Disney is hurting for cash

[Oldnewfan]

Very interesting.

Had to laugh a little at the "not since WWII has uncertainty been so high" quote, though. Considering the theme parks were not even starting to be built until the 1950s?

Disney the company... not the Parks. Things were very uncertain after the war since Disney was dedicated to the effort and nothing much in the pipeline. Just to be fair. Not defensive.

 

[Drfate102]

Understood but I expect that the opposite is true, with no movie or tv studio production, virtually no park construction, and 20 years of projects still depreciating and amortizing. What would they have been spending money on besides salaries?

There is still some construction work, the removal of the steel and seeding at Reflections, maintenance over the property along with work that is in post production. Legal, I’m sure, has been working along with other consultants. Cruise Line cost of ports fees and supplies along with fuel. We know finance was working on the loans to bolster their cash needs. And with all of that, the massively reduced revenue streams.

 

[mamaofsix]

Disney the company... not the Parks. Things were very uncertain after the war since Disney was dedicated to the effort and nothing much in the pipeline. Just to be fair. Not defensive.

True!

 

[Mom24Princesses]

Very interesting.

Had to laugh a little at the "not since WWII has uncertainty been so high" quote, though. Considering the theme parks were not even starting to be built until the 1950s?

Well.....Walt Disney made Treasure Island - in the UK because they would not let him take profits back to the US after WWII. They didn’t have animators or animation studios in UK so they made the first live action movie spending the money in the UK

 

[Jrb1979]

This was posted by Touchdown on WDWmagic. I tend to agree with him on it. Especially about re riding attractions.


I continue to believe opening now is a mistake for a multitude of reasons. I’m not going to go over the health risks again but instead focus on the brand.

Disney Parks, and specifically WDW is seen as the pinnacle of the theme park experience in the US. They’ve made that reputation over years, but have always done so by not chasing the regional parks focus on high thrilling rides but instead focusing on experiences. That has come as a detriment to their ride re-ridability because story driven rides don’t change much (or at all) from ride to ride.

The general public, if allowed to, will re ride their favorite coasters 3+ times throughout the day (and us rare few coaster enthusiasts will go multiples over that) without getting bored because the forces are always thrilling and never get old even if you know exactly where they happen. That’s why the only rides I’ve rerodden >3 times in a row at a Disney Park are all thrill rides or interactive rides (which challenge riders to improve their score) like BTMRR, Splash, ToT, TSMM, Sreamin, RSR, etc. Don’t get me wrong I love POTC and HM but if you asked me to stay on them for an hour I would go a little loopy and get bored with them. It’s like being asked to watch your favorite movie multiple times back to back, only 5 year olds do that the rest of us find it tiring and it ends up reducing our enjoyment of said movie.

What’s always set Disney above the rest has been the shows, characters, dining and evening spectaculars. There is no other park that offers up what Disney does, that is what wows the general public. Opening like this is causing Disney to operate like a regional park where they have to rely exclusively on the strength and re-ridability of their rides; let’s face it other then MK every other park has >20 experiences currently assuming it takes you 20 minutes per ride that’s 3 rides per hour and you’ll have done the park in 5-6 hours, let’s say you re ride you favorite 4 that still puts you at 6-8 hours. Do you really think Disney with its exorbitantly high price tag is going to get a favorable review from the GP currently when compared to their regional park?

There is a reason fans like me are staying away that goes beyond health issues, and any once in a lifetime visitors that do come I think are going to be horribly disappointed. Disney has lowered itself to its competitors level, by cutting out the things that make it special.

Here’s where I’m supposed to put in the happy end where these times may actually make execs realize how important those expensive entertainment offerings are to the park but I’m not hopeful, not with who is CEO now and pressure to keep costs down. Disney hasn’t hit rock bottom yet, and I hope the parks survive the fall.

 

[TommyJK]

This was posted by Touchdown on WDWmagic. I tend to agree with him on it. Especially about re riding attractions.


