Disney lost nearly $5B while theme parks were closed due to coronavirus

The Walt Disney Company lost nearly $5 billion (U.S.) April, May and June, while its theme parks were shut down due to the coronavirus pandemic, according to a presentation Disney executives made Tuesday.

It cost the company $3.5 billion just to close the parks during the third quarter, on top of the $1 billion it cost to shut them down the second half of March.

In all, the company posted a loss of nearly $5 billion for the third quarter, including a $2 billion loss in its parks, experiences and products segment.

Disney’s domestic parks — Disney World and Disneyland, as well as Disneyland Paris, resorts and cruise operations were closed for the entirety of the quarter and the final two weeks of the previous quarter.

The company’s parks, experiences and products segment revenue declined 85 per cent to $1 billion compared with the same quarter in 2019. Operating income fell $3.7 billion to a loss of $2 billion.

Disney’s media networks segment helped offset the losses from parks, experiences and products. Across all segments, the coronavirus pandemic’s impact cost the company $2.9 billion in April, May and June.

“This is obviously a very uncertain time,” CEO Bob Chapek said during an earnings webcast Tuesday. “We should be in good shape once consumer confidence returns.”

Disney has felt the full impact of the coronavirus pandemic, from its theme parks, resort hotels and retail stores, to its cruise lines and TV and film production.

Disney World in Florida and Disneyland Paris both opened in July; Disneyland backed off its plan to reopen July 17 amid the COVID-19 surge in California and has not announced a new reopening date.

Shanghai Disneyland reopened in May. While Hong Kong Disneyland reopened in June, it closed again in July because of a new coronavirus outbreak.

Both California and Florida have the highest numbers of coronavirus cases in the country.

As of Tuesday, the Florida Department of Health counted more than 497,000 total cases, making the state second only to California, with more than 519,000 cases.

The coronavirus surge in Florida has resulted in more cancellations and lower attendance than the company was expecting, with the park operating at lower capacity, Disney executives said Tuesday in the earnings presentation.

Chapek said Disney World had experienced a fall-off in visitors coming to the park from out-of-state. Long-distance travel remains well below last year’s volume, and airlines have cut flights from their schedules.

Get the latest in your inbox

Never miss the latest news from the Star, including up-to-date coronavirus coverage, with our email newsletters

Sign Up Now

The impact of the park’s reopening on the company won’t be known until it releases fourth-quarter results.

“We expect demand will grow when the COVID situation in Florida improves,” said Christine McCarthy, Disney’s chief financial officer.

Football news:

Kolasinac will move to Bayer from Arsenal for 11 million euros + bonuses (Fabrizio Romano)
Dyer called the toilet the best player of the match between Tottenham and Chelsea
Ferencvaros will play in the Champions League group for the first time since 1995. This is the longest break between the first and second appearances
Jose Mourinho: what happened to Dyer is not normal, he was dehydrated. If the League management doesn't care about the players, I don't
Jose went berserk twice during the match with Chelsea: ran over Lampard and ran to look for Dyer - he rushed to the toilet right during the game
Lampard on relegation from the League Cup: we Need to keep a positive attitude. Everything will come if Chelsea score second, leading the score
Call of nature, what can you do? Dyer explained why he ran to the dressing room during the match with Chelsea