<![CDATA[Mouse Money]]>https://substack.mousemoney.cohttps://substackcdn.com/image/fetch/$s_!FVV7!,w_256,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2F8659bd24-9ffc-40a0-901d-69427292a402_512x512.pngMouse Moneyhttps://substack.mousemoney.coSubstackThu, 12 Nov 2026 00:32:36 GMT<![CDATA[Disney Once Had the Worst Board in America. Nvidia Should Study What Happened Next.]]>https://substack.mousemoney.co/p/disney-once-had-the-worst-board-inhttps://substack.mousemoney.co/p/disney-once-had-the-worst-board-inWed, 11 Nov 2026 15:36:37 GMT
Mouse Money cover. Disney in 1997, Nvidia in 2026: what makes a board independent? In March 2004, shareholders withheld 45.2% of votes from Michael Eisner, and the board took his chairman title that day. At Nvidia in 2026, 10 of 11 directors are independent under Nasdaq rules, and those directors have served an estimated 14.8 years on average, against 7.9 for the S&P 500.

In December 1997, BusinessWeek ranked Disney’s directors the worst board in America. Michael Eisner, the chairman and chief executive, had an answer. Disney’s shares had returned more than 20% a year for a decade, and he said he had a fantastic board.

Nvidia’s directors are hearing a version of that question this month, and their defenders are giving a version of that answer. On Nov. 8 the board opened an investigation into reports involving its founder and chief executive, Jensen Huang. On Nov. 17, the same day Disney reports its results, Nvidia holds its first earnings call since then, and analysts get their first chance to question management.

The two cases are not the same, and the difference matters. Disney’s boardroom failures are documented in a court record. Nothing in the public record shows that Nvidia’s board has failed in the matters now under investigation. It is facing a major public test.

Our view: Disney’s history shows what the test is. A board shows its independence by how it handles evidence that could be unwelcome, and Nvidia’s directors added to their burden with their first statement.

What Nvidia’s board has done so far

  • News reports citing U.S. officials say an intelligence memo alleged that Alice Huang, a former executive at Nvidia customer Megaspeed, was recruited by China to gather information on Jensen Huang. The two are not related. China calls the claim groundless, and no charge has been brought.

  • On Nov. 8, Huang told employees he had been unfaithful to his wife. He did not name anyone.

  • The same day, the board said a committee of independent directors would oversee an investigation. In the same statement it said it had “confidence in Jensen and his leadership team.”

  • On Nov. 10, the independent directors said they had retained Joon H. Kim, a former acting U.S. attorney in Manhattan, and his firm, Wachtell, Lipton, Rosen & Katz.

Hiring a former federal prosecutor is a serious step. But the board has not said which directors sit on the committee, whom the lawyers report to, or whether the findings will be made public.

The board also expressed confidence in Huang as it opened the inquiry. There is a sound reason to do that. A company of Nvidia’s size cannot leave employees, customers and investors guessing about who is running it, and confidence in someone’s leadership during an inquiry is not a judgment on what the inquiry will find. But the statement raises the bar. Whatever the committee concludes, the directors will need to show their work for the conclusion to be believed.

The public record does not say what the directors knew about any of this, or when they learned it. The company described Huang’s dealings with Megaspeed as routine as recently as Oct. 29 and Nov. 6. A proposed shareholder class action filed Nov. 9 centers on those statements.

Exterior of Nvidia's headquarters building in Santa Clara, California.
Nvidia headquarters in Santa Clara, Calif. Photo: Coolcaesar, CC BY-SA 4.0, via Wikimedia Commons.

Reasons to look closely, and the other side

By the formal measure, the board is independent. Ten of 11 directors qualify under Nasdaq rules, and Huang owns 3.58% of a single class of stock, so he does not control the vote.

Critics point to features the rules do not measure. Three directors have served since 1993, the year Nvidia was founded. Independent directors have served an estimated 14.8 years on average, against 7.9 for the S&P 500. Three are billionaires from their Nvidia shares, by Bloomberg’s count. The lead independent director, Stephen Neal, is chairman emeritus of Cooley, a law firm that does legal work for the company. ISS, the proxy adviser, recommended all of Nvidia’s nominees this spring but gave its board structure its riskiest rating, The Wall Street Journal reports.