I continue to believe opening now is a mistake for a multitude of reasons. I’m not going to go over the health risks again but instead focus on the brand.

Disney Parks, and specifically WDW is seen as the pinnacle of the theme park experience in the US. They’ve made that reputation over years, but have always done so by not chasing the regional parks focus on high thrilling rides but instead focusing on experiences. That has come as a detriment to their ride re-ridability because story driven rides don’t change much (or at all) from ride to ride.

The general public, if allowed to, will re ride their favorite coasters 3+ times throughout the day (and us rare few coaster enthusiasts will go multiples over that) without getting bored because the forces are always thrilling and never get old even if you know exactly where they happen. That’s why the only rides I’ve rerodden >3 times in a row at a Disney Park are all thrill rides or interactive rides (which challenge riders to improve their score) like BTMRR, Splash, ToT, TSMM, Sreamin, RSR, etc. Don’t get me wrong I love POTC and HM but if you asked me to stay on them for an hour I would go a little loopy and get bored with them. It’s like being asked to watch your favorite movie multiple times back to back, only 5 year olds do that the rest of us find it tiring and it ends up reducing our enjoyment of said movie.

What’s always set Disney above the rest has been the shows, characters, dining and evening spectaculars. There is no other park that offers up what Disney does, that is what wows the general public. Opening like this is causing Disney to operate like a regional park where they have to rely exclusively on the strength and re-ridability of their rides; let’s face it other then MK every other park has >20 experiences currently assuming it takes you 20 minutes per ride that’s 3 rides per hour and you’ll have done the park in 5-6 hours, let’s say you re ride you favorite 4 that still puts you at 6-8 hours. Do you really think Disney with its exorbitantly high price tag is going to get a favorable review from the GP currently when compared to their regional park?

There is a reason fans like me are staying away that goes beyond health issues, and any once in a lifetime visitors that do come I think are going to be horribly disappointed. Disney has lowered itself to its competitors level, by cutting out the things that make it special.

Here’s where I’m supposed to put in the happy end where these times may actually make execs realize how important those expensive entertainment offerings are to the park but I’m not hopeful, not with who is CEO now and pressure to keep costs down. Disney hasn’t hit rock bottom yet, and I hope the parks survive the fall.

I somewhat disagree with the assessment and it comes down to this portion:

"any once in a lifetime visitors that do come I think are going to be horribly disappointed."

I don't think very many (if any at all) "once in a lifetime" visitors are going to be trying to visit right now. For these visitors, it's a relatively expensive trip that involves a lot of saving, planning, organizing etc.. Many of those are not willing to drop that kind of money right now with everything that's going on. Many of those types of visitors are from out of country that can't even try to visit right now.

I'm guessing that the vast majority of visitors over the rest of the year are those who are already massive Disney fans who have been before and "need" to visit despite sharp increasing spread of the virus right on Disney's doorstep.

 

[Jrb1979]

This was posted by Touchdown on WDWmagic. I tend to agree with him on it. Especially about re riding attractions.


I continue to believe opening now is a mistake for a multitude of reasons. I’m not going to go over the health risks again but instead focus on the brand.

Disney Parks, and specifically WDW is seen as the pinnacle of the theme park experience in the US. They’ve made that reputation over years, but have always done so by not chasing the regional parks focus on high thrilling rides but instead focusing on experiences. That has come as a detriment to their ride re-ridability because story driven rides don’t change much (or at all) from ride to ride.

The general public, if allowed to, will re ride their favorite coasters 3+ times throughout the day (and us rare few coaster enthusiasts will go multiples over that) without getting bored because the forces are always thrilling and never get old even if you know exactly where they happen. That’s why the only rides I’ve rerodden >3 times in a row at a Disney Park are all thrill rides or interactive rides (which challenge riders to improve their score) like BTMRR, Splash, ToT, TSMM, Sreamin, RSR, etc. Don’t get me wrong I love POTC and HM but if you asked me to stay on them for an hour I would go a little loopy and get bored with them. It’s like being asked to watch your favorite movie multiple times back to back, only 5 year olds do that the rest of us find it tiring and it ends up reducing our enjoyment of said movie.

