In terms of average revenue per paid subscriber, a metric closely watched by investors, Disney+ declined in North America (to $6.10 from $6.81) and increased in most markets overseas (to $5.83 from $5.62). The decline in North America was because of a larger number of subscribers from Disney’s discounted “bundle” offering that includes Disney+, ESPN+ and Hulu.
In total, Disney generated $20.15 billion in revenue in the quarter, a 9 percent increase from a year earlier. Analysts had expected $21.3 billion.
Profit totaled $162 million, or 9 cents a share, roughly flat from a year earlier. Excluding items affecting comparability, per-share profit for the most recent quarter was 30 cents. Analysts had expected closer to 50 cents.
Disney has primarily relied on revenue from its theme parks to fund the construction of Disney+ and to pay down debt incurred during the height of the pandemic, when almost all Disney businesses were shut down. So far, that bet is paying off: Disney’s domestic theme park resorts were jammed in the quarter and spending on food and merchandise soared.
Revenue at Disney Parks, Experiences and Products totaled $7.43 billion, a 36 percent increase from a year earlier, despite continuing coronavirus restrictions at Shanghai Disneyland and the closure of Walt Disney World in Florida for a time because of Hurricane Ian. Operating profit more than doubled, to $1.5 billion, in part because Disney cruise ships were sailing again.
But analysts and investors are worried about a deteriorating United States economy.
“A looming recession could dampen near-term demand” for theme park vacations, the Macquarie analysts Tim Nollen and Max Schmitt told clients on Oct. 31. “We are hopeful that a mild recession, if unemployment does not spike and consumers continue to absorb inflationary pressures, might not be nearly as bad this time as in 2009.”
Disney has expressed its confidence by continuing to increase prices for tickets and line-shortening privileges. Price increases were introduced last month, making a single-day ticket at Disneyland in California cost as much as $179 over the Christmas period, up from $164 in 2019. Access to the Genie+ line-shortening system will add at least $25 per person, up from $20.
Source: | This article originally belongs to Nytimes.com