Bar chart of average tenure of independent or outside directors. Nvidia in 2026: 14.8 years, an estimate. Disney in 1997: 10.3 years, an estimate. S&P 500 in 2026: 7.9 years. Disney in 2026: 4.9 years.

None of that proves deference. Large shareholdings tie directors’ wealth to the outcome other shareholders want. Long service brings knowledge of the business and, sometimes, the standing to say no.

Nvidia has no chairman, but its proxy gives the lead director real powers. He schedules board meetings, works with Huang on the agendas, can require that risk matters be added, and runs quarterly sessions of the independent directors without Huang in the room.

The question is whether those powers work when it counts. Jill Fisch of Penn Carey Law told Semafor the board’s makeup suggests a chief executive with effective control. Director Mark Stevens told Forbes in 2024 that he thought it might be the best board in America. The investigation is a chance to find out which is closer.

What a deferential board looked like at Disney

Disney’s record is not a matter of inference. In December 1996, a year before the BusinessWeek ranking, Disney paid Michael Ovitz about $130 million to leave after 14 months as president. Eisner had recruited him.

The board included Eisner’s personal lawyer, his architect and the principal of the school his children attended. By BusinessWeek’s count, seven of 16 directors were current or former Disney executives.

Shareholders sued over the payout. In 2005 a Delaware judge cleared the directors of liability, but he wrote that Eisner had stacked the board with friends, and he put the phrases “imperial CEO” and “supine or passive board” on the record.

When Disney’s board showed it was independent

Disney’s directors did eventually act against a chief executive. Two decisions stand out, and they are not equally strong evidence.

  • March 2004. Roy E. Disney had resigned from the board on Nov. 30, 2003, and campaigned against Eisner through the winter. At the annual meeting, shareholders withheld 45.2% of their votes from Eisner, by the certified count. The same day, the board took the chairman title from him and gave it to George Mitchell, a director and former U.S. senator. Eisner left in 2005.

  • November 2022. The board removed Bob Chapek as chief executive five months after extending his contract, and brought back Bob Iger.

Table comparing three boards. Disney under Eisner, 1997 to 2004: 16 directors, 10.3 years average outside tenure (estimate), Eisner as chair until March 2004, 7 current or former executives, largest vote against a director 45.2%; in March 2004 it took Eisner’s chairman title. Nvidia, November 2026: 11 directors, 14.8 years (estimate), no chair but a lead independent director, 1 executive, three directors since 1993, largest vote against 13.3%; no public instance of acting against a CEO. Disney, November 2026: 12 directors, 4.9 years, independent chair, 2 executives, largest vote against 6.9%; the board removed Bob Chapek in November 2022, and its membership has changed since.

The 2004 decision came only after an extraordinary shareholder vote. It still counts. The directors reached a conclusion their chief executive did not want, and acted on it.

The 2022 decision is weaker evidence. Removing Chapek showed the board could dismiss a chief executive, though it was reversing its own choice of successor. Bringing back Iger, who had run the company for 15 years, showed how much it still leaned on one dominant leader. Being able to remove a chief executive is not the same as being able to build a succession that lasts. In between, in 2012, the board had given Iger the chairman title as well.

Disney has since rebuilt the structure. James Gorman, who ran succession at Morgan Stanley, became independent chairman in January 2025. The board unanimously named Josh D’Amaro chief executive in February, and outside directors now average 4.9 years of service. It is too early to call that succession a success. What Disney’s record does show is that a board once ranked the worst in America later reached a conclusion its chief executive did not want.

What returns can and cannot tell you

Eisner’s defense was his stock price. Nvidia’s is stronger. By the company’s proxy, $100 invested at the end of fiscal 2021 was worth $1,445.67 five years later.

Returns reflect many things: the product, the market, the chief executive, luck. They cannot isolate the quality of oversight. Disney’s shares returned more than 20% a year in the decade that ended with the Ovitz payout. And Disney’s shares trailed its peers over the five fiscal years through 2025, a period that included the Chapek decision and a rebuilt board. Good governance does not guarantee good returns, and good returns do not show that anyone is watching.