What’s always set Disney above the rest has been the shows, characters, dining and evening spectaculars. There is no other park that offers up what Disney does, that is what wows the general public. Opening like this is causing Disney to operate like a regional park where they have to rely exclusively on the strength and re-ridability of their rides; let’s face it other then MK every other park has >20 experiences currently assuming it takes you 20 minutes per ride that’s 3 rides per hour and you’ll have done the park in 5-6 hours, let’s say you re ride you favorite 4 that still puts you at 6-8 hours. Do you really think Disney with its exorbitantly high price tag is going to get a favorable review from the GP currently when compared to their regional park?

There is a reason fans like me are staying away that goes beyond health issues, and any once in a lifetime visitors that do come I think are going to be horribly disappointed. Disney has lowered itself to its competitors level, by cutting out the things that make it special.

Here’s where I’m supposed to put in the happy end where these times may actually make execs realize how important those expensive entertainment offerings are to the park but I’m not hopeful, not with who is CEO now and pressure to keep costs down. Disney hasn’t hit rock bottom yet, and I hope the parks survive the fall.

@Mit88 what's so funny about that. I know you're a big Disney fan so you doubt anything is wrong I don't think Disney will fail but don't expect all the things planned to happen as planned. Yes the hardcore Disney fans will always show up but most GP won't see it being worth the Disney price for not the Disney experience.

 

[Indy #1 Fan]

I can absolutely see Splash Mountain staying due to budget cuts. With new cases rising in Florida and considering we're technically still in the first wave, I can see WDW closing again and DL not opening until some point in 2021. I'll go out a limb and say when WDW celebrates its 75th anniversary Splash Mountain will still be there and same for DL. Yes, I'm that optimistic.

 

[Marthasor]

Right now, I'm assuming, WDW has a very high proportion of drive-in state and local guests. When fall comes along and many kids go back to school, that guest count is going to further nose dive (IMHO). Until FL gets its numbers under control and domestic and international travel restrictions are lifted, I'm not seeing a very rosy picture here. I'm the first to admit that I know nothing about theme park operations, but I don't know how long you can operate without turning a profit. I just went into the park reservation system and every day I checked is wide open to make a reservation, so, even with lowered capacity and the opening of 2020 ticket sales, they don't seem to have much demand. I really don't see how they are generating enough revenue in the parks to justify operating?! Chapek himself said they wouldn't open parks unless they knew it would be profitable. Quite honestly, I'm more interested in seeing the Q4 numbers, because, I think those will better reflect what happens financially in WDW from July - Sept.

 

[RivShore]

It does not take a genius to figure Disney is hurting for money. My biggest beef is anyone who says Disney has not invested in the Park. Lets just talk WDW. Starting with the Magic Band tehnology which cost over 2 Billion, than there was the Magic Kingdom Fantasy land makeover another half a billion, followed by Avator at 1 billion, Toy story land at half a billion, Star Wars at over 1 billion. And what about the cost of the total makeover of Disney Springs? Not even mentioning the ongoing Tron, Guardians of Galaxy rides or the total make over going on at EPCOT. These are just the ones off the top of my head, I am sure if I did some research I would come up with more. Please no more bogus claims that Disney does not invest in the Parks.

Yep, so many just say over and over that the Bob's cheap out on the parks when, in reality, they have put more investments in them than any prior regime.

 

[BorderTenny]

Right now, I'm assuming, WDW has a very high proportion of drive-in state and local guests. When fall comes along and many kids go back to school, that guest count is going to further nose dive (IMHO). Until FL gets its numbers under control and domestic and international travel restrictions are lifted, I'm not seeing a very rosy picture here. I'm the first to admit that I know nothing about theme park operations, but I don't know how long you can operate without turning a profit. I just went into the park reservation system and every day I checked is wide open to make a reservation, so, even with lowered capacity and the opening of 2020 ticket sales, they don't seem to have much demand. I really don't see how they are generating enough revenue in the parks to justify operating?! Chapek himself said they wouldn't open parks unless they knew it would be profitable. Quite honestly, I'm more interested in seeing the Q4 numbers, because, I think those will better reflect what happens financially in WDW from July - Sept.

