Walt Disney Co. is almost doubling its investment in its Parks, Experiences and Products division to approximately $60 billion over the next 10 years.
The investment will include expanding and enhancing domestic and international parks and cruise-line capacity and prioritizing projects anticipated to generate strong returns, according to a filing with the Securities and Exchange Commission. Disney says it has more than 1,000 acres of land available for future development globally. (That’s the equivalent of about seven new Disneyland parks.)
Disney shares
DIS,
are down 3.6% in late morning trading Tuesday.
Disney Chief Executive Bob Iger, who made the investment announcement to Wall Street analysts and investors at Walt Disney World Resort in Orlando, Fla., on Tuesday, has described the parks as “a tremendous business” for Disney. Indeed, Disney’s theme parks have been a top priority for Iger since he succeeded Bob Chapek as CEO late last year.
Disney’s Parks, Experiences and Products segment — propelled by the additions of Disney’s Hollywood Studios in Orlando, Star Wars Galaxy’s Edge at Disneyland, Walt Disney Studios Park in Paris, and Cars Land at Disney California Adventure — generated $32.3 billion in operating income over the last 12 months, according to a presentation included in a regulatory filing.
The investment comes amid a summer slowdown at Walt Disney World in Orlando. One of the slowest July 4 holiday weekends in nearly a decade has prompted a debate over whether the iconic park is a victim of terrible weather, political squabbles or prohibitive ticket prices.
Disney rival Comcast Corp.
CMCSA,
has been plowing money into its Universal Studios theme-park business with smaller attractions planned in Texas and Nevada and a giant new resort under construction in Orlando.
Iger has been exploring ways to beef up parks-related revenue as the world’s largest theme-park operator grapples with radical changes in traditional TV and movie markets. Consumers are watching more content on streaming services, for example, prompting Iger to acknowledge Disney may sell ABC, as well as search for a strategic partner at ESPN.
Disney’s stock has fallen 5.7% in 2023, compared with the S&P 500 index’s
SPX,
gain of 15%.