Disney revealed on Tuesday its planned investment in its parks business would be approximately $60 billion, almost twice as much as previously planned.The theme parks have been somewhat more successful than the streaming services in terms of profits, though the number of visitors to Walt Disney World and hotel bookings at the Florida location have recently gone down.
Disney said in Tuesday's securities filing that it intends to make a significantly larger investment– around $60 billion – over the course of 10 years. Shares dropped more than 3% in early trading. Attempting to make its streaming business profitable and potentially selling off some of its traditional TV networks, the company's theme parks, experiences and products division has been yielding positive results. Despite this success, domestic parks such as Walt Disney World in Florida have seen a decrease in attendance and hotel room bookings, while growth has been significant in the international parks. In the third quarter, the division had a 13% rise in revenue, totalling $8.3 billion. Disney aims to use its brands and intellectual property to amplify its theme parks. Information about the investment is to be shared at its investor day. Noting attractions related to "Frozen" and "Zootopia" in Hong Kong, Paris, Tokyo and Shanghai, Disney declared that there are abundant tales yet to be experienced in its theme parks. When Bob Iger became CEO once again, changes were announced to the parks due to grievances from guests concerning pricing and wait times. In the investor presentation, Disney explained the parks and experiences business results since 2017 on the back of increased investment. Though the pandemic caused disruption, the company's parks have generated positive results in the past.
Comcast's Universal parks in Florida were rivals to Disney, albeit experiencing a similar slowdown, due to the entertainment company's heightened investment. This came around the same time Disney was embroiled in lawsuits with Florida Gov. Ron DeSantis, making claims that the governor and new board members of Disney's special district were carrying out a campaign of political retribution against the company. Unfazed, Disney announced plans to invest $17 billion in the Florida hub and create 13,000 jobs over the next 10 years.
The cause of these legal issues was Disney's public criticism of a controversial Florida bill – nicknamed "Don't Say Gay" – that seeks to limit the discussion of sexual orientation and gender identity in classrooms, a move which Ron DeSantis had taken offense to. As of earlier this month, Disney had dropped all but its First Amendment claim, which states the governor politically retaliated against them.
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.
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