Chapek didn't say "profitable", he said "positive contribution", which means income is more than the additional costs of opening the parks vs. staying closed.

 

[Mit88]

@Mit88 what's so funny about that. I know you're a big Disney fan so you doubt anything is wrong I don't think Disney will fail but don't expect all the things planned to happen as planned. Yes the hardcore Disney fans will always show up but most GP won't see it being worth the Disney price for not the Disney experience.

What I find funny is that you, an Anti-Disney person, spends so much time on not one, but two different disney forums, and are active on both. More power to you to for having the endurance to put yourself through all of that. I know if I disliked something as much as you do Disney, I wouldnt be able to talk about that something I dislike as much as you do for Disney.

Maybe I can put this in terms that you’ll understand. I’m a NY Ranger fan (playing the role of Disney). I also love Hockey (playing the role of Theme parks in general). I dont go on to NJ Devil’s or Pittsburgh Penguins forums and tell them that their teams suck and how the Rangers operate their franchise better. First of all, that sounds exhausting. Second of all, its false as the Rangers havent won a cup in 26 years while the other 2 have won cups in the last decade

And I also find it funny that you cant even form your own opinion or conjecture on the topic at hand, all you did was copy and paste. Not only copy and paste, but copy and paste from a member of another forum that isnt known for reliability.

Do yourself a favor, think for yourself sometimes. Its good for the mind. Have your own opinions. Don’t depend on others to make your opinion for you. You hate Disney, thats your opinion, and you’re entitled to that. WDWPro didnt help you form that opinion, so why do you need his/her opinion on why Disney has cash problems? Create your own narrative, even if its false and/or baseless. Be you, JRB. You’re better than this

 

[marinejjh]

Seriously, Disney has been sticking it to people for years to make a huge profit. I personally dont care if they lose billions. It wont affect me as most businesses that lose that kind of money either adjust prices or go bankrupt.

 

[Jrb1979]

What I find funny is that you, an Anti-Disney person, spends so much time on not one, but two different disney forums, and are active on both. More power to you to for having the endurance to put yourself through all of that. I know if I disliked something as much as you do Disney, I wouldnt be able to talk about that something I dislike as much as you do for Disney.

Maybe I can put this in terms that you’ll understand. I’m a NY Ranger fan (playing the role of Disney). I also love Hockey (playing the role of Theme parks in general). I dont go on to NJ Devil’s or Pittsburgh Penguins forums and tell them that their teams suck and how the Rangers operate their franchise better. First of all, that sounds exhausting. Second of all, its false as the Rangers havent won a cup in 26 years while the other 2 have won cups in the last decade

And I also find it funny that you cant even form your own opinion or conjecture on the topic at hand, all you did was copy and paste. Not only copy and paste, but copy and paste from a member of another forum that isnt known for reliability.

Do yourself a favor, think for yourself sometimes. Its good for the mind. Have your own opinions. Don’t depend on others to make your opinion for you. You hate Disney, thats your opinion, and you’re entitled to that. WDWPro didnt help you form that opinion, so why do you need his/her opinion on why Disney has cash problems? Create your own narrative, even if its false and/or baseless. Be you, JRB. You’re better than this

I'm not anti-Disney and I don't hate them either. I'm just enamoured with them like most on this board. I do want to take my little to the park eventually when she's a bit older. What WDWpro is not an opinion of his, its things he has heard. I don't see the issue with letting others hear about things that could be delayed or cancelled. Its not always roses and sunshine at Disney.