They can make watching harder. Directors who have seen a chief executive create that much wealth, including their own, have every reason to give him the benefit of the doubt.

What would show independence

On the Nov. 17 call, listen for whether Huang takes questions on the investigation and whether any director speaks. Disney reports that morning, in Josh D’Amaro’s first full-year call as chief executive.

After that, the tests are about conduct. Independence does not mean opposing the chief executive. It means being free to reach an unwelcome conclusion if the evidence leads there. A board could investigate thoroughly and reasonably keep Huang in place. It could also appoint a chairman and change nothing.

  • Access to evidence. Whether Kim and Wachtell get the documents and the people they ask for.

  • Freedom from interference. Whether the committee’s members are named, and whether the lawyers report to the committee alone and not to management.

  • Credible findings. Whether shareholders see what was examined and what was found, or only a conclusion.

  • Action that fits the findings. Whether what the board does next follows from the evidence, whichever way it points.

No single item would settle the matter. Together they would be evidence.

More than six years passed between the worst-board ranking and the day Disney’s directors took Eisner’s title. Nvidia’s directors face the same question on a much shorter clock: are they free to reach a conclusion their celebrated chief executive would not welcome, if that is where the evidence leads?

A board can look independent on paper and still lack the will to challenge its chief executive. Disney’s experience shows how costly that deference can be for a company and its shareholders. Whether Nvidia’s board proves independent in practice remains to be seen.

If this was forwarded to you, subscribe to get our Nov. 17 breakdown of Disney’s results.

A note on the numbers

  • Tenure averages for Nvidia and for Eisner’s board are our estimates from proxy data.

  • The 2004 withhold vote was announced as about 43% and certified at 45.2%.

  • The Ovitz severance is the Delaware Supreme Court’s figure.

  • Return figures come from each company’s own proxy. The periods and peer groups differ, so we do not compare the two companies directly. Disney’s proxy shows $100 becoming $94.13 over fiscal 2021 to 2025, against $224.99 for its peers.

  • The intelligence claims are allegations from news reports citing officials. Nothing here shows wrongdoing by any Nvidia director.

Sources

]]><![CDATA[More Hasn’t Meant More for Disney’s Movies]]>https://substack.mousemoney.co/p/more-hasnt-meant-more-for-disneyshttps://substack.mousemoney.co/p/more-hasnt-meant-more-for-disneysMon, 09 Nov 2026 16:14:54 GMT
Mouse Money cover: Beauty and the Beast at 35. More hasn't meant more. In today's dollars, Beauty and the Beast has drawn $5.1 billion in box office and stage revenue since 1991, on a reported budget of $62 million or less. The 11 Disney and Pixar originals released since 2020 grossed $2.07 billion combined; Zootopia 2 alone made $1.87 billion. The live-action Moana grossed $324 million worldwide on a reported $250 million budget; Moana 2 made $1.06 billion. Figures other than Beauty and the Beast's are nominal.

Disney released Beauty and the Beast 35 years ago this month. It has been finding new ways to sell it ever since.

In today’s dollars, the animated film cost about $37 million to $62 million to make, based on a reported budget of $15 million to $25 million, and has taken in about $1 billion at the box office worldwide, counting rereleases. It was the first animated feature nominated for the best-picture Oscar. A stage version opened at a Disney theme park the day the film went into wide release, and the Broadway production that followed ran 13 years. The 2017 live-action remake grossed $1.74 billion in today’s dollars. Disney Theatrical and its touring partners said in 2014 that licensed stage productions had generated more than $1.7 billion, at least $2.4 billion today. All told, the story has drawn at least $5.1 billion in today’s dollars at the box office and on stage. Disney is still selling it: a limited run of 4,600 Belle dolls goes on sale Nov. 13.

Beauty and the Beast came out of a studio that released one animated feature a year at most, and many of the films from that stretch are still earning. Disney now makes far more: more animated features, more live-action remakes and, during the streaming push, a flood of series for Disney+. The record since has been spotty. Sequels to older hits are carrying the box office, while new originals and remakes mostly are not. Disney has already told investors that its live-action Moana, which grossed $324 million on a reported $250 million budget, will weigh on the Entertainment results it reports Nov. 17.

