How come DCL isn't selling out?

[nancipants]

Seriously as an adult what is there to explore on a Disney cruise line during the day when it comes to restaurants? pizza and chicken tenders?

Yes, lol.

 

[RivShore]

We just sailed virgin at the beginning of the month. I can definitely see why they knocked Disney off the number one spot. my only concern is that prices on virgin are going to climb now that people are getting wind of them. And the relatively neuter in the market so I hope they don’t change their concept because whatever they put together. Sure the heck is working.

Can you give us some highlights of your Virgin cruise? Thanks!

 

[bakerworld]

Last year we booked onto a DCL Fantasy cruise 7 weeks from sail date for the same $ as the BIL we were surprising. We booked VGT and they had a mid-ship veranda. I was very surprised we were able to book any cabin 7 weeks out. DH thought the cost should be less but I think we actually saved a couple $ on Family sized large veranda.

 

[tink1970]

Seriously as an adult what is there to explore on a Disney cruise line during the day when it comes to restaurants? pizza and chicken tenders?

Ouch! I will say as someone who has really basic (think 5 year old) tastes and doesn't eat meat that the Wish does a great job for me on the pool deck-the mac and cheese at Mickey's BBQ is pretty tasty as are the veggie tacos/burritos at Donald's Cantina and the occasional gelato at Inside Out. Then, ofc there's Palo at night. But to each his/her own...

 

[mousefan73]

Can you give us some highlights of your Virgin cruise? Thanks!

I honestly dont know where to start. Food options amazing. They don’t have a MDR but all inclusive dining. the food is amazing!!! this was the snack menu with service at my fav lounge with free steak skewers.

No announcements, no addtl tipping, no annoying trying to sell or ship photographer in your face. FREE popcorn, great areas to chill everywhere. Free softdrinks. Normal price drinks again no tipping. Great entertaiment. Food and food again .

 

[brentm77]

It sure doesn't feel like we are seeing the predicted travel slowdown. TSA just hit another record day and expects this year's July 4th period to be 5.4% higher than last year's period.

https://finance.yahoo.com/news/us-screens-record-setting-2-223639665.html

 

[Lucien Franciosa]

It sure doesn't feel like we are seeing the predicted travel slowdown. TSA just hit another record day and expects this year's July 4th period to be 5.4% higher than last year's period.

https://finance.yahoo.com/news/us-screens-record-setting-2-223639665.html

there is travel, and then there is REVENGE TRAVEL lol. these stats are about people getting on planes, they could have been going to visit the family now that they have gotten the REVENGE TRAVEL out of their systems (vacation at resorts, parks, cruises). Most predicted declines I had heard about was the REVENGE TRAVEL.

 

[DCLMP]

People are still traveling. I wouldn't read to much into it, and means nothing as far as the future is concerned.

 

[brentm77]

there is travel, and then there is REVENGE TRAVEL lol. these stats are about people getting on planes, they could have been going to visit the family now that they have gotten the REVENGE TRAVEL out of their systems (vacation at resorts, parks, cruises). Most predicted declines I had heard about was the REVENGE TRAVEL.

I don't buy it. If you took away a big chunk of tourist travel, it's hardly likely that family visits are making up for the drop, plus adding enough to cause record high airlines travel (higher than even previous Thanksgiving or Christmas travel, in June!). Some of it may be business travel coming back online, but I think business travel has been pretty stable over the past two years. I just don't think you would see record airline travel numbers if leisure travel is dropping. Anecdotally, it also isn't my experience with friends and family. I don't know a single person that "revenged traveled" and is pulling back now. It sounds more like a media story to create something new to report.

But the narrative is also being pushed by companies like Disney to convince shareholders there isn't an issue with the slowing growth in park attendance they are expecting in the third quarter. That's just my opinion, but one that is supported by the airline data and analysists looking at current bookings in the cruise industry as a whole, which still has a very bullish outlook for the remainder of the year. Bookings are high enough on some cruise lines that they are content with this year and are focusing on the next one already, according to Forbes.

