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Yesterday, The Walt Disney Company released its quarterly earnings report and, as expected, the company touted the amazing performance of its film properties during this quarter, which included a record-breaking run by Finding Dory at the box office.

However, though Disney had some really great news from its films division for shareholders, CEO Bob Iger didn’t mention that much about Disney Parks and Resorts during the investors call and presentation. And after a quick look at the press release detailing the financial results (which you can read in full here), it’s not very hard to see why, as the news out of Disney Parks, especially in the US, isn’t immediately spectacular. It's not all doom and gloom either, but let's get the obvious out of the way first...

1. Domestic attendance at Disney Parks is now confirmed to be down year over year

Surprising absolutely no one who has been to a Disney park in the past three months, Disney has confirmed that attendance, specifically at the US theme parks, is down year over year during the third quarter. As expected, Disney didn’t confirm by what percentages specific parks were down during this time, instead simply saying that Disney parks were down 4% during this period in attendance overall. We’d imagine that the vague wording here was purposeful, as drops at Walt Disney World in particular are likely pretty big, with Disneyland potentially still seeing gains (or at least staying flat) due to its (ending) 60th Anniversary celebration as well as the Season of the Force event.

It’s also worth remembering that the fiscal quarter to which this report is referring only covers the period from April 1 to June 30, 2016, which means that lower attendance in July and August will be reflected in the next quarterly report, which could be substantially worse than this one.

Though the attendance drops aren't exactly surprising, it will be interesting to see what happens in the fourth quarter and beyond, especially if further drops give rise to a period of substantial discounts, similar to 2009/2010, which saw free ticket giveaways and unprecedented deals for guests in the wake of a US recession. 

While we don't exactly know how Disney will push back against these drops in the future, the resort has confirmed that it is making some adjustments in the short term to try and stem revenue losses from lower attendance.

2. Budget cuts are already happening everywhere, and more might be coming 

Though Disney does not typically confirm when budget cuts occur in its Parks and Resorts division, they did concede in their earnings report that “cost efficiency initiatives” (a fancy term for budget cuts) are currently underway at both Walt Disney World and Disneyland Resort . That matches up with recent reports that have said massive layoffs have hit the company recently (particularly in the Imagineering department) and rumors that more cuts will be coming in late August and early September (including the end of Paint the Night and Disneyland Forever at Disneyland).

Unfortunately, this summer has been a disappointing one for Disney, and it looks like the company is going to try and run their parks as trimly as possible for the next few months while they recover in the short term. However, it's not all bad news...

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We have been DVC members since 2002 and own at two resorts, with 2-3 trips a year and frim out of state, but are not planning another trip for at least 2 years. We will bank our points. It is too expensive for tickets for what you are getting. Hollywood Studios is basically closed, compared to the past. Epcot is now just the countries, except for fast track and soarin. The countries have not changed or updated in years. The service you receive in the parks is subpar for what you are paying. You used to get good natured cast members that were helpful and friendly, that is few and far between now. The front desk at the Bay Lake Towers and Boardwalk were horrendous. Had major issues at both and no one cared. Have taken 3 cruises and we are now changing to Royal instead. I can get 2 connected balcony rooms for the cost of one Disney room and they have more for the kids to do. When your mist ardent fans, your DVC owners stop coming you know there is an issue.

We have been DVC members since 2002 and own at two resorts, with 2-3 trips a year and frim out of state, but are not planning another trip for at least 2 years. We will bank our points. It is too expensive for tickets for what you are getting. Hollywood Studios is basically closed, compared to the past. Epcot is now just the countries, except for fast track and soarin. The countries have not changed or updated in years. The service you receive in the parks is subpar for what you are paying. You used to get good natured cast members that were helpful and friendly, that is few and far between now. The front desk at the Bay Lake Towers and Boardwalk were horrendous. Had major issues at both and no one cared. Have taken 3 cruises and we are now changing to Royal instead. I can get 2 connected balcony rooms for the cost of one Disney room and they have more for the kids to do. When your mist ardent fans, your DVC owners stop coming you know there is an issue.

I was at WDW last week and noticed the quality had gone down at all the parks -- a toilet was running outside the ticket booth one morning and was still running when I went back in the restroom 8 hours later; also overflowing trashcans, trash in the street, and lack of listed menu items at the restaurants. If budget cuts mean laying off workers than park quality is only going to get worse. I am also a passholder and stockholder but I do not feel that the quality I am receiving at the park is justifying the price. Universal Studios is currently offering a better entertaiment value.

Just went to Disneyworld and had a blast. Our kids who are from ages 18 to 10 had a wonderful time and we created some great memories. However, sadly, this is our last time going for quite some timE(Congrats DVC members and shareholders, you got your wish! 5 less people in line). It will take us years to get back due to cost of total vacation; combine that with so much construction at most parks that it will takes years to complete. And after it is complete it takes about 3 years to actually get a place in line to ride any new ride. And to take a cruise is insane. 6k in the off peak time of the season!?! They may as well just let us know they are advertising only to the upper class so we can at least figure somewhere else to go on vacation.
We love going to Disney. The memories last us forever and the experience is fantastic. Can't get enough, but we have to be reasonable. We had to save for 4 years to return to wdw. And that was with the help of our disney rewards. Without those we would have not made it. The extras have priced us right out of the parks and hotels. $75 average for a quick service meal at any park is crazy (party of 5). $25 to $65 for a stuffed animal or $35 a shirt (again, shareholders rejoice!); $200 a night for an "moderate" hotel? The park prices are not terrible but yes it would help to bring them down. The company has to eventually realize that the decline at the parks has to be dealt with and raising prices somewhere else is only a band aid.
It also depresses me that the shareholders don't seem to realize that the more they push out the occasional visitor just so they don't have to wait in line, that eventually their shares are going down. The very people who they don't want to wait behind are the people making them $. That really makes me want to take our next vacation straight to the beach!

I bought my first season pass last Sept and having to travel from TX, dont get to use it much. But EVERYTIME i chose to go this year (all Off season) the parks have been PACKED. and i just stayed away ALL summer.

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