Disney World Raises Prices, Perks, and Hope
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It’s not just some of Walt Disney‘s (DIS -0.45%) premium streaming services getting more expensive this month. The entertainment giant tweaked some of the ticket prices for its domestic theme park resorts on Tuesday. It’s not all bad news, as Disney World relaxes one of its more unpopular passholder restrictions at Disney World, and both resorts are holding the line on their cheapest one-day admissions.
“We are constantly adding new, innovative attractions and entertainment to our parks and, with our broad array of pricing options, the value of a theme park visit is reflected in the unique experiences that only Disney can offer,” a Disney spokesperson explains.
Let’s dive into what this means for theme park enthusiasts. Naturally, we will also get into what it means for Disney shareholders.
It’s not such a small world after all
Let’s start at Disney World, where ticket prices for its date-based admissions are staying where they are. It’s just the annual passes that are climbing 3% to 10% higher, amounting to an increase between $30 and $50 a year. Daily parking prices are going from $25 to $30, in line with Disney World’s two largest rivals. Parking is included with all of its annual passes.
The hikes are modest relative to what amusement park operators, including Disney, have been pushing out during the pandemic, and there will be a new perk early next year. Passholders who have been restricted from visiting a second park until after 2 p.m. will now be able to travel to a second gated attraction immediately after tapping into their first theme park.
The increases are more pronounced at Disneyland. Prices for single-day admissions beyond the lowest-priced $104 ticket are being bumped 4% to 9% higher. Some multiday tickets and park-hopper options are rising as much as 16% and 25%, respectively. Annual pass prices are increasing 3% to 22% for the original resort. Parking and advance Genie+ purchases will also cost $5 more at Disneyland.
![A theme park visitor approaches the Disney castle wearing purple mouse ears.](https://wmal.net/wp-content/uploads/2023/10/Disney-World-Raises-Prices-Perks-and-Hope.jpeg&op=resize&w=700.jpeg)
Image source: Disney.
The bittersweet changes are more bitter than sweet for theme park buffs, even as it rolls out demand-based promotions including a recent deal for young families to get discounted tickets and dining plans for kids in a resort stay package. The news is naturally far sweeter for Disney shareholders. Disney stock hit a nine-year low last week. Its theme parks business has proven the most resilient segment for the out-of-favor media stock. It’s generating record revenue and operating profits at a time when its legacy media networks are sliding and some high-profile theatrical releases have fallen flat. Its premium streaming services are starting to show bottom-line improvement, but the road could be long between today’s narrower deficits and the profitability that Disney is hoping to achieve by the end of next year.
There will be critics of the higher price points, but guests keep coming. Escapism has earned its premium these days, and Disney is making sure it keeps investing in its money makers. It revealed last month that it will be investing $60 billion in its theme park resorts and cruise ships over the next 10 years, nearly doubling its capital resources to keep its leisure business fresh.
Raising theme park prices also gives Disney new ammo as it prepares for a potential proxy battle at its next shareholder meeting. Between higher prices for its digital content and attractions and plans to exceed $5.5 billion in annual cost cuts by the end of next year, all that Disney needs now is to spin off or sell noncore assets to appease most of what activist investor Nelson Peltz was clamoring for earlier this year.
The stock is already trading 8% higher since bottoming out last week. It might not be just Disney World passholders doing some early hopping come January.
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