People are still traveling. I wouldn't read to much into it, and means nothing as far as the future is concerned.

In the end, slowing travel in the third and fourth quarter is a narrative that everyone is taking as true, while the data is contradicting it leading into the third quarter Let's see how hotels, Universal, and other travel destinations do this third quarter and then we will know for sure. But I'm skeptical. As stated above, so are some analysists.

 

[DCLMP]

I don't buy it. If you took away a big chunk of tourist travel, it's hardly likely that family visits are making up for the drop, plus causing record highs. Some of it may be business travel coming back online, but I think business travel has been pretty stable over the past two years. I just don't think you would see record numbers if leisure travel is dropping. Anecdotally, it also isn't my experience with friends and family. I don't know a single person that "revenged traveled" and is pulling back now. It sounds more like a media story to create something new to report.

But the narrative is also being pushed by companies like Disney to convince shareholders there isn't an issue with the slowing growth in park attendance they are expecting in the third quarter. That's just my opinion, but one that is supported by the airline data, which is probably one of the most accurate indicator of whether people are still traveling, including for leisure. It's also supported by those looking at the data and expectations in the cruise industry as a whole, which still has a very bullish outlook for the remainder of the year. Bookings are high enough on some lines that they are content with this year and are focusing on the next one already, according to Forbes.


In the end, slowing travel in the third and fourth quarter is a narrative that everyone is taking as true, while the data is contradicting it leading into the third quarter Let's see how hotels, Universal, and other travel destinations do this third quarter and then we will know for sure. But I'm skeptical. As stated above, so are some analysists.

I think it's too early to say what the economy is going to do in the third or fourth quarter. There's a lot going on geopolitically around the globe, unstainable debt, and an election year with all the chaos that brings. Things are ok at the moment. What the future holds in unpredictable at best. I don't think Disney attendance is an indicator of anything.

 

[brentm77]

I think it's too early to say what the economy is going to do in the third or fourth quarter. There's a lot going on geopolitically around the globe, unstainable debt, and an election year with all the chaos that brings. Things are ok at the moment. What the future holds in unpredictable at best. I don't think Disney attendance is an indicator of anything.

I agree that it's unpredictable. It's Disney that is saying they are expecting a pretty big slow down in third quarter attendance growth due to slowing leisure travel. My point was, only time well tell whether it's customers choosing other experiences or if it is a trend overall in the leisure travel industry. Other cruise lines are also saying their bookings are great the rest of the year, while people here say they are seeing a change in DCL availability and discounts. I personally don't know if that it true or not, but if true, I don't think it can simply be brushed off as slowing leisure travel as some here have said, while the data in other areas contradicts that so far.

 

[DCLMP]

I agree that it's unpredictable. It's Disney that is saying they are expecting a pretty big slow down in third quarter attendance growth due to slowing leisure travel. My point was, only time well tell whether it's customers choosing other experiences or if it is a trend overall in the leisure travel industry. Other cruise lines are also saying their bookings are great the rest of the year, while people here say they are seeing a change in DCL availability and discounts. I personally don't know if that it true or not, but if true, I don't think it can simply be brushed off as slowing leisure travel as some here have said, while the data in other areas contradicts that so far.

I know quite a few people that are trying their first cruise this year. I think cruising is becoming popular and I personally think it's the all-inclusive aspect of a cruise. The cost of eating out right now is ridiculous whether it's fast food or sit down restaurant. Hotels are not cheap either.

 

[plutolovr]

I honestly dont know where to start. Food options amazing. They don’t have a MDR but all inclusive dining. the food is amazing!!! this was the snack menu with service at my fav lounge with free steak skewers.

No announcements, no addtl tipping, no annoying trying to sell or ship photographer in your face. FREE popcorn, great areas to chill everywhere. Free softdrinks. Normal price drinks again no tipping. Great entertaiment. Food and food again .

I agree with all of this...the big one is NO KIDS!! Taking my adult daughter for her first Virgin cruise. This will be my third. Already booked Panama Canal for 2026.

