Walt Disney (DIS) lost billion in revenue at its theme parks during the pandemic. The company faced closures around the world and closed theme parks still cost money to operate, especially when the company hoped to be able to return to operation quickly once the pandemic's impact lessened.
It was a bleak time where the "happiest place on Earth," a self-given nickname for California's Disneyland, became one of the saddest. There were no people lining up for rides, snapping photos or happily paying for pricey meals and snacks.
After a year when far too many Americans didn't get to hug Mickey Mouse or complain that the Rock 'n' Roller Coaster is just way too intense, Disney's theme parks have rebounded to record attendance last year, COVID-19 variants be damned. While some fans complained about price increases, plenty of people were apparently willing to pay extra, as they'd waited too long to return to wait in any more lines.
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How Well Did Disney's Theme Parks Do?
Disney’s domestic parks (which is to say, the ones based in North America such as California’s Disneyland and Florida’s Walt Disney World) closed for a while in 2020 as COVID-19 hit and then reopened later in the year with strict capacity restrictions and other safety protocols, including mask mandates.
The public was understandably skittish about going to a theme park, but attendance rebounded as vaccines became available and restrictions loosened. Disney Parks, Experiences and Products generated a $356 million profit in the quarter ending July 3 of last year, “compared with a $1.87 billion loss in the same period in 2020.”
That was a major turnaround, but it was only the beginning.
Even with the emergence of new COVID-19 variants, attendance continued to climb as the year went on, as revenues for the final quarter of 2021 increased to $7.2 billion compared to $3.6 billion in the prior-year quarter, as noted in Disney’s latest earnings report. All in all, the increase in parks attendance accounted for a third of Disney’s $22 billion in total sales.
Most importantly, the theme park segment swung to a $2.45 billion profit, up from a $119 million loss in the year-ago period. This isn't the first profit for the division since the pandemic, but it's a decided return to pre-Covid returns.
“In fiscal 2022, our domestic parks and experiences are generally operating without significant mandatory COVID-19-related capacity restrictions, such as those that were in place in the prior-year quarter; however, we continue to manage capacity to address ongoing COVID-19 considerations with respect to guest and cast health and safety,” noted Disney in the call.
In the sales call, CEO Bob Chapek pointed to a pent-up “demand” as the reason for the sales surge (plenty of people just want life to go back to normal, after all) as well as a recent rise in ticket prices (with more to come on the way) and increased guests option for more expensive ticket options such as Disney Genie and Disney Genie+ as well as Lightning Lane.
What Are Disney Genie+ And Lightning Lane?
The cost of a regular, or Tier 1, ticket to one of Disney’s parks hasn’t changed, as $104 will get you into one park for one day, which means you can attend Disney World but you can’t take the Monorail over to Epcot, for example.
But prices for Tiers 2 through 6, went up to $119, $134, $149, $159 and $164. Tiers become more expensive depending on how popular a time it is to visit. So if you want to go on Tier 4 day, you need a Tier 4 ticket, which also gets you into a Tier 3 day and so on.
In addition to the various Tiers, Disney Genie, Disney Genie+, and Lightning Lane are all add-ons guests can purchase that allow them to navigate the park easier and cut down on their wait time.
Disney Genie, which is free, is an app that will help guests build an itinerary for the day. Disney Genie+ is $20 per-a-person, per-a-day add-on, and it lets guests reserve arrival times to avoid the regular standby line on certain popular rides, but not all rides. Think of it as the modern equivalent to the park’s old FASTPASS system.
Lightning Lane is a $20 per-a-person-per-a-day Genie+ add-on. It's an even faster service, and it applies only to the most popular rides in each park, such as Star Wars: Rise of the Resistance in Disneyland, WEB SLINGERS: A Spider-Man Adventure, and Radiator Springs Racers in Disney California Adventure.
A third to half of the park goers are opting to upgrade to Genie+, which Chapek says is “which is way above what we expected.”
While things are looking up for Disney’s America theme parks, the company is still encountering challenges and headaches across the world.
Hong Kong Disneyland recently closed again after a resurgence of the virus, while attractions such as Tokyo Disneyland and Disneyland Paris, are continuing to deal with COVID-19 related capacity and travel restrictions, as those two countries have some of the strictest COVID-19 protocols in the world.