At 35, Beauty and the Beast is a reminder that more hasn’t meant more.

One film at a time

Walt Disney Animation Studios’ official filmography lists five features in the 1980s and nine in the 1990s, never more than one in a year. From The Little Mermaid in 1989 through Tarzan in 1999, the studio released about one film a year.

Each film got the company’s full attention, including a willingness to start over. In 1989, Jeffrey Katzenberg, then chairman of Disney’s film studio, watched the early storyboard reels for Beauty and the Beast, ordered the film scrapped and had it started again from scratch. First-time feature directors Kirk Wise and Gary Trousdale took over. Lyricist Howard Ashman, who had been developing Aladdin with composer Alan Menken, reluctantly joined to write the songs.

Artwork for Disney's Beauty and the Beast showing Belle and the Beast with Mrs. Potts, Chip, Lumiere and Cogsworth.
Beauty and the Beast (1991). Image: Disney

That decision to absorb the cost of a restart is still paying off.

Exhibit 1: A film that cost a reported $62 million or less has drawn at least $5.1 billion. Beauty and the Beast's box office and stage revenue since 1991, in September 2026 dollars. Production budget: $37 million to $62 million, from a reported $15 million to $25 million. Original worldwide run, 1991-92: $797 million to $854 million. IMAX and 3D reissues in 2002, 2010 and 2012: $171 million. Licensed stage shows since 2004, by Disney's 2014 tally: over $2.4 billion. Live-action remake, 2017: $1.74 billion. Both films plus stage: at least $5.1 billion. In nominal dollars, the total is at least $3.4 billion. A timeline below shows the story turning up across the company: a stage show at Disney-MGM Studios on the day of wide release in 1991; Broadway in 1994, which grossed $429 million over 13 years; the Disney Princess line launching at $300 million in retail sales in 2000; Be Our Guest opening in New Fantasyland in 2012; Tokyo Disneyland's roughly 75 billion yen expansion in 2020; and limited-run anniversary dolls, with no reissue announced, in 2026.

The rest of the decade did the same. Five of its films, Beauty and the Beast, The Lion King, The Little Mermaid, Tarzan and Aladdin, became Broadway musicals that have grossed $3.58 billion on Broadway alone, close to the $3.88 billion that the 10 films of the period known as the Disney Renaissance took in at the box office. Four of those five came back as live-action remakes; The Lion King’s grossed $1.66 billion in 2019. Not every film worked: The Rescuers Down Under made $47 million. But the hits kept paying long after release. By Mouse Money’s count of ticket sales, stage grosses and published merchandise figures, The Lion King is Disney’s biggest film franchise, at $23.4 billion in today’s dollars, and about three-quarters of that has come from the stage.

Exhibit 2: Tickets are a quarter or less of the spending on Disney's top five franchises. Documented spending on movie tickets, stage shows and merchandise for Disney-brand film franchises, in September 2026 dollars, from the Mouse Money franchise ledger. 1. The Lion King, 1994 and 2019 films: $23.4 billion, of which tickets $4.3 billion (18%), stage shows $17.4 billion and merchandise $1.7 billion. 2. Cars, three films: $22.2 billion; tickets $2.2 billion (10%), merchandise $20.0 billion. 3. Toy Story, four films: $19.6 billion; tickets $4.9 billion (25%), merchandise $14.8 billion. 4. Lilo & Stitch, 2002 and 2025 films: $8.6 billion; tickets $1.6 billion (19%), merchandise $7.0 billion. 5. Winnie the Pooh, six films: $8.5 billion; tickets $0.7 billion (9%), merchandise $7.8 billion. For comparison, Beauty and the Beast ranks eighth at $5.8 billion: tickets $2.8 billion (48%) and stage $3.1 billion, with no merchandise figure. Merchandise counts only years with published figures, so totals are incomplete; this is consumer spending, not Disney revenue.

