The Walt Disney Company stock closed for the day at $112.43 a share before reporting their earnings for the third quarter (Q3) of fiscal year 2022 which ended on July 2, 2022. Revenues for the quarter Revenues for the quarter and nine months grew 26% and 28%, respectively.
Diluted earnings per share (EPS) from continuing operations for the quarter increased to $0.77 from $0.50 in the prior-year quarter. Excluding certain items(1), diluted EPS for the quarter increased to $1.09 from $0.80 in the prior-year quarter.
Diluted EPS from continuing operations for the nine months ended July 2, 2022 increased to $1.66 from $1.02 in the prior-year period. Excluding certain items(1), diluted EPS for the nine months increased to $3.22 from $1.91 in the prior-year period.
“We had an excellent quarter, with our world-class creative and business teams powering outstanding performance at our domestic theme parks, big increases in live-sports viewership, and significant subscriber growth at our streaming services. With 14.4 million Disney+ subscribers added in the fiscal third quarter, we now have 221 million total subscriptions across our streaming offerings,” said Bob Chapek, Chief Executive Officer, The Walt Disney Company. “We continue to transform entertainment as we near our second century, with compelling new storytelling across our many platforms and unique immersive physical experiences that exceed guest expectations, all of which are reflected in our strong operating results this quarter.”
The Parks, Experiences and Products segment (which includes Disney Cruise Line) saw revenues for the quarter increased to $7.4 billion compared to $4.3 billion in the prior-year quarter. Segment operating income increased $1.8 billion to $2.2 billion compared to $0.4 billion in the prior-year quarter. Higher operating results for the quarter reflected increases at domestic parks and experiences and, to a lesser extent, at international parks and resorts.
Operating income growth at Disney’s domestic parks and experiences was due to higher volumes and increased guest spending, partially offset by higher costs. Higher volumes were due to increases in attendance, occupied room nights and cruise ship sailings. Cruise ships were operating during the entire current quarter while sailings were suspended in the prior-year quarter. Guest spending growth was due to an increase in average per capita ticket revenue and higher average daily hotel room rates. The increase in average per capita ticket revenue was due to the introduction of Genie+ and Lightning Lane in the first quarter of the current fiscal year and a reduced impact from promotions at Walt Disney World Resort, partially offset by an unfavorable attendance mix at Disneyland Resort. Higher costs were primarily due to volume growth, cost inflation and new guest offerings.
Disney’s domestic parks and resorts were open for the entire current quarter, whereas Disneyland Resort was open for 65 days of the prior-year quarter, and Walt Disney World Resort operated at reduced capacity in the prior-year quarter.
Improved results at Disney’s international parks and resorts were primarily due to growth at Disneyland Paris, partially offset by a decrease at Shanghai Disney Resort. Higher operating results at Disneyland Paris were due to increases in attendance and occupied room nights, partially offset by higher operating costs due to volume growth. Disneyland Paris was open for the entire current quarter compared to 19 days in the prior-year quarter. The decrease at Shanghai Disney Resort was due to the park being open for all of the prior-year quarter but only for 3 days in the current quarter.
There was no additional details regarding Disney Cruise Line in the press release, but the following was shared during the earnings call Q&A.
And a couple things, you know, the Wish is our newest ship and that’s gone with very, very high capacity and that one, it’s just very well-received. We have a competitive position, overall, in the cruise business, especially the family cruise markets, so, we generate pricing well above the industry average and our cruise ships deliver for us, one of the highest-rated quest experiences across all of our parks and experiences offerings. This is a really interesting comment that we received from our cruise passengers. 40% of them say that they would not have chosen to go on a cruise vacation if it weren’t a Disney cruise. We’re a unique product and still a relatively small share of the cruise market. And we’re positioned for growth. The other four ships are all sailing. Their occupancy is improving week by week.
Christine M. McCarthy – Senior Executive Vice President and Chief Financial Officer of The Walt Disney Company
For more information and an overall report click over to the Q3-2022 Earnings Report.