As Universal Studios continues to develop its global theme park presence, Comcast’s most recent Q4 Earnings report suggests newfound financial success in both international and domestic markets, but how much of this shift is due to recent pitfalls by its competitor, Disney?
Universal Studios Parks and Resorts, now a division of Comcast and NBCUniversal, and the Walt Disney Company have been in competition within the themed entertainment sphere since at least the 1980s — if not all the way back to the days of Oswald. Of course, most theme park fans know about both companies’ race to open the first Hollywood Backlot Tour-based Resort within the Orlando area, leading to noted similarities between Universal Studios Orlando and Hollywood with the now Disney’s Hollywood Studios Park.
Especially since Universal acquired the theme park rights to Warner Bros.’ Harry Potter franchise, building the highly acclaimed Wizarding World of Harry Potter areas within its Parks, it has become a true competitor in terms of Guest Experience and immersion on par with that of the Walt Disney Resort, or Disneyland in Southern California. In fact, its upcoming debut for Universal Studios Hollywood’s Super Nintendo World projects great popularity for the company within the coming years.
In addition, due to some of Disney Parks’ decisions since the Covid-19 pandemic began, such as the introduction of a Park reservation system, the removal of Fastpass, increased ticket prices and reduced staff as a result of fluctuating operations costs, and the removal of some popular attractions, many longtime Disney fans have left their Mickey ears behind, becoming self-proclaimed “Universal families” and Annual Passholders. Could this change in loyalty somewhat account for Universal’s recent increased success for this fiscal year?
As digital journalist Ashley Carter of MyNews13 reports, Universal Studios saw a 12% revenue increase for its Parks in both the U.S. and Japan, bringing in a total of $2.1 billion as a result of higher Guest attendance as well as spending during their visits. Moreover, Universal’s total theme park revenue across the entire fiscal year reached $7.5 billion, an increase of nearly 50% compared to 2021 due to improved operating conditions.
As a result, Universal has room to announce even more expansion, such as its Epic Universe Park coming to Orlando by 2025, a costly investment that increased NBCUniversal’s capital expenditures by 82.6%. This $916 million value reflects the company’s growing success in being able to take on projects like this, along with the new Parks in Texas and Las Vegas.
Though the Walt Disney Company’s first earnings report of this year will not release until February of 2023, a look at its most recent Q4 earnings shows that in Disney’s U.S.-based Parks, “operating income growth” was “partially offset” by “cost inflation” as well as an increased expense for “operations support.” Former CFO Christine McCarthy even reported an “adverse impact of approximately $65 million dollars to segment operating income” at Walt Disney World due to closures caused by natural disasters like Hurricane Ian and reduced attendance numbers.
This could also be partly due to former CEO Bob Chapek’s focus on making the company’s streaming service profitable, which led to what some felt left the Disney Parks “neglected.” Now, with a 40% increase in per capita spending for Disney’s domestic Parks, Disney seems to be working hard to recapture its audience and revenue, not just in the media and streaming spheres but for Disney Parks and Resorts as well. However, as the Walt Disney Company also reported its all-time highest revenue for the fiscal year 2022, it’s likely not too worried about a little competition!