Earlier this week The Walt Disney Company reported its financial results for the fiscal 3rd Quarter 2015, posting a record net income and a 13% rise over the prior year.
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For the period ending June 27, Disney reported a profit of $2.5 billion on revenues of $13.22 billion. Both numbers represented an increase over the same quarter in 2014 with profits up 13%.
In the Parks & Resorts segment, profits increased 9% to $922 million while revenues were up 4% to $4.1 billion. Disney attributed the increases to increased theme park attendance, higher hotel occupancy and higher guest spending.
Higher operating income at our domestic operations was primarily due to volume and guest spending growth, partially offset by higher costs. The increase in volumes was due to attendance growth at our theme parks and higher occupied room nights at Walt Disney World Resort and our Aulani resort in Hawaii. Guest spending growth was due to higher food, beverage, and merchandise spending, increases in average ticket prices at our cruise line and Disneyland Resort and higher average hotel room rates. Cost increases were due to labor and other cost inflation, costs for the 60th Anniversary celebration at Disneyland Resort and higher pension and postretirement medical costs, partially offset by lower marketing costs at Walt Disney World Resort.
Disney credited its MyMagic+ technology initiative for the spending increases. Attendance at domestic theme parks, including both Disneyland and Walt Disney World, increased 4% while guest spending rose by 2%.
Disney does not break-down financial results for Disney Vacation Club. However, this reporting period featured three full months sales of Disney's Polynesian Villas & Bunglows, along with the wrap-up of sales at the Villas at Disney's Grand Floridian Resort & Spa. According to monthly reports filed by our own Wil Lovato, Disney Vacation Club sold more than 600,000 points throughout April, May and June 2015.
The feature film unit posted a 13% gain despite poor response to Disney's "Tomorroland."
Analysts remain concerned about the future of Disney's cable business, headlined by the ESPN family of networks. Disney reported a modest loss of subscribers on the cable side, and scaled back its income projections through 2016.
The complete 3rd Quarter earnings report is available online.
