The Walt Disney World Resort in Florida has been a major tourist destination and economic engine for the state since it opened in 1971. But recent political clashes with state lawmakers over issues like Disney’s opposition to the controversial “Don’t Say Gay” bill have led to speculation that the company could consider relocating its Orlando theme parks. While Disney has made no announcements about leaving Florida, the mere rumors have raised questions about the potential economic impact on the state if the resort did move.
Is Disney Looking to Move Out of Florida?
In April 2022, Florida Governor Ron DeSantis signed a law dissolving Walt Disney World’s private self-governing district, the Reedy Creek Improvement District. This came in retaliation for Disney’s public opposition to the state’s Parental Rights in Education bill, which critics dubbed the “Don’t Say Gay” law. This led to speculation that Disney could look to relocate its theme park empire outside Florida in the future.
The Walt Disney Company has not made any official announcements about moving Walt Disney World yet. But CEO Bob Chapek has hinted at looking more closely at the company’s global footprint and investments. “We’re going to think about where we put that capital,” Chapek said after the clash with DeSantis. With Disney’s massive financial contributions to Florida now in jeopardy, rumors have spread that the company could move its Orlando resorts to another state more welcoming to its values.
Josh D’Amaro, Disney’s parks chairman, also commented that the company would consider relocating employees to other states that have more “business-friendly” environments. This added more fuel to rumors about a possible Disney World exodus from Florida. Still, the massive costs and infrastructure involved in uprooting make any near-term move unlikely. Disney has only said it is exploring “all our options.”
What Would Happen to Florida’s Economy if Disney Left?
As the largest single-site employer in the United States with over 75,000 workers, Walt Disney World Resort has an enormous economic footprint in Central Florida. According to an analysis by the University of Florida, Disney contributed $5.8 billion alone in state GDP in 2017. It also generated $70 billion in overall economic activity that supported more than 400,000 jobs statewide.
State lawmakers estimate Disney currently accounts for between 2.5% and 5% of Florida’s total economy. Losing Disney could cut Florida’s GDP by over 4% and put nearly half a million jobs at risk. The impact would extend far beyond the Orlando area, affecting the entire tourism industry statewide. Disney World attracted over 50 million visitors in 2021, making it the world’s most visited theme park by far.
Beyond employment and tourism dollars, Disney World provides vital tax revenue for state and local governments in Florida. If Disney pulled out of the state, Florida would lose up to $780 million in annual tax collections from the company. The Reedy Creek Improvement District also provides essential public services like fire protection, emergency response, utilities infrastructure and transportation for Disney World’s 40 square mile footprint. If this district dissolved, local municipalities could not easily absorb all these services.
The potential economic fallout from Disney relocating its theme park resort outside Florida would be devastating. With no equivalent employer ready to fill the void, the state would risk plunging into a major recession. For now, Disney and Florida officials seem motivated to repair their relationship before relations fray beyond the breaking point. But the door may have opened for another state to lure Disney World away someday.
Is Disney Struggling Financially?
The Walt Disney Company faced serious financial struggles during the COVID-19 pandemic as theme parks and movie theaters shut down. The company is estimated to lose $1 billion in profit just from Disneyland and Walt Disney World closures in 2020. Disney had over 100,000 employees on furlough and had to take on billions in more debt to stay solvent.
But since pandemic restrictions eased, Disney’s fortunes have rebounded sharply. The company reported revenue of $19.8 billion for the first quarter of 2022, a 22% increase over 2021’s first quarter. Profits rose by more than 36% to $1.1 billion. Disney+ subscriptions have boomed to over 130 million globally, surpassing Netflix as the top streaming service. With domestic theme parks and movies back at full speed, Disney is projecting up to $9.2 billion in profit for 2022 overall.
While still carrying high debt from the pandemic, Disney is on track to reduce leverage back to pre-pandemic levels within a few years. Between rising park income, booming streaming revenue and blockbuster films like Top Gun: Maverick dominating theaters, Disney appears well-positioned for strong financial performance going forward.
Concerns over a potential recession could impact discretionary spending on travel and entertainment. But Disney’s diversity of revenue streams and intellectual property gives it an advantage over competitors if the economy slows. While not immune from broader downturns, Disney does not seem to be facing any urgent financial crisis that could force relocating its parks for cheaper operating costs. Disney’s debt obligations also make a near-term move unlikely before they can pay down more obligations.