 

[clarker99]

I agree that it's unpredictable. It's Disney that is saying they are expecting a pretty big slow down in third quarter attendance growth due to slowing leisure travel. My point was, only time well tell whether it's customers choosing other experiences or if it is a trend overall in the leisure travel industry. Other cruise lines are also saying their bookings are great the rest of the year, while people here say they are seeing a change in DCL availability and discounts. I personally don't know if that it true or not, but if true, I don't think it can simply be brushed off as slowing leisure travel as some here have said, while the data in other areas contradicts that so far.

In terms of Experiences (Parks and Cruises) guidance for Q3 and into Q4, from the last earnings call:

Hugh Johnson: 'third-quarter OI is expected to come in roughly comparable to the prior year. Several non-comparable or timing-related items are expected to adversely impact Q3 results, including timing of media and tech expenses, non-comparable items in the prior year at consumer products and the timing of Easter'

Hugh Johson: `we still see in the bookings that when we look ahead, indicates healthy growth in the business.

Bob Iger provides color on the one time charges: 'we do have some one-time expenses occurring in Q3. If we were to back out one-timers both for Q3 and Q4, we expect OI for the quarter to be in the mid-to-high single-digit range for Q3 and to be double-digit for Q4.'

Nowhere in the call or in the reports or in the earnings presentation did they comment on declining demand. They did comment that parks demand is normalizing. Which we should take to mean that Disney is getting back up to 2018/19 attendance figures at its domestic parks. Cruises have really only been back to 90%+ occupancy a year or so. So things are kind of just back to where they were pre-shutdown and they see solid demand and growth with the new ships that are coming.

 

[tidefan]

I agree with all of this...the big one is NO KIDS!! Taking my adult daughter for her first Virgin cruise. This will be my third. Already booked Panama Canal for 2026.

Yeah, I think that the secret is getting out about Virgin Voyages. I personally think that their initial ad campaign (which focused more on a party vibe) did them a disservice as it wasn't really what the experience (which, IMHO, is an upscale, more luxury experience) was. The advertising now is much more on point.

Interesting fact is that Tom McAlpin, who was the president of DCL for a long time was the CEO of Virgin Voyages until he retired in 2023, but he is still the Chairman of the Board of Directors for Virgin, so there is a lot of DCL influence, especially with service, that I think he brought to the line.

 

[Lucien Franciosa]

I don't buy it. If you took away a big chunk of tourist travel, it's hardly likely that family visits are making up for the drop, plus adding enough to cause record high airlines travel (higher than even previous Thanksgiving or Christmas travel, in June!). Some of it may be business travel coming back online, but I think business travel has been pretty stable over the past two years. I just don't think you would see record airline travel numbers if leisure travel is dropping. Anecdotally, it also isn't my experience with friends and family. I don't know a single person that "revenged traveled" and is pulling back now. It sounds more like a media story to create something new to report.

But the narrative is also being pushed by companies like Disney to convince shareholders there isn't an issue with the slowing growth in park attendance they are expecting in the third quarter. That's just my opinion, but one that is supported by the airline data and analysists looking at current bookings in the cruise industry as a whole, which still has a very bullish outlook for the remainder of the year. Bookings are high enough on some cruise lines that they are content with this year and are focusing on the next one already, according to Forbes.


In the end, slowing travel in the third and fourth quarter is a narrative that everyone is taking as true, while the data is contradicting it leading into the third quarter Let's see how hotels, Universal, and other travel destinations do this third quarter and then we will know for sure. But I'm skeptical. As stated above, so are some analysists.

buy it or not.. what is your theory then? that everyone is doing better just not Disney? based on flight bookings? seems rather indirect to me. and anecdotally I know that most of my family 'revenged traveled' and a lot of people I know too. but I am selective about what media I watch so... maybe I trust it more because they tend to stick to facts?

But again, there is a difference between flight bookings and resort bookings. the two are not married.

 

[RivShore]

It's Disney that is saying they are expecting a pretty big slow down in third quarter attendance growth due to slowing leisure travel.

Can you please point us to where you saw this Disney quote?