I do have my own opinion of Disney and I have shared it here. I like some of the attractions and how themed they are. I love roller coasters and think Disney has good themed ones. I just wish they wouldn't try to hide the track all the time. I look at the new Jurrasic Park coaster being built and I love seeing parks with coasters in the skyline. I'm not a fan of all the IP taking over the parks. My only 2 things I hate about Disney is the planning that's involved and the FP system. When I go to all other parks there is no planning involved and love the paid system other parks use. I don't have pick a time when I want to ride something.

 

[Mit88]

I'm not anti-Disney and I don't hate them either. I'm just enamoured with them like most on this board. I do want to take my little to the park eventually when she's a bit older. What WDWpro is not an opinion of his, its things he has heard. I don't see the issue with letting others hear about things that could be delayed or cancelled. Its not always roses and sunshine at Disney.

I do have my own opinion of Disney and I have shared it here. I like some of the attractions and how themed they are. I love roller coasters and think Disney has good themed ones. I just wish they wouldn't try to hide the track all the time. I look at the new Jurrasic Park coaster being built and I love seeing parks with coasters in the skyline. I'm not a fan of all the IP taking over the parks. My only 2 things I hate about Disney is the planning that's involved and the FP system. When I go to all other parks there is no planning involved and love the paid system other parks use. I don't have pick a time when I want to ride something.

I’ve never seen you post a single thing positive about Disney, on a Disney forum board. Its ok that you’re Anti-Disney. You dont have to hide it. I know plenty of people that dislike Disney, including family members. I just find it weird that you frequent Disney based forums to come in and talk smack about them. People that arent Anti something typically have something nice to say about that thing every once in a while.

There are mod’s and valued members of this board who in this very thread basically scoff at the notion that WDWPro “knows” anything regarding these issues or whats happening for the 50th. Some of the obvious stuff like Disney is losing money...well no s___, they were just closed for over 100 days. If I told you personally to take $20 out of your wallet every day for 117 days, I’m sure you wouldnt be happy if you’re able to make it all the way through the entire 117 days. The entertainment and theme park industry AS A WHOLE is losing money hand over fist, not just Disney, not just Universal. So to say you have insider information that Disney as a money problem when basically their entire company was halted for almost 100 days, again I’ll say No S____.


The paid system is great and all, but it’s not cheap. I got express pass for myself and girlfriend for HHN 2 years ago. Between that and the tickets to get in it was over $500. It was nice to be able to cut the entire Stranger Things line and go right to the front, but was it worth it? Nope. I gladly waited in the lines last year for $360 less.



1. Epcot changes are likely to be MUCH less than originally planned.

No duh. Doesnt take a rocket scientist or an insider to have known this

2. Layoffs are coming.

Layoffs are happening everywhere, why would Disney be immune from that?

3. Announced additions are on very long timelines.

What announced additions? Tron, Guardians, and Ratatouille are delayed because of the closure, but I would far from call that “long timelines” What about Splash? Disney was proactive announced that earlier than they planned. It was likely a D23 2021 announcement. Which means it wouldnt have been changed over until at the earliest, 2022. Everything non-Epcot and Reflections are moving forward as scheduled. A project like EPCOT was too big in scale to begin with to not have been sized down at least a little. Even before the shutdown people were skeptical the Festival tower wouldn’t make the final cut. But again, those arent “very long timelines”


4. Disney World having to close again would be devastating.

Anything closing again would be devastating. Closing in the first place was devastating, not to just Disney

5. OLC and Disney relations are strained; expect that to manifest in visible ways.

These types of issues with foreign/domestic relationships are often strenuous for businesses, they often tend to work themselves out

6. Every penny counts, and cost cutting measures can be expected within 12 months.

What cost cutting measures? EPCOT? Again, duh.

7?. Is Chapek the fall guy? Many are speculating Iger plans to use him as the scapegoat.

This one is really funny to me. I already laughed at the diatribe prior to this, but I absolutely lost it in laughter when I got to this

8. 50th celebration is essentially canceled down to only things that cost little... no new floats, no big refurbs.