Is Disney Moving from Florida to Texas?
Speculation about Disney looking to move its theme parks from Florida ramped up when Disney’s new CEO Bob Chapek announced the company’s new regional campus would be located in Texas.
The campus will be built in the Lake Nona community of Orlando, Florida, with plans to relocate 2,000 high-tech and creative professional roles from across Disney’s theme parks, experiences and products division. By expanding operations in Texas, Disney may be trying to influence Florida lawmakers by showing its willingness to shift resources out of state.
But constructing a whole new Disney World with over 25 resorts and 4 theme parks from the ground up would be a massive undertaking requiring decades of work and billions in investment. Disney has already sunk over $60 billion into its Florida resort complex since the 1960s. The infrastructure in place took half a century to build.
Relocating even part of Disney World would also lose the destination’s nostalgia appeal and proximity to Florida’s cruise ship hubs. Disney recently built new attractions like Star Wars: Galactic Starcruiser designed specifically for the Orlando resort. Dismantling such a well-oiled operation would come with tremendous costs and logistical issues that likely outweigh any political incentives for Disney to move in the near future.
Why is Disney Moving Out of California?
Disneyland in California has been dubbed “The Happiest Place on Earth” since it first opened in 1955. However, Disney has made significant investments over the past decade to expand its theme park presence beyond Anaheim. The company opened Shanghai Disneyland in China in 2016 and is building additional parks across Asia.
In California, Disney has struggled with labor relations as unions have protested low wages amid soaring costs of living in Anaheim. Disneyland also faced a massive attendance drop during the pandemic with restrictions lingering longer in California. Revenue plunged by over $2 billion in 2020 compared to the prior year.
To reduce dependence on California, Disney has begun moving some operations out of the state. It shut down the Disney Vacation Club in Anaheim and announced the relocation of 2,000 jobs to Florida. In 2021, Disney even threatened to relocate Disneyland out of California over labor disputes before reaching an agreement with unions.
Expanding globally while cutting back in its home state minimizes Disney’s risk of exposure to any single market. While not outright abandoning California yet, Disney is showing a greater willingness to invest elsewhere if conditions get less favorable in its long-time home. Building up parks worldwide also lets Disney attract international audiences and reduce over-reliance on domestic traffic.
Is Disney Declining or Growing?
Far from declining, Disney has experienced tremendous growth over the past five years across its major business segments. Total annual revenues rose from $55.1 billion in 2018 to $67.4 billion in 2021, an increase of 22%. Disney has continued expanding globally with new theme park attractions, hotels and cruise ships coming online. The company also acquired 21st Century Fox in 2019, adding valuable intellectual property and content libraries under its umbrella.
Most significantly, Disney launched its Disney+ streaming service at the end of 2019. It has quickly become a juggernaut in the direct-to-consumer space, amassing over 130 million paid subscribers worldwide. Disney+ contributed over $4 billion in revenues in 2021, providing a major new avenue of growth. Parks and filmed entertainment still deliver the lion’s share of income, but streaming looks to play an increasingly vital role moving forward.
Between growing parks attendance, domination of the box office, the explosion of streaming and increased synergies across its business divisions, Disney appears poised for continued expansion. Consumers fascinated with Disney’s magical brand of storytelling and experiences show no signs of fatigue. As long as Disney can retain its creative edge and continue innovating new attractions worldwide, the company should have room to grow for many years ahead.
Is Disney World Losing Money in 2023?
Disney World set new financial records in 2022 as theme park attendance rebounded fully from the COVID-19 pandemic. Revenue rose past $6 billion for Walt Disney World Resort and its four theme parks, and per-guest spending reached all-time highs. With domestic travel booming again post-pandemic, 2023 was forecast to continue this momentum.
But early signals in 2023 indicate some potential stalling ahead. Disney announced it would cut some seasonal jobs and not fill other open roles as part of an effort to reduce costs. Hotel bookings have also softened year-over-year, signaling lower occupancy rates may be coming. Management did not disclose the exact reasons behind the slowdown.
