2019 Fiscal Q1 Disney Earnings Report

[YesterDark]

Perhaps, but they aren’t even really licensing very much. They don’t need to develop it, but they should be involved heavier than they are.

They have almost no presence in gaming.

Disney as a company has a ton of video game licensing. Star Wars, Marvel, Kingdom Hearts, ESPN etc.

 

[The Pho]

Disney as a company has a ton of video game licensing. Star Wars, Marvel, Kingdom Hearts, ESPN etc.

Which only comprise a handful of games... and even less if you only count major releases.

They used to release dozens a year when the industry was significantly smaller, now one or two major titles is a rare thing. And they have more content than ever before. There are hundreds of Star Wars games, since Disney took over there have been around 10, only 2 major ones and one of which had significant controversy surrounding it, and most of them are minor iOS releases. They are less involved now than they were pre-Iger by a long shot. It’s just not a focus of the company anymore.

 

[lugnut33]

I’m actually a bit surprised how little ESPN+ has been talked about. It’s up to over 2 million subscribers now. It is home to the UFC now which helps.

Disney+ with enough existing and new content could be more appealing to me and I’m sure other consumers than Netflix.

Is Disney+ included in a ESPN+ subscription or are they two separate buys?

 

[The Pho]

Is Disney+ included in a ESPN+ subscription or are they two separate buys?

They’re separate services but potential bundles between them and Hulu have been mentioned.

 

[lugnut33]

I think we are getting closer to that peak pricing.

I really don't think they are close at all. I believe they could easily get up to $500 per day. With the add-ons and "exclusive" ticket events it will not be long before that number is there.

 

[rteetz]

I really don't think they are close at all. I believe they could easily get up to $500 per day. With the add-ons and "exclusive" ticket events it will not be long before that number is there.

Yes but don’t you think attendance would be down at $500? Regulars will certainly be priced out at $500 a day.

 

[TheMaxRebo]

I really don't think they are close at all. I believe they could easily get up to $500 per day. With the add-ons and "exclusive" ticket events it will not be long before that number is there.

Yes but don’t you think attendance would be down at $500? Regulars will certainly be priced out at $500 a day.

@rteetz I think people are responding to your initial post meaning that you think we are getting to the maximum amount Disney could charge, but form another explanation post you had, I think you meant the maximum they can charge without negatively impacting attendance

Which I think we are getting there ... now, Disney could say "good, we want attendance down a bit and if we can double the price and attendance only goes down by 20% that is a bit win for us in total revenue" Thought I don't think they want to go that far - I think they want to push pricing as much as they can without dipping total attendance *that* much and then supplement with all the hard ticket events - so rather than going to a $500/day ticket - go to a $150/day ticket and then a $120/night supplemental hard ticket

 

[rteetz]

@rteetz I think people are responding to your initial post meaning that you think we are getting to the maximum amount Disney could charge, but form another explanation post you had, I think you meant the maximum they can charge without negatively impacting attendance

Which I think we are getting there ... now, Disney could say "good, we want attendance down a bit and if we can double the price and attendance only goes down by 20% that is a bit win for us in total revenue" Thought I don't think they want to go that far - I think they want to push pricing as much as they can without dipping total attendance *that* much and then supplement with all the hard ticket events - so rather than going to a $500/day ticket - go to a $150/day ticket and then a $120/night supplemental hard ticket

Yep exactly. They seem to want to control crowds with pricing but I doubt they want large attendance drops because that means less money elsewhere (shops, dining, etc.).

 

[TheMaxRebo]

Yep exactly. They seem to want to control crowds with pricing but I doubt they want large attendance drops because that means less money elsewhere (shops, dining, etc.).

and even just signaling to Wall St ... one thing to say attendance was flat our down 2% but total revenue was up 10%, they love that .... but if a brand says attendance was down 20%, even if total revenue was up I think that is a bad look

 

[YesterDark]

Yep exactly. They seem to want to control crowds with pricing but I doubt they want large attendance drops because that means less money elsewhere (shops, dining, etc.).

I can imagine a strategy would be to have people not do park day but do shopping days. I.e. 4 day vacation 2-3 parks days 1-2 days at Disney Springs or other resorts for dining.

If the pricing gets higher, you may see what other parks do. Half off tickets for evening admission. Or tickets with a 1.5x multiplier and you get to use it in the evening the day prior to full day of park entry.

 

[sachilles]

The thing to also consider is that by raising pricing to a certain level, weeds out a demographic that might be less likely to spend money in parks. Now if you have a limited capacity, you need to make sure the people that enter the park are spending the money when they get there. Ultimately your attendees have more value to you if they aren't brown bagging their lunch etc. The key is getting the free spending people in house.

 

[rteetz]

I can imagine a strategy would be to have people not do park day but do shopping days. I.e. 4 day vacation 2-3 parks days 1-2 days at Disney Springs or other resorts for dining.

If the pricing gets higher, you may see what other parks do. Half off tickets for evening admission. Or tickets with a 1.5x multiplier and you get to use it in the evening the day prior to full day of park entry.

I don’t see Disney doing something like that. That’s not Disney’s model. They want you in their parks all day spending money on everything. They want you looked in with Hoppers and on property.

 

[TheMaxRebo]

I don’t see Disney doing something like that. That’s not Disney’s model. They want you in their parks all day spending money on everything. They want you looked in with Hoppers and on property.

