Walt Disney Company Quarter 2 Earnings Report 2020

[JacknSally]

1) can wdw get to "positive contribution" level without international guests??

If Shanghai typically sees 80,000 people and can get to "positive contribution" with "far below" 24,000 people, then I would think WDW could also and wouldn't need the international guests to do it. I believe the data used in the threads here is that MK typically sees 65,000.

 

[wareagle57]

They were talking about incoming revenue when Positive Contributions was mentioned. Vacationers are more likely to push them more into a positive opening than locals. They buy more merchandise and food than locals, more resort rooms (I understand some locals stay on property) and more ticket sales

Wow completely misread that. My mistake. i thought it was saying the exact opposite, that it wouldn't be about when they could make money or break even.

 

[anthony2k7]

When do we think international guest might be able to enter the United States again, Virgin that partners Disneys own vacations here in the uk downed six planes that they use for Orlando.

Not just downed the planes, literally abandoned the airport they fly most passengers to MCO from as well!

Likewise BA threatening to abandon Gatwick where they fly to MCO from.

Right now it's not clear the UK will actually have a major airline still flying to Orlando in the future.

 

[Pickle Rick]

And a lot of international have been sent home & no college program so that’s done already. Plus the task force recommendation that those 65 of older stay home too.

Regular CM's IMO could work in the places the ICP's did until they get a new batch. The older CM's is interesting, because many CM's are over 65.

 

[Eric Smith]

So my takes from that....

1) can wdw get to "positive contribution" level without international guests??

2) no mention of DLP at all? Considering they have lost money almost every year they have been open, reaching "positive contribution" there could take a while.

The answer to 1) is absolutely.

 

[rteetz]

No leak, but there have been rumors of it for what, 2-3 weeks now with the opening of their shopping district and hotels? Nothing official 6 days out is kinda quick, but I'd imagine we'll have more than 6 days "notice" for us to be anticipating the opening date. They could announce June 30th on June 24th, but more than like if that happens, around Jun 7th there will be rumblings of hotels and Springs opening before that.

I think like we saw with Shanghai, Disney will be cautious with announcing any openings here. I definitely see Springs and possibly hotels opening probably before or around June 1st but I think there is a distinct possibility that the parks may open after June 1st.

 

[Mit88]

Wow completely misread that. My mistake. i thought it was saying the exact opposite, that it wouldn't be about when they could make money or break even.

Its up for individual interpretation. That’s what it sounded like to me, but that might not be the case. We won’t know until we know

 

[rteetz]

If Shanghai typically sees 80,000 people and can get to "positive contribution" with "far below" 24,000 people, then I would think WDW could also and wouldn't need the international guests to do it. I believe the data used in the threads here is that MK typically sees 65,000.

MK has a max around 90,000-100,000. Disney doesn’t release exact numbers so it’s all just estimates. The 80K comment today was really the first time disney has commented on Park capacity.

 

[UkDisney73]

I know in Canada in general we seem to be a lot less eager to throw things open than our neighbours down south. For perspective my province has has between 0-4 new cases a day for the last couple weeks, I think less than 10 deaths, and we have started our slow reopening yesterday with many people thinking we’re moving too quick.

I think it’s going to be a bit until we can actually cross the border and then even longer before we aren’t placed in a 14 day quarantine upon arrival back home.

I think it's similar here in the uk, they're talking about eassing restrictions and rather than people wanting it, people seem reluctant. I have a holiday to Disney World in August and all though I think disney will be open, I'm not sure international flights will be arriving in Orlando and even if they are, there would likely be a quarantine as you mentioned.

 

[OnceUponATime15]

MK has a max around 90,000-100,000. Disney doesn’t release exact numbers so it’s all just estimates. The 80K comment today was really the first time disney has commented on Park capacity.

New Bob.. less filter! lol..

 

[CastAStone]

Are you referring to the "positive contribution" quote? That could be taken so many ways. I don't see how it's not positive to get people back to work and to get them familiar with new procedures, while also allowing those most likely to go anyway the chance.

Positive contribution is a business term. When a business segment’s revenues exceed its variable costs operating costs, it is making a positive contribution to the company’s profits (vs shutting it down altogether).

But that doesn’t mean it’s profitable. If it has a zillion dollars in fixed costs (Like WDW), it can still lose a ton of money and and have a positive contribution vs being closed.

 

[JacknSally]

MK has a max around 90,000-100,000. Disney doesn’t release exact numbers so it’s all just estimates. The 80K comment today was really the first time disney has commented on Park capacity.

Oh, I know. Like I said, the rough data I've seen used in the main speculation threads here (I believe @yulilin3 was the one posting it) was that MK max is around 100,000 and typical attendance is around 60,000-65,000. Since they referenced "standard" capacity in the call today, not max, I'm assuming the 80,000 rough number Chapek threw out was Shanghai's typical attendance and not max capacity.

 

[LSUmiss]

They know the math, and they have an internal date.

No I know. But they might not know how to gauge if ppl will come or if they’ll spend $$.

 

[jamescanuck2001]

I'm gung-ho for WDW with no lineups.

 

[OnceUponATime15]

I'm gung-ho for WDW with no lineups.

If you can get across ther border.. lol.

 

[LSUmiss]

And why they are still allowing booking - how else will they get numbers to do the math with?

Exactly. That’s what I meant by not being able to do the math yet. But seems to me they need an intentional leak or new promotion b/c why would ppl book now if they keep saying they don’t know when they’ll open.

 

[JacknSally]

No I know. But they might not know how to gauge if ppl will come or if they’ll spend $$.

They seemed very confident in the call today that, due to pent-up demand, they would reach whatever capacity cap they set, be it 10% or 50%. I might have missed if they gave a concrete reason for that confidence, but I'm guessing it's based on current bookings.

 

[RamblingMad]

Disney+ is exceeding expectation which for a time like this is good. Their overall revenues exceeded projections as well. Shanghai reopening is positive news for that segment. Film they have movies that have been filmed and are delayed so they can still put those out next year. This year was never going to be as huge as 2019 with Endgame and films like that.

I’d expect Disney+ to exceed expectations after Netflix’s report. Shanghai opening is positive. As for the revenues, they were still open for most of last quarter.

What I’m thinking about is the next two years and how they will manage their cash burn. They sounded like they would have to raise more cash if they couldn’t open back up soon. And it looks likely they will cut their other dividend too.

This stock should become far more cheaper, and my fall Disneyland trip looks less likely to happen.

 

[SierraT]

I was 75% in the June 1 opening camp and now it’s down to 50%. That said, I’m far more optimistic that they won’t open until they feel people will feel safe going there. I think that’s a good thing.

 

[yulilin3]

If you can get across ther border.. lol.

what border? I'm not understanding what you mean