Rising inflation and cost-of-living pressures may be reducing low and middle-income consumer demand. Airfares and gasoline prices spiked over 30% in 2022 which can deter more budget-conscious households from traveling to Orlando. A potential recession could also make households cut back on discretionary trips.
Internationally, the strong dollar may make Walt Disney World seem more expensive for key foreign markets like the UK and Canada which supply about a fifth of Disney World’s visitors. Ongoing travel restrictions in China also eliminate a major source of parkgoers. Casting some doubt moving forward, Disney has not provided any 2023 guidance yet for its parks division.
While still immensely profitable and successful, Disney World faces some gathering storm clouds after two years of soaring growth out of the pandemic. A moderate pullback in 2023 may motivate Disney to rethink expansion plans and focus on engaging its loyal fan base. But the resort remains a massive moneymaker overall for the company.
How Far in Debt is Disney?
Disney took on sizable debt to finance acquisitions and expand its streaming content to compete with Netflix. At the end of 2021, Disney’s long-term debt stood at $46.2 billion. The company spent over $71 billion taking full control of Hulu and acquiring 21st Century Fox in recent years. It also poured investment into original content for Disney+ and other streaming platforms.
This left Disney with nearly $52 billion in total liabilities at the close of 2021. The debt ballooned from under $18 billion in 2018 before the Fox deal and the launch of Disney+. However, with parks and filmed entertainment rebounding post-pandemic, Disney generated a record $9.8 billion in free cash flow for 2022.
Disney plans to use rising profits to pay down debt and restore its balance sheet over the next few years. The company announced suspending share repurchases in 2022 to divert $6 billion towards debt reduction. Its leverage ratio already improved from 3.8 in 2021 to under 3 as of mid-2022. With streaming subscriptions booming and park attendance still strong, Disney appears capable of servicing its debt while continuing to invest in new content and experiences.
Is Disney Going into More Debt?
Disney took on substantial debt loads in recent years to finance mergers and acquisitions, stock buybacks and developing streaming content. Total long-term debt ballooned from around $17 billion in 2018 to over $46 billion by 2021. This raised concerns over whether Disney was overly leveraged, especially as pandemic closures put pressure on profitability.
However, Disney has pivoted since 2022 towards generating positive free cash flow and paying down obligations. The company suspended share repurchases to redirect $6 billion towards debt repayment just in 2022. Disney also restructured operations to drive more efficiencies in staffing, marketing spending and technology costs across its streaming and other divisions.
With parks rebounding and hit franchises like Marvel and Star Wars driving streaming growth, Disney achieved record revenue and profitability in late 2022. Management plans to continue using rising income streams to reduce debt and improve Disney’s balance sheet strength over the next several years.
While Disney will still incur some debt financing major new attractions and infrastructure, the focus has shifted towards building up cash reserves and dialing back leverage. Unless conditions deteriorate, Disney seems unlikely to pile on significantly more debt obligations moving forward. The company appears committed to rightsizing its capital structure post-pandemic.
Is Disney Done with Layoffs?
The Walt Disney Company went through several major rounds of layoffs across its corporate, parks, and experience divisions during the pandemic as profits plunged. Tens of thousands of workers were impacted by restructurings, furloughs and layoffs in 2020 and 2021 designed to cut costs.
Now with business results improving, Disney initially halted job cuts in late 2022. But in early 2023, Disney again announced plans to cut some seasonal roles and leave various other positions unfilled. The move aims to drive more operating efficiencies, though on a much smaller scale than past pandemic layoffs.
Certain business units like streaming remain under pressure to rein in expenses as subscriber growth slows. Disney+ added just under 12 million subscribers in Q4 2022, down from recent quarters. With economic concerns looming, Disney may turn to more job cuts selectively to protect profitability.
However, huge layoff programs like those seen during COVID seem unlikely going forward. The worst effects of the pandemic downturn have passed. Disney World and other parks are buzzing with activity again. Layoffs may pop up surgically in targeted business units like streaming. But massive across-the-board job cuts at Disney’s scale are probably over for the time being, barring any severe recession.
What Percent of Florida’s Income is from Disney?