I think the key is your last point - they want you on Disney property. I think they are fine if you take some days to spend at Disney Springs or the water parks or playing golf or whatever ... from the very beginning Walt Disney World was meant to be a vacation destination with the theme park just one par of that

 

[YesterDark]

I agree, just saying it's a practice that's out there. If prices get to the point where people are not going to the parks as often during a similar duration stay, then they will either lower ticket prices back down (most likely) or give additional access to recoup money spent in dining or shops.

However, the trip I booked has 6 hoppers. The different between 5 days or 6 days for 5 people was like $40-50. That's stupid cheap. Personally I'm not worried about ticket pricing if Disney still does discounted rates for ticket packages.

 

[saskdw]

@rteetz I think people are responding to your initial post meaning that you think we are getting to the maximum amount Disney could charge, but form another explanation post you had, I think you meant the maximum they can charge without negatively impacting attendance

Which I think we are getting there ... now, Disney could say "good, we want attendance down a bit and if we can double the price and attendance only goes down by 20% that is a bit win for us in total revenue" Thought I don't think they want to go that far - I think they want to push pricing as much as they can without dipping total attendance *that* much and then supplement with all the hard ticket events - so rather than going to a $500/day ticket - go to a $150/day ticket and then a $120/night supplemental hard ticket

I think you are right. The ticket and room prices are close to being topped out, but they will increase revenue with hard ticket events. In order to sell out the hard ticket events they need huge crowds during the day so they need to walk the fine line there. If attendance decreases some people won't feel the need for a hard ticket event to avoid crowds.

I also wonder how much does the single day ticket price matter? We are always there for 12-14 days and purchase 10-day hoppers. I don't even pay attention to the single day prices. We normally get 10 day hoppers which are currently priced at $621 tax paid in December. I think this is up about $100 over 5-6 years ago. Really not that much.

I look at the overall cost of the vacation not just one thing. Room, tickets, food, etc. The rack rate increases them selves aren't that crazy, but now that they are slowly dialing back the discounts it is adding up. The biggest expense for us right now is the extra $.35 per dollar being from Canada, which isn't Disney's fault.

 

[saskdw]

I agree, just saying it's a practice that's out there. If prices get to the point where people are not going to the parks as often during a similar duration stay, then they will either lower ticket prices back down (most likely) or give additional access to recoup money spent in dining or shops.

However, the trip I booked has 6 hoppers. The different between 5 days or 6 days for 5 people was like $40-50. That's stupid cheap. Personally I'm not worried about ticket pricing if Disney still does discounted rates for ticket packages.

We always have 10 day tickets. So I agree. I don't care if they front load the ticket price as long as the 10 day tickets are heavily discounted.

 

[TheMaxRebo]

I agree, just saying it's a practice that's out there. If prices get to the point where people are not going to the parks as often during a similar duration stay, then they will either lower ticket prices back down (most likely) or give additional access to recoup money spent in dining or shops.

However, the trip I booked has 6 hoppers. The different between 5 days or 6 days for 5 people was like $40-50. That's stupid cheap. Personally I'm not worried about ticket pricing if Disney still does discounted rates for ticket packages.

I think for most people a typical vacation is a week, so if they can keep you at Disney for that entire week vs doing 3-4 days at Disney a 3-4 days at Universal (or whatever) Disney wants that - so I think that is why the price increase for additional days after like 5 is so small (relatively speaking)

 

[TheMaxRebo]

I think you are right. The ticket and room prices are close to being topped out, but they will increase revenue with hard ticket events. In order to sell out the hard ticket events they need huge crowds during the day so they need to walk the fine line there. If attendance decreases some people won't feel the need for a hard ticket event to avoid crowds.

I also wonder how much does the single day ticket price matter? We are always there for 12-14 days and purchase 10-day hoppers. I don't even pay attention to the single day prices. We normally get 10 day hoppers which are currently priced at $621 tax paid in December. I think this is up about $100 over 5-6 years ago. Really not that much.

I look at the overall cost of the vacation not just one thing. Room, tickets, food, etc. The rack rate increases them selves aren't that crazy, but now that they are slowly dialing back the discounts it is adding up. The biggest expense for us right now is the extra $.35 per dollar being from Canada, which isn't Disney's fault.

I always think that but then am surprised by the amount of people that just go for one day while they are in Florida or something - so while the % of DISers that go for one day is, I would guess, very low - out of everyone that goes I suspect is it much higher than we might think.

Obviously anecdotal but I just saw a post in a Facebook group saying "We will be going to magic kingdom only & for one day. My kids are 5&6. Must do's and must eats?"

 

[Iowamomof4]

I always think that but then am surprised by the amount of people that just go for one day while they are in Florida or something - so while the % of DISers that go for one day is, I would guess, very low - out of everyone that goes I suspect is it much higher than we might think.

Obviously anecdotal but I just saw a post in a Facebook group saying "We will be going to magic kingdom only & for one day. My kids are 5&6. Must do's and must eats?"

I see those same posts in Facebook groups. Over, and over, and over. I'm always amazed people can just "add on" a day at Disney as part of a bigger Florida trip. The hardest question to answer that I see from people is, "We'll have 2 (or 3) park days, which parks should we go to?" Ugh! It's just so hard to know how to advise someone when they ask a question like that.

 

[saskdw]

I always think that but then am surprised by the amount of people that just go for one day while they are in Florida or something - so while the % of DISers that go for one day is, I would guess, very low - out of everyone that goes I suspect is it much higher than we might think.

Obviously anecdotal but I just saw a post in a Facebook group saying "We will be going to magic kingdom only & for one day. My kids are 5&6. Must do's and must eats?"

It would be interesting to know what the single day numbers are or even the 2-3 day numbers.

My guess is Disney doesn't care. They are clearly saying if you go for one day you will pay through the nose.