@clarker99 already noted how the earnings call said nothing like that, so where did it come from?

I don't doubt demand is slowly reverting back to pre-covid, especially with prior comparisons having big anniversary celebrations but "the big slow down" does not seem to be on the horizon at all (barring some black swan type events).

 

[brentm77]

In terms of Experiences (Parks and Cruises) guidance for Q3 and into Q4, from the last earnings call:

Hugh Johnson: 'third-quarter OI is expected to come in roughly comparable to the prior year. Several non-comparable or timing-related items are expected to adversely impact Q3 results, including timing of media and tech expenses, non-comparable items in the prior year at consumer products and the timing of Easter'

Hugh Johson: `we still see in the bookings that when we look ahead, indicates healthy growth in the business.

Bob Iger provides color on the one time charges: 'we do have some one-time expenses occurring in Q3. If we were to back out one-timers both for Q3 and Q4, we expect OI for the quarter to be in the mid-to-high single-digit range for Q3 and to be double-digit for Q4.'

Nowhere in the call or in the reports or in the earnings presentation did they comment on declining demand. They did comment that parks demand is normalizing. Which we should take to mean that Disney is getting back up to 2018/19 attendance figures at its domestic parks. Cruises have really only been back to 90%+ occupancy a year or so. So things are kind of just back to where they were pre-shutdown and they see solid demand and growth with the new ships that are coming.

Can you please point us to where you saw this Disney quote?

@clarker99 already noted how the earnings call said nothing like that, so where did it come from?

I don't doubt demand is slowly reverting back to pre-covid, especially with prior comparisons having big anniversary celebrations but "the big slow down" does not seem to be on the horizon at all (barring some black swan type events).

Although they were in the same section of the earnings call, there were distinct comments regarding the parks growth slowing, particularly at Disneyland, which surprised investors. That is what I was referencing. Here is the quote from Yahoo Finance:

A big surprise — he said Parks growth in the current fiscal third quarter will be flat for a few reasons including “some normalization of post-Covid demand as it relates to demand. While consumers continue to travel in record numbers and we are still seeing healthy demand, we are seeing some evidence of a global moderation from peak post-Covid travel.” Wall Street didn’t quite know what to do with that.

I apologize if I was not more clear, but I did say I don't know if DCL bookings are suffering as others have reported here. The quote about DCL is pretty vague on what they expect on the growth side, and hints at Disney expecting margins to suffer in Q3. Although not mentioned, that could also be from needing to offer more discounted fares and not just increased expenses. It will be interesting to see if people here are right that DCL is having a harder time filling ships. As I said, I have no idea if that is true.

buy it or not.. what is your theory then? that everyone is doing better just not Disney? based on flight bookings? seems rather indirect to me. and anecdotally I know that most of my family 'revenged traveled' and a lot of people I know too. but I am selective about what media I watch so... maybe I trust it more because they tend to stick to facts?

Maybe leisure travel is doing better than Disney - there is certainly consumer backlash from long time consumers that started several years ago with the negative post-pandemic changes in the parks. I don't know. But if Disney is saying we expect growth to slow, but the rest of the world is still showing signs of continued growth, that's a reasonable theory. (It's not like Disney is suffering, it's just that their growth is flat and they expect it to normalize).

I provided the data I am using to form my guesses. First, TSA screening hit record highs yesterday (higher than any holiday travel in history and it wasn't even a holiday). Second, TSA expects the July 4th holiday travel to hit all time records too. Third, earlier in this thread, I posted a Forbes analysis of the cruise industry, which is seeing increasing demand and fantastic booking percentages for the rest of the year. In other words, there aren't a lot of signs the leisure is travel is slowing outside of Disney's expectations of flat park attendance growth. It's entirely possible consumer backlash is showing up as people move their money to other destinations.

 

[clarker99]

But I do know that Disney's prediction that park attendance, particular at Disneyland, will be down in the third quarter, as general leisure travel "normalizes" is not consistent with what we are seeing in airline travel and cruise bookings as we are just about to start the third quarter.