Walt Disney World Resort generates massive economic benefits for Florida. By one estimate from the University of Florida, Disney accounts for over 4% of Florida’s total GDP. That equates to around $5.8 billion in statewide economic impact from Disney.
Beyond direct Disney employee spending, the resort supports tens of thousands of additional tourism jobs throughout Central Florida. An estimated 75 million visitors come to the region annually primarily to visit Disney World and other Orlando theme parks. This drives wide-ranging business activity from hotels to restaurants that employ hundreds of thousands.
Along with indirect tourism stimulus, Disney World and its entities directly pay over $780 million in state and local annual taxes. Disney also shoulders the tax burden for providing essential services like utilities and infrastructure on its 40 square-mile property.
Considering direct GDP contribution, employment, tax payments, and tourism draw, Disney World supports between 2.5%-5% of total economic activity in Florida by varying estimates. Replacing that massive economic engine would be hugely challenging if Disney ever left the state. For now, both Disney and Florida have incentive to repair their relationship given how intertwined their futures remain.
Is It Cheaper to Go to Disney World If You Live in Florida?
Floridians do enjoy certain advantages when visiting Walt Disney World thanks to their resident status. One popular perk is discounted multi-day tickets only available to Florida residents. For instance, a 4-day “Disney Magic Flex Ticket” costs $349 for adults and $325 for children if you live in Florida, compared to standard prices up to $570 depending on season.
Florida residents can also purchase an annual pass to access the parks year-round at lower rates than tourists. The “Disney Incredi-Pass” provides unlimited visits for $1299 per year for Florida residents, versus $1599 for non-residents. Room discounts at Disney Resort Hotels are also typically offered for Florida residents during slower seasons.
Beyond tickets and hotels, Florida residents have the advantage of proximity when they want a short getaway to Disney World. They can avoid flight costs and some vacation time from work. Living close by also lets locals go for just part of a day to visit certain attractions. While not hugely cheaper, Florida residents do have lower costs and more flexibility to visit Disney World compared to tourists flying in.
Will Disney Relocate You If Your Job Moves?
Disney has a long tradition of taking care of cast members and employees at its parks and resorts. If an employee’s role moves to another physical location, Disney typically offers several options. One is direct relocation – Disney may provide moving assistance and help with home purchase or rental arrangements in the new location.
For cast members unable or unwilling to relocate, Disney tries placing them in a suitable new role at their current location. The company has operations spanning enough geographic zones that internal transfers are often possible. Layoffs are generally a last resort if no alternatives exist.
Employees report Disney handles major transitions like office closures or relocations gradually and in close communication with workers. The company aims to minimize disruptions through compensation, retention bonuses or helping staff find new opportunities internally. While not flawless, Disney strives to ensure employees are taken care of during big changes.
Is Disney Closing in California and Moving to Florida?
As Disney expands its theme park footprint worldwide, the importance of Disneyland California has naturally diminished some. But rumors of Disneyland closing down or moving out of California are not accurate. The Anaheim theme park just celebrated its 67th anniversary and remains a major profit center for Disney.
It’s true Disney has invested heavily in building up Walt Disney World in Florida in recent decades. Four theme parks now make up Disney World versus just two at Disneyland Resort. But the California park still drew over 15 million guests in 2022 and represented about 20% of Disney’s total parks income. With a $310 million makeover of Paradise Pier underway, Disney is still putting big money into the original park.
While Disney has moved some operations out of California, fully shutting down Disneyland would forfeit billions in revenues and abandon a legacy brand. Disney is more likely to keep expanding in both Florida and California while adding new parks overseas. Disneyland also has advantages in proximity to the film studio creative teams and California’s supply of entertainment talent. For now, it remains an irreplaceable anchor of Disney’s empire.
Is Disney Still a Good Long-Term Investment?
Disney stock struggled in 2022, dropping over 37% on concerns over slowing subscriber growth at Disney+ and the economic challenges ahead. However, the media giant still looks well positioned for the long run due to its wide moat and intellectual property.
Disney owns some of the world’s most lucrative entertainment brands, including Marvel, Pixar, Star Wars, and its classic animated characters. These powerful franchises fuel massive box office receipts, merchandise sales, and theme park attractions. Disney continually releases new movies and shows from these franchises to drive profitability.
