online.

HauntedPirate2 days ago

I don’t think he’s just a random guest. Certainly not a Martin but not unknown to many within TDO.

phillip96982 days ago

I’m curious as to why you expected of that interaction. Your expectations were that they would voice internal gripes and disagreements with you, a random park guest? Why would they voice anything except positive opinions with you? What is entertainment to you is their job and career.

Cliff3 days ago

As far as parks are concerned, I think they are creatively dead now. Look at how the studios make all these movies that play from IP titles from the "past" GREAT creative minds at Disney. Burbank is no longer able to create ANYthning "new" today! For years now, they keep resorting back to "re-imagining" great IP from the past. 75% of the time, it all just flops! Burbank has put it's best minds into the new "Snow White" movie. They have carefully overseen it's development and poured TONS of money and enormous attention into re-writes and re-shoots and all of Brubank's best minds inspect it in order to REALLY get this one "right". Let's see how it goes next spring. Let's see how good Burbank's best people really are. Whatever they come up with?...I'm 100% certain that "modern Burbank" will be in absolute LOVE with their hard work. The same creative black hole happens in Burbank and Glendale with the parks. They can't create anything "new" and would rather lean on a crutch and just dump already known IP into parks and "hope" people connect with that attraction. This is our future with the parks. The latest Epcot build is a proud moment for Burbank. Epcot's new "World Celebration" and "Dreamers Point" are the crowning achievements of "modern Burbank" and "modern Glendale". I talked directly with three Imagineers on opening day and ALL three were absolutely beaming and glowing with pride at what they built.....and modern audiences just might agree with them completely. Burbank and Glendale have chosen sides and they clearly want the "modern" audience. Ironically, Universal seemed to be HAPPY to hire away Burbank/Glendale's "legacy" creatives. Let's see how Universal does in 2025 with ex-Disney "legacy" Imagineers. The "old-legacy" creatives that Burbank didn't want anymore.....

Chi843 days ago

So you think they’ll be fine for a long time to come. I don’t necessarily buy into everything you said but I do agree that newer fans don’t care as much about the details you mentioned.

Sirwalterraleigh3 days ago

It’s not a matter of “surviving” It’s a matter of how badly they can mess with the model to the point where some nitwit decides it’s more “advantageous” to start chopping up pieces to sell it off… Cause the day will come. Any idea that there will be a “select” group of patricians walking around dropping $25,000 a week for buffet food with chip and dale and the place will still churn the profits needed is beyond stupid. I’ve seen Disney sycophants sell themselves some bunk over the years to fill whatever void they have… …this is the dumbest concept ever. Management is transactional and they will say anything…even when it passes no sniff tests.