A spotty record since

The biggest films of recent years have gone back to worlds audiences already knew. Inside Out 2 grossed $1.70 billion, Zootopia 2 $1.87 billion, Toy Story 5 $1.15 billion and Moana 2 $1.06 billion. After inflation, three of the five biggest Disney-brand films ever are a remake or a sequel, and the top two both belong to The Lion King, a story Disney first told in 1994.

Exhibit 3: Three of the five biggest Disney-brand films returned to a world audiences already knew. Worldwide box office in September 2026 dollars for Walt Disney Animation, Pixar and Disney live-action films. 1. The Lion King (2019), a remake: $2.19 billion ($1.66 billion unadjusted). 2. The Lion King (1994), an original: $2.07 billion ($979 million unadjusted). 3. Zootopia 2 (2025), a sequel: $1.96 billion ($1.87 billion unadjusted). 4. Frozen II (2019), a sequel: $1.92 billion ($1.45 billion unadjusted). 5. Frozen (2013), an original: $1.87 billion ($1.31 billion unadjusted). Next is Inside Out 2 (2024) at $1.82 billion. Excludes Marvel, Star Wars and Avatar films and classics released before 1980.

New stories have had a much harder time. The 11 original features that Walt Disney Animation and Pixar have released since 2020 grossed $2.07 billion worldwide combined, barely more than Zootopia 2 made by itself. None has reached $500 million. Pixar’s Elemental came closest at $496 million, and last year’s Elio made about $154 million.

Exhibit 4: No Disney or Pixar original since Coco has reached $500 million. A scatter chart of worldwide box office for each Walt Disney Animation and Pixar feature, showing the 2010-2017 originals and every release since 2020, with a dashed line at $500 million. Revival originals including Frozen ($1.28 billion), Zootopia ($1.03 billion) and Coco ($815 million) sit above the line. No original released since 2020 reaches it: Elemental comes closest at $496 million, Hoppers made $390 million and Encanto $257 million. The sequels Inside Out 2 ($1.70 billion), Zootopia 2 ($1.87 billion), Toy Story 5 ($1.15 billion) and Moana 2 ($1.06 billion) sit far above. Totals: 10 originals from 2010 to 2017 grossed $7.22 billion on $1.76 billion of budgets, 4.1 times; 11 originals from 2020 to 2026 grossed $2.07 billion on $1.83 billion, 1.1 times; 4 sequels from 2024 to 2026 grossed $5.78 billion on $0.75 billion, 7.7 times.

The financial swings are large. Deadline’s annual estimates of film profits, which count production, marketing and later revenue, put Strange World’s loss at $197 million, Wish’s at $131 million and the Toy Story spinoff Lightyear’s at $106 million. Those three losses, $434 million in all, equal two-thirds of the $650 million profit Deadline estimated for Inside Out 2 in 2024. These are outside estimates for selected films, not Disney’s accounts, but they show how much expensive misses take back from the best films.

There are bright spots. Encanto found a big audience on Disney+ and is getting an Animal Kingdom attraction. Hoppers, Pixar’s March release, has made $390 million on a $150 million budget. And it is early: Beauty and the Beast took three years to reach Broadway.

The remakes, which turned the 1990s classics into a second round of billion-dollar hits, are losing steam. The six wide releases since 2021 have averaged $516 million worldwide, against $729 million for the 12 released from 2010 through 2019, a 45% drop after inflation. This summer’s live-action Moana opened about 19 months after the animated sequel and took in about $324 million on a reported $250 million budget; Moana 2 had made $1.06 billion on a reported $150 million. In its August shareholder letter, Disney said the remake fell short of its box-office expectations and would weigh on fourth-quarter Entertainment results.

Exhibit 5: Disney's remakes now gross 45% less than in the 2010s, after inflation. Worldwide gross and reported budget for each of Disney's 18 wide-release live-action remakes since 2010, by our count, nominal dollars. The 12 released from 2010 to 2019 averaged $729 million, 4.6 times their budgets, led by The Lion King at $1.66 billion, Beauty and the Beast at $1.27 billion, Aladdin at $1.05 billion and Alice in Wonderland at $1.03 billion. The six released from 2021 to 2026 averaged $516 million, 2.7 times their budgets, or 1.9 times without Lilo & Stitch, which made $1.04 billion on $100 million. Snow White made $206 million on $270 million, 0.8 times, and the live-action Moana made $324 million on $250 million, 1.3 times.