You dont just “cancel” a 50th celebration. Next October doesnt suddenly skip a year to October 2022. Time moves forward, WDW still turns 50 next year, just as we all individually age a year regardless of this pause on life. Oh no, please dont take away the new floats that were never rumored anyway. What ever will we do without those....

What “big refurb” would have been able to occur between now and next Summer? “Big refurbs” take time, and theres not much time before the 50th anniversary. So I call BS completely on that take

People will be just fine getting to go to the parks for the Anniversary year, buy the merch, and ride the new rides. Some might be upset that Disney wont have all the bells and whistles that they originally had planned, but how can you be upset about something that you had NO idea about in the first place?


In other words, your friend WDWPro decided to write ALL of that out to say nothing. Nothing thats at all been rumored. Nothing of merit. Nothing of substance. Just a post to keep relevant and seem like he knows more than he lets on.

 

[jerry557]

For those thinking Disney won't skip a beat are sadly mistaken. There is no question this hurts the company.

The issue is not really about immediate cash though, it's more long term. Disney's revenues are going to take a massive hit for perhaps years to come. That's going to have a compounding effect on the accounting sheet for a very long time. So literally everything is going to have to be re-evaluated for financial feasibility. Attendance is going to be reduced for a long time. And it will very difficult to continue the current trend of ticket price increases. I doubt they reduce prices, but if they are going to jack rates up next year like they've been doing, tons of people are going to cancel their AP's. The value won't be there.

We also don't know the full fall-out to the economy as a whole. If unemployment becomes a long term problem, or if COVID-19 continues to spread for years until we get a vaccine, people won't travel. International travel may be restricted for a long time. And Disney does get a LOT of international guests. So that's going to hurt. The Cruise Line is still non-operational. And two new ships are sitting half-done. Hollywood isn't making any movies right now either. So the movie side of the company is going to have a lull for awhile. All this stuff adds up. And it's easy to see billions of dollars in losses.

And I agree with certain parts of this that there are likely internal struggles. The Splash Mountain thing seemed very hastily put together. They just recently refurbished that ride. To suggest the "Princess and the Frog" re-theme has been in the works for "years" and the PR release has nothing to do with the current events or the circulating petition is a total complete lie. I mean come on....let's be real here. That was knee-jerk PR reaction. And I imagine it would cause some internal ruckus considering other areas of the budget are being cut. Do you want people to lose their jobs because they needed the money to re-theme Splash Mountain? The theme wasn't a big enough problem to change it in the last refurbishment (when money was plentiful). But suddenly it's a problem now that it needs immediate attention? Not only that, but now Hall of Presidents?

 

[wdwoutsider]

There is no question that Disney has a cash flow problem. That's not being negative against Disney. They are not going under, but will have to watch cash for a while.

They got a large cash infusion from bonds issued but I think August 4th will show they are burning cash faster then they want to admit. The parks and even more the film industry is hurting. Disney spent too much on acquisitions. Watch most projects have corners cut or postponed indefinitely. Some they have to finish as contracts were signed. Watch every division of Disney to have massive cuts coming.

Disney plus subscriptions have exceeded all estimates but Disney plus costs have also heavily exceeded all estimates. People are very thirsty for fresh content during this pandemic and Disney has been forced to spend alot more for content. It's still 3-5 years iirc to a break even to cover it's own developement costs so Disney plus isn't enough to help Disneys cash flow issues.

 

[PaulaSB12]

For a start of they need to rethink their films instead of making films that don't make money start making films people want

 

[CastAStone]

For a start of they need to rethink their films instead of making films that don't make money start making films people want

Um...

 

[anthony2k7]

Chapek didn't say "profitable", he said "positive contribution", which means income is more than the additional costs of opening the parks vs. staying closed.

Looking at a lot of the photos from AK yesterday I'd be surprised if they achieved positive contribution yesterday, on opening day.

What's that gonna be like in a week when the vloggers and die hard fans have had their fix?

I still wouldn't be surprised if they temporarily re-shut AK and maybe Epcot due to lack of guests.

Thats assuming they don't just shut everything down again due to the covid rates.