The company’s robust content pipeline should support streaming subscriber growth long-term despite some near-term slowdowns. Disney plans to spend over $30 billion on new content in 2023 to stay competitive in streaming. Its upcoming titles like Avatar: The Way of Water, Ant-Man and The Wasp: Quantumania, and The Mandalorian Season 3 should attract viewers.
Disney’s global theme park footprint also gives it an advantage. Its parks business proved resilient, achieving record profitability in 2022 as attendance rebounded post-pandemic. Disney is expanding with new attractions overseas and recently raised domestic ticket prices. There appears to be pent-up demand to visit Disney’s unique in-person experiences.
While Disney carries more debt than ideal currently, its cash flows are strong enough to continue paying down obligations. Disney generated $9.8 billion in free cash flow in 2022, giving it flexibility to keep investing. The company expects to restore its balance sheet in the next few years.
Given these strengths, most analysts rate Disney stock as a long-term “buy” still. The average 12-month price target of $119 per share implies a 44% upside. Despite some macroeconomic concerns, Disney’s brands retain tremendous value that should continue to reward investors over time. The company seems likely to remain a dominant force in entertainment for decades to come.
What Will Happen to Disney in 2024?
Looking ahead, analysts expect Disney to regain its growth trajectory in 2024 after a mixed 2023. Several positive developments could boost Disney’s various divisions next year:
- Parks and Experiences: Continued reopening of international parks and travel rebound will drive higher attendance and per-guest spending. Domestic pricing power also remains strong.
- Streaming: Declining subscriber additions will stabilize in 2024 after price hikes and a stronger content pipeline. Disney+ growth in international markets also remains robust.
- Movies: Big blockbuster releases like The Little Mermaid, Indiana Jones 5 and elements in the Marvel/Avatar pipelines will spur box office growth.
- Consumer Products: Merchandise sales should pop with theatrical hit movies, theme park expansions, and new toy lines around Disney properties.
- Advertising: Disney will benefit from strengthening ad spend across its digital/linear media properties as macro conditions improve.
Overall, analysts consensus forecast Disney’s revenues climbing 12% in 2024 to $75.1 billion as all major business segments rebound. Profits are projected to improve by 18% to $9.55 per share. The company appears to have accelerated growth as post-pandemic conditions stabilize.
Why is Disney’s Attendance Down?
Disney’s theme parks division saw steep declines in attendance throughout 2020 and much of 2021 due to COVID-19-related closures and restrictions. The company estimated losing around 110 million park visits globally during 2020 compared to pre-pandemic levels. Disneyland in California faced extended shutdowns lasting over a year.
Travel restrictions in Asia have also severely limited international guest visits. This was especially pronounced early in the pandemic. But even as domestic parks have reopened fully, Disney is still seeing reduced traffic from key overseas markets like China that have maintained COVID entry requirements.
During parts of 2022, Disney also reduced capacity limits and paused certain offerings like fireworks shows temporarily to reduce crowding. This controlled visitor volume by design for a period. Stricter vaccine requirements may have also deferred some guests last year.
Rising inflation, airfare costs, and economic uncertainty in 2023 could further dampen consumer discretionary spending on theme park trips moving forward. Between pandemic impacts and macroeconomic challenges, Disney may see attendance plateau somewhat below its pre-COVID highs for the next couple of years.
Is Disney Losing Viewers?
Disney made streaming the centerpiece of its growth strategy in recent years. But after explosive subscriber gains early on, Disney+ saw its momentum slow in 2022. The service added just 12 million subscribers in Q4 2022, down over 60% year-over-year. Slowing growth has raised worries Disney may be losing streaming viewership momentum.
However, Disney still owns four of the top five streaming services Disney+, Hulu, ESPN+, and Star+. Combined, they exceeded 235 million subscriptions globally as of late 2022. Consumers appear to be reaching a saturation point by adding more streaming apps after a boom during the pandemic.
Rising prices and account-sharing crackdowns have also stunted Disney+’s growth. But the company is banking on its robust pipeline of original franchises like Marvel and Star Wars to keep audiences engaged long-term. Hits like Andor attracted strong viewership despite economic challenges in late 2022.
