Disney Parks Lose Over $1B as Disney+ Reports Significant Earnings
Courtesy of movieweb.com:
Disney Parks reported a loss of $1.1 billion for the 2020 fiscal year. This is the Walt Disney Company’s first annual loss in more than 40 years. However, there are some bright spots, which includes Disney+ reporting significant earnings that outpaced financial expert estimates from earlier this year. As it stands, Disneyland in California is still closed, as the international parks go on to shut down again. Walt Disney World in Florida has been open since July, though attendance has not been what they were anticipated. Florida does not have any intention of shutting the park down again.
Financial analysists also believed that Disney Parks was going to lose a lot more money, so the loss isn’t as bad as what even Disney was expecting. Disney CEO Bob Chapek called out California during the 4th quarter earnings call with investors this afternoon for keeping Disneyland closed, calling the decision “arbitrary.” Disney has been fighting with California Governor Gavin Newsom for months now in a battle to reopen the park.
Disney+ turned out to be a big winner for Disney in Q4. “The real bright spot has been our direct-to-consumer business, which is key to the future of our company, and on this anniversary of the launch of Disney+ we’re pleased to report that, as of the end of the fourth quarter, the service had more than 73 million paid subscribers – far surpassing our expectations in just its first year,” Chapek said in Thursday’s announcement. The new subscriber amount is substantially more when compared to the 57.5 million three months ago. The initial earnings call caused Disney stock to dip, but it has since rebounded, thanks to the better than expected numbers.
The public health crisis has taken its toll since it started spreading all over the world earlier this year. “It’s been a year unlike any other in our lifetimes, and certainly in the history of the Walt Disney Co.,” Bob Chapek said in the conference call today. With that being said, Chapek is hoping to have Disneyland open soon and is confident that Walt Disney World’s latest change to 35% capacity will drive more visitors this holiday season. However, he did say that he does not expect the Disney Cruise Lines to be up and running again until at least 2022.
Walt Disney World and Shanghai Disneyland were able to reopen in Q4 and did operate at a “net positive contribution” for the quarter. Even while adjusting to the new normal, Disney was able to turn some profit from those two parks. However, with cases spiking at record numbers, it doesn’t look like Disneyland will be opening its doors again anytime soon. At the earliest, estimations have been for at some point next year. Regardless, Disney Parks are keeping optimistic, along with the entirety of the Walt Disney Company. The Q4 earnings for Disney were first reported by Business Wire.