Where did Disney make this prediction? I cannot find this quote.

 

[brentm77]

Where did Disney make this prediction? I cannot find this quote.

Looking a little closer, I am not sure the articles that reported that were 100% accurate. I was relying on third-party reports since I didn't listen to the call. I think the authors were conflating two different things. First, Disney saying they expected a lower OI for Disneyland in the third quarter, and that in the second quarter, it was Hong Kong and Disneyworld that did well. When those comments are combined with the comments about growth normalizing in park demand, I think the authors of the articles I read inferred that, but the lower OI could be only do the increased expenses in the third quarter. Here are the quotes I think they pulled that idea from:

Looking ahead, note that we are currently expecting to incur linear ICC rights expense at Star India in Q3. At experiences, second-quarter revenue grew 10%, operating income grew 12% and segment margins expanded by 60 basis points versus the prior year. Parks and experiences OI increased by 13% year over year and consumer products OI increased by 7%. Strong international parks growth was driven by Hong Kong Disneyland Resort, while Walt Disney World and the Cruise business both contributed to domestic growth.

At Disneyland, despite growing attendance and per-capita spend, results declined year-over-year due to cost inflation, including from higher labor expenses. We continue to expect robust operating income growth at experiences for the full year. However, third-quarter OI is expected to come in roughly comparable to the prior year. Several non-comparable or timing-related items are expected to adversely impact Q3 results, including timing of media and tech expenses, non-comparable items in the prior year at consumer products and the timing of Easter.

Beyond these comparability related headwinds, the third quarter's results will be impacted by three additional factors, higher wage expenses, pre-opening expenses related to the Disney treasure and adventure cruise ships, as well as Disney Cruise Line's New Island, Lookout Cay, and some normalization of post-COVID demand. As it relates to demand, while consumers continue to travel in record numbers and we are still seeing healthy demand, we are seeing some evidence of a global moderation from peak post-COVID travel. While pressures from wages, reopening costs, and demand impacts are expected to persist in Q4, we do expect year-over-year experiences operating income growth to rebound significantly in the fourth quarter due to fewer comparability or timing factors. On an enterprise level, we continue to make good progress on our cost-efficiency initiatives and remain positioned to exceed our $7.5 billion annualized target.

and

First, in terms of attendance, look, what we're basically communicating is relative to the post-COVID highs, things are tending to normalize.

The parks business did 10% growth in the quarter. And obviously, that's an extremely high revenue number. That said, we still see in -- the bookings that we look ahead toward indicate healthy growth in the business. So we still certainly feel good about the opportunities for continued strong growth.

In addition to that, just to comment a bit more on the timing, as I mentioned on the intro, we do have some one-time expenses occurring in Q3. If we were to back out one-timers both for Q3 and Q4, we expect OI for the quarter to be in the mid-to-high single-digit range for Q3 and to be double-digit for Q4. So I certainly feel like the Parks business is still doing very, very well. Obviously, we've got the best in the business in terms of product.

In the end, it's pretty vague on exactly what they expect on attendance, particularly in any one park. I think the reports I read over reported what was actually said. But Disney is setting expectations that stockholders should expect attendance to soften overall, or "normalize" compared to recent years. I also don't see them blaming that on leisure travel slowing everywhere, as I thought they did for some reason. It is more that they are seeing post-covid demand of their parks slowing.

Edit: I don't know how I even got so deep into this discussion. I don't follow the leisure travel industry or Disney stock all that closely, and don't really know how Disney will do the rest of the year. All I know is that I am not seeing signs of leisure travel slowing yet as predicted. If (and that's a big if) Disney does see their demand slow while competitors don't, I think the reasons are pretty obvious and hope that it pushes Disney to get back to focusing on the customer experience from start to finish, and stop relying less on the goodwill the brand earned from past experience and nostalgia. I love there products in general, particularly the DCL experience, but there is a lot of room for improvement. Either way, I will bow out of the discussion of leisure travel and whether DCL or Disney is expecting or seeing decreased demand, because I don't care enough to dig in more and there are more qualified individuals here than me.