With parks and films rebounding too, Disney has many ways to drive profit growth beyond streaming alone. Movie blockbusters and destination experiences remain key pillars of the business. Disney still dominates entertainment media overall even as streaming subscriber gains normalize from an unprecedented surge.
What is the Future Outlook for Disney?
After navigating some pandemic disruptions and streaming slowdowns recently, Disney appears poised for a stronger future. The company is projecting total revenue growth of 7-9% annually through 2024, implying it sees recovery ahead.
Several trends point towards Disney restoring steady growth:
- Continued reopening of international theme parks and travel bouncing back
- Upcoming slates of blockbuster movie releases from Marvel, Pixar, etc.
- Stabilizing streaming subscriptions as new markets expand
- Higher advertising revenue amid economic rebound
- Retail, games, and experiences driving consumer products
With over $30 billion budgeted for new content in 2023, Disney is going all-in on franchises to build out its entertainment ecosystem. Combined with higher park capacity, rising moviegoing, and stabilization in streaming, Disney’s growth outlook seems reassuring. Challenges remain with inflation and debt obligations. But the company looks capable of mid-high single-digit revenue and profit growth in the years ahead.
Is Disney Losing Its Touch?
Disney experienced some rare box office misses in 2022 with films like Strange World and Amsterdam flopping. Coupled with Disney+ subscriber growth slowing, it led some to wonder if Disney is losing its creative edge.
But looking at the bigger picture, Disney remains a cultural phenomenon. Its latest Marvel entries like Black Panther: Wakanda Forever and Ant-Man and The Wasp: Quantumania opened huge. Animated hits like Encanto show Disney’s storytelling still resonates widely. Unscripted series’ like The Kardashians and Dancing with the Stars continue dominating ratings on Disney’s TV networks.
The success of Star Wars: Galactic Starcruiser and themed attractions like TRON Lightcycle Run prove Disney’s immersive experiences still draw crowds. And merchandise sales around characters like Mickey Mouse remain robust. With Steamlone Mickey shorts drawing over 200 million YouTube views, classic Disney IP clearly still captivates fans.
No media company consistently hits home runs, and Disney faces pressure to refresh some aging franchises. But early reactions to titles like Hocus Pocus 2 and The Mandalorian season 3 are promising. Disney still employs thousands of top creative minds to develop new stories. With its outstanding track record, betting against Disney’s continued cultural relevancy seems unwise.
Is Colorado Getting a Disneyland?
Rumors have circulated for decades that Disney may build a new Disneyland-style theme park near Denver, Colorado. Speculation resurfaced recently when Disney was scouting land around the city of Aurora. However, the company has no official plans for a full-scale Disney park in Colorado.
Disney does operate a small seasonal pop-up shop in Aurora to showcase merchandise. Land surveys in the area are also likely routine for possible future retail locations or offices. The high costs and infrastructure involved with building a new Disneyland make such a major expansion unlikely in the near term.
If Disney did pursue a Colorado theme park, it would take 5-10 years to construct at minimum. The company is more focused now on international expansion in Asia and restoring its original California and Florida parks post-pandemic. Any future new U.S. theme park would likely be built elsewhere. Though a Disneyland in Colorado remains possible someday, no concrete moves are imminent despite rumors.
Where Was Disney’s America Going To Be?
In the early 1990s, Disney proposed an ambitious new history-themed park called Disney’s America to be built in Haymarket, Virginia. The massive project would have included 9 different themed lands exploring various eras of American history, such as an Industrial Revolution zone and a native American village.
The park was set to be constructed 25 miles from Washington D.C. to attract area tourists. But Disney faced problems securing infrastructure improvements needed to support such a large complex in rural northern Virginia. After economic feasibility studies, Disney canceled the project in 1994 due to budget concerns.
Though never built, Disney’s America represented then-CEO Michael Eisner’s vision to bring immersive storytelling about U.S. history to life. The concept aimed to combine education with Disney’s theme park mastery. Other CEOs later revived similar ideas with plans for history parks in Virginia, but none came to fruition.
Over 25 years later, some Virginians still express nostalgia for the lost opportunity of Disney building a major resort complex that could have spurred regional tourism. Though ultimately impractical at the time, Disney’s America represented the ambitious scale of projects the company dreamed up at its creative peak.