The Walt Disney Company stock closed for the day at $179.42 a share before reporting their earnings for the third quarter (Q2) of fiscal year 2021 which ended on July 3, 2021.
Diluted earnings per share (EPS) from continuing operations for the quarter was income of $0.50 compared to a loss of $2.61 in the prior-year quarter. Excluding certain items, diluted EPS for the quarter increased to $0.80 from $0.08 in the prior-year quarter. Diluted EPS from continuing operations for the nine months ended July 3, 2021 increased to income of $1.02 compared to a loss of $1.17 in the prior-year period. Excluding certain items, diluted EPS for the nine months decreased 14% to $1.91 from $2.22 in the prior-year period.
“We ended the third quarter in a strong position, and are pleased with the Company’s trajectory as we grow our businesses amidst the ongoing challenges of the pandemic,” said Bob Chapek, Chief Executive Officer, The Walt Disney Company. “We continue to introduce exciting new experiences at our parks and resorts worldwide, along with new guest-centric services, and our direct-to-consumer business is performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of the quarter, and a host of new content coming to the platforms.”
The Parks, Experiences and Products segment (which includes Disney Cruise Line) saw revenues for the quarter decreased 44% to $3.2 billion, and segment operating results decreased $1.2 billion to a loss of $406 million. Lower operating results for the quarter were due to decreases at our parks and experiences business, partially offset by growth at Disney’s consumer products business.
Disney Parks, Experiences and Products (which includes Disney Cruise Line) saw revenues for the quarter increased to $4.3 billion compared to $1.1 billion in the prior-year quarter. Segment operating results increased $2.2 billion to income of $356 million. Operating income for the quarter reflected increases at Disney’s domestic and international parks and experiences businesses and at merchandise licensing and retail.
Growth at Disney’s parks and experiences business was due to the reopening of our parks and resorts. Walt Disney World Resort and Shanghai Disney Resort were open for the entire quarter. In the prior-year quarter, Walt Disney World Resort was closed for the entire quarter and Shanghai Disney Resort was open for 48 days. Hong Kong Disneyland was open for 72 days in the current quarter and 10 days in the prior- year quarter. Disneyland Resort and Disneyland Paris were open for 65 days and 19 days respectively, during the current quarter, whereas these businesses were closed for all of the prior-year quarter. During the periods Disney’s parks and resorts were open, they were generally operating at reduced capacities.
Growth in merchandise licensing was primarily due to higher revenue from merchandise based on Mickey and Minnie, Star Wars, including The Mandalorian, Disney Princesses and Spider-Man. The increase at our retail business was due to higher results at Disney Stores, most of which were closed in the prior-year quarter and the comparison to the write-down of store assets in the prior-year quarter.
Since early 2020 and continuing into 2021, COVID-19 and measures to prevent its spread have impacted Disney’s segments in a number of ways, most significantly at the Disney Parks, Experiences and Products segment where our theme parks and resorts have been closed and cruise ship sailings and guided tours have been suspended. Theme parks and resorts resumed operations, generally at reduced capacity, at various points since May 2020 through June 2021 and Disney has commenced an ongoing return of cruise ship sailings and guided tours.
There were no additional details regarding Disney Cruise Line in the press release. We will update this post if we hear anything during the earnings call and Q&A. During the conference call, Bob Chapek did mention future bookings have been strong and the Disney Wish marketing push was deemed a success.
For more information and an overall report click over to the Q3-2021 Earnings Report.