Disney made more

The bigger change is how much Disney asks of itself at once. In the 1990s, Walt Disney Animation released nine features and Pixar three. From 2020 through this year, the two studios have released 16, and Disney has added nine live-action remakes and spinoffs of its animated films. During the streaming push, Marvel and Star Wars put five live-action series seasons a year on Disney+ in 2021 and 2022, and cash spending on content reached $30 billion in fiscal 2022.

Bob Iger, back as chief executive at the time, delivered a verdict at the New York Times DealBook Summit in November 2023: “Quantity, in our case, diluted quality.” He was discussing Marvel. On the May 2025 earnings call, he went further: “We’ve also learned over time that quantity does not necessarily beget quality,” he said, describing Disney’s “zeal to flood our streaming platform with more content.”

Exhibit 6: Disney flooded its own channels, then pulled back. Total content spending by fiscal year, by Disney's measure, whose plans and guidance include sports: about $25 billion in 2021, $30 billion in 2022, about $27 billion in 2023, a $25 billion plan for 2024, $23 billion in 2025 and $24 billion guidance for 2026. Live-action Marvel and Star Wars seasons released on Disney+: 1 in 2019, 1 in 2020, 5 in 2021, 5 in 2022, 4 in 2023, 4 in 2024, 3 in 2025 and 3 in 2026 through Nov. 9. Two quotes from Bob Iger: Quantity, in our case, diluted quality (DealBook Summit, Nov. 29, 2023), and we've also learned over time that quantity does not necessarily beget quality (earnings call, May 7, 2025).

The argument has limits. Walt Disney Animation itself still releases about one feature a year; the crowding is across Disney’s studios, its remake slate and its streaming service. The pandemic sent several films straight to Disney+, and U.S. and Canadian theaters sold 37% fewer tickets in 2025 than in 2019, by The Numbers’ count, which makes it harder for any unfamiliar title to break out. Iger’s admission does not explain why any single film failed.

Give the next classic room

Protecting quality pays more at Disney than at most studios, because one film can feed so many other businesses. The audience that falls in love with a story is the start of the stage shows, toys and rides that follow. A release date has no such earning power.

That should shape decisions long before a film reaches theaters. A story that isn’t working may need a rewrite, a new team, a smaller budget or more time. A sequel or remake that isn’t convincing should be canceled even when the franchise is popular. And Disney needs room for originals, because today’s profitable sequels depend on characters someone once took a chance on creating.

The next tests come quickly. Walt Disney Animation’s Hexed, its first original since Wish, opens Nov. 25, and Pixar’s Gatto follows in March.

What we’re watching

  • Nov. 17: Disney’s fiscal fourth-quarter results, including how much Moana weighed on Entertainment, and any guidance on next year’s content spending.

  • Nov. 22: The 35th anniversary of Beauty and the Beast’s wide release.

  • Nov. 25: Hexed opens in U.S. theaters.

  • March 5, 2027: Pixar’s Gatto opens.

  • Nov. 24, 2027: Frozen III, the next sequel to a hit from the 2010s.

What would change our view

If Hexed or Gatto breaks out and starts a franchise while Disney keeps its current pace, volume wasn’t the problem, and Disney can make more without getting less.

Thirty-five years on, Disney is still selling a story its filmmakers were willing to start over. That is the standard its next release should meet, even if meeting it means waiting.

If this was forwarded to you, subscribe to Mouse Money for our Nov. 17 breakdown of Disney’s results.

A note on the numbers

Figures were checked Nov. 9, 2026. Release counts come from Walt Disney Animation Studios’ official filmography and Pixar’s film list; the 2020-2026 count runs through Toy Story 5 and includes films released straight to Disney+. Box-office figures are worldwide ticket sales in nominal dollars unless noted; they are not Disney revenue or profit. The Numbers supplies most film grosses and reported production budgets, which exclude marketing; Box Office Mojo supplies the 2017 Beauty and the Beast gross. Profit and loss figures are Deadline’s estimates, not Disney’s accounts. Inflation adjustments use the Bureau of Labor Statistics’ consumer price index, in September 2026 dollars, with each release at its own year’s prices. Beauty and the Beast’s $5.1 billion counts Disney’s 2014 stage figure at 2014 prices, so it is a floor; the franchise ledger, which spreads that figure over 1994 through 2014, puts the film’s tickets and stage revenue at $5.8 billion. Franchise totals and the inflation-adjusted film ranking come from Mouse Money’s franchise ledger, in September 2026 dollars; its merchandise figures cover only years with published data, so those totals are incomplete. Remake averages cover wide theatrical releases. Selected examples illustrate the economics but do not prove that releasing fewer films causes better ones.

Sources

]]><![CDATA[Disney’s Layoffs Were a Long Time Coming]]>https://substack.mousemoney.co/p/disneys-layoffs-were-a-long-timehttps://substack.mousemoney.co/p/disneys-layoffs-were-a-long-timeWed, 04 Nov 2026 17:58:39 GMT
Mouse Money cover: Disney's layoffs were a long time coming. The TV business: operating income at Disney's TV networks, excluding ESPN, fell 43% from fiscal 2022 to 2025, partly because Disney moved Star India into a joint venture. The studio: Disney's film and TV sales and licensing earned a 4.6% profit margin in fiscal 2025. The overhead: Disney's selling, general and administrative costs were $16.5 billion in fiscal 2025, above 2022's level.

In January 2023, Nelson Peltz’s Trian Fund Management published a slide deck arguing that Disney had let its costs get away from it. Disney’s selling, general and administrative costs, which include marketing, had risen 85% in four years, to $16.4 billion in fiscal 2022, and Trian said it believed Disney “has never thoroughly reviewed its cost structure.” Four weeks later, Bob Iger announced 7,000 job cuts and a plan to save $5.5 billion a year, about $2.5 billion of it from what Disney called “non-content-related expenses (SG&A and other operating costs).” Trian called the moves “a win for all shareholders” and ended its proxy fight the next day.

Those costs are now higher than they were when Peltz complained. Disney’s selling, general and administrative costs reached $16.5 billion in fiscal 2025, and it employed about 231,000 people, more than in 2022. On Monday evening, Bloomberg reported that Disney is preparing to cut thousands of jobs and has asked some managers to target 20% in annual cost savings. Deadline and CNBC reported the plan through their own sources, and Variety called it the biggest round of cuts this year. Disney has declined to comment.

The cuts look less like a shock than a catch-up. Operating income at Disney’s TV networks, not counting ESPN, is down 43% since fiscal 2022, partly because Disney moved its Indian channels into a joint venture. Disney’s biggest cable channels have lost more than a quarter of their homes since 2019. Its studio earned a 4.6% margin last fiscal year, less than half what Comcast’s studio reports and about a quarter of Warner Bros. Discovery’s, though the companies measure profit differently. And while most of its legacy-media rivals spent the past three years shrinking, merging or splitting up, Disney grew. Paramount’s work force is down 28% since 2022, and Netflix said last month that it would cut 6% of its staff. Disney’s head count, which includes its theme parks, rose 5%.

Here is how Disney compares with its rivals, and what investors have been telling it.

What has been reported, and what hasn’t

The 20% is a savings target for some managers, not a share of the workforce, and Bloomberg says the savings could come from job eliminations as well as from other expenses. Bloomberg says some of Disney’s operations will be affected disproportionately without saying which; Deadline names the TV networks and the movie studio. No outlet has reported a number or a date. By our count this would be Disney’s fifth round of cuts this year, after about 1,000 jobs in April, several hundred in July, a few hundred in September and 100 to 200 in the parks unit in October.

TV is shrinking for everyone

Exhibit 1: Change in TV-network profit from a year earlier, latest fiscal year: Warner Bros. Discovery -21.3%, Paramount -15.0%, Versant -14.5%, Disney -14.4% (mostly from moving Star India into a joint venture), Disney's U.S. networks only -0.4%, Fox +2.3%. Disney's biggest channels, U.S. homes in millions, 2019 to 2025: ESPN 83 to 61 (-27%), Disney Channel 86 to 61 (-29%), FX 87 to 62 (-29%), Nat Geo 86 to 61 (-29%), Freeform 85 to 51 (-40%).

Disney’s TV problem isn’t unique, which is part of why the cuts were coming. TV-network profits fell at most of Disney’s rivals in their latest fiscal years: 21% at Warner Bros. Discovery’s networks, about 15% at Paramount’s TV Media unit and 14.5% at Versant, the cable networks Comcast spun off in January. Only Fox, whose cable networks are anchored by Fox News, grew.

Disney’s own decline last year was mostly a deal, not a slump. Operating income at its TV networks, which don’t include ESPN, fell 14% in fiscal 2025, mostly because Disney moved Star India into a joint venture; its U.S. networks earned $2.38 billion, about the same as a year earlier. The longer trend is the problem. The networks earned $3.0 billion of operating income in fiscal 2025, down from $5.2 billion in fiscal 2022, and most of that drop came before the Star India deal. ESPN, which Disney counts in a separate sports segment, reached an estimated 61 million homes in September 2025, down from 83 million in 2019, and Freeform fell to 51 million from 85 million, partly because a large distributor dropped it in 2023.

Disney’s rivals have answered by getting out or getting smaller. Comcast spun off its cable networks as Versant, plans to separate NBCUniversal into its own public company by mid-2027 and expects a restructuring charge of more than $1 billion this quarter, with job cuts focused on its broadband and cable business rather than NBCUniversal. Paramount merged with Skydance in August 2025, began cutting about 2,000 jobs that October and completed its $110 billion takeover of Warner Bros. Discovery on Oct. 6. The combined company, now called Skydance, is offering buyouts and is seeking $6 billion of cost reductions over three years, which David Ellison has said will come mainly from technology, procurement and real estate rather than job cuts.

Disney has kept its U.S. networks. Bob Iger said in 2023 that they “may not be core to Disney,” then held on to them. In March, LightShed Partners’ Rich Greenfield said D’Amaro’s arrival was a chance to split the traditional TV networks away from Disney’s streaming and other entertainment businesses, WDW News Today reported. Cutting the networks’ costs is the step in between.

The studio earns less than its brands suggest

Exhibit 2: Studio profit as a share of revenue, latest fiscal year: Warner Bros. Discovery 20.2%, Comcast 9.7%, Disney 4.6%; Paramount's film unit lost money in 2024 and 2025. Operating income of Disney's content sales and licensing business: $0.35 billion in fiscal 2022, a $0.18 billion loss in 2023, $0.33 billion in 2024 and $0.39 billion in 2025.

The studio should be where Disney’s brands give it the biggest edge. Its margins say otherwise. Content sales and licensing, which covers Disney’s theatrical releases, home entertainment and licensing to outside buyers, earned $392 million on $8.49 billion of revenue in fiscal 2025, a 4.6% margin, after losing money in fiscal 2023. Warner Bros. Discovery’s studios earned $2.5 billion of adjusted EBITDA on $12.6 billion of revenue in 2025, about 20%, and Comcast’s studios about 10%. Paramount’s film unit lost money in both 2024 and 2025.

The comparison is rough. The rivals report EBITDA, which leaves out depreciation and amortization, and each company splits revenue and costs between its studio and its own streaming and TV businesses differently. But the gap is wide, and Disney stopped reporting the studio’s results separately in fiscal 2026.

The studio’s results swing with its slate, and this year’s suggests the margin won’t widen quickly. Toy Story 5 grossed $1.15 billion worldwide and The Devil Wears Prada 2 $693 million, but Disney said in August that The Mandalorian and Grogu and the live-action Moana “underperformed our box office expectations.” Bank of America’s Jessica Reif Ehrlich expects “a more challenging setup” for the Entertainment segment in fiscal 2027, citing a lighter film slate, slower gains in streaming revenue per subscriber and higher content spending, Benzinga reported