The Walt Disney Company stock closed for the day at $111.75 a share before reporting their earnings for the first quarter (Q1) of fiscal year 2023 which ended on January 2, 2023. According to the earnings report, revenues for the quarter grew 8%.
“After a solid first quarter, we are embarking on a significant transformation, one that will maximize the potential of our world-class creative teams and our unparalleled brands and franchises,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders.”
Diluted earnings per share (EPS) from continuing operations for the quarter increased to $0.70 from $0.63 in the prior-year quarter. Excluding certain items, diluted EPS for the quarter decreased to $0.99 from $1.06 in the prior- year quarter.
The Walt Disney Company’s capital expenditures increased from $1.0 billion to $1.2 billion primarily due to higher spending at Disney Media and Entertainment Distribution and Disney Parks, Experiences and Products. Higher spending at Disney Media and Entertainment Distribution was due to increased technology spending to support Disney’s streaming services. The increase in spending at Disney Parks, Experiences and Products was primarily due to cruise ship fleet expansion.
The Parks, Experiences and Products segment (which includes Disney Cruise Line) saw revenues for the quarter increase 21% to $8.7 billion and segment operating income increased 25% to $3.1 billion. Higher operating results for the quarter reflected increases at Disney’s domestic parks and experiences and, to a lesser extent, Disney’s 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 cost inflation, higher operations support costs and increased costs for new guest offerings. Higher volumes were attributable to increases in passenger cruise days, attendance and occupied room nights. Guest spending growth was due to an increase in average per capita ticket revenue driven by Genie+ and Lightning Lane, which were introduced in the prior-year quarter.
Increased results at Disney’s international parks and resorts were due to growth at Disneyland Paris and higher royalties from Tokyo Disney Resort, partially offset by a decrease at Shanghai Disney Resort. Higher operating results at Disneyland Paris were due to an increase in volumes and higher guest spending, partially offset by a loss on the disposal of our ownership interest in Villages Nature, increased costs for new guest offerings and cost inflation. Higher volumes consisted of increases in attendance and occupied room nights. Guest spending growth was driven by an increase in average ticket prices and higher average daily hotel room rates. The decrease at Shanghai Disney Resort was due to lower attendance reflecting fewer operating days in the current quarter compared to the prior-year quarter as a result of COVID-19-related closures.
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.
For more information and an overall report click over to the Q1-2023 Earnings Report.