As expected, the Walt Disney Company reported an extreme drop in revenue in its theme park division for the quarter between April and June — a period when almost all its parks were closed around the world.
Revenue in the Parks, Experiences, and Products segment, which includes Disney parks, Disney Cruise Line and Disney retail, fell to just $983 million in the company’s third quarter. This represents a 85 percent drop from the same quarter in 2019.
With only Shanghai Disneyland open for any portion of the quarter, Disney estimated that the COVID-19 pandemic cost this division $3.5 billion in lost income between April and June.
“We have prioritized the health and safety of our cast members and guests and have instituted protocols that include a mandatory mass policy temperature screening, increased cleaning and disinfecting, as well as capacity restrictions to promote social distancing,” said Disney CEO Bob Chapek. “We continue to work with national and local health and government officials in this very fluid situation and are making adjustments as necessary.
Two theme park resorts remain closed: Disneyland Resort in Anaheim, California, and Hong Kong Disneyland, which reclosed in July after less than a month of operation due to local spike in coronavirus cases.
Disneyland Paris and Disney World reopened in July. While Disney said the Disney World reopening has made a “net positive contribution” to the company, it was not to the degree expected, because of the surge in COVID-19 cases in Florida.
“This gave some level of trepidation to travelers who are anxious about long-distance travel jumping on a plane and flying to Walt Disney World,” Chapek said. “What we’ve seen is that we have roughly 50 percent of our guest base still traveling from a distance, but the other 50 percent coming from local markets in-state. We’ve also had a higher than expected level of cancellations when somebody does make a reservation, because as the disease ebbs and flows, they might necessarily cancel.”
Both Chapek and Disney chief financial officer Christine McCarthy said that they expect demand for Disney World to pick up — once consumer confidence is restored and the COVID-19 situation in Florida has improved.
On Aug. 4, Central Florida surpassed 1,000 deaths due to COVID-19, with 241 of those fatalities occurring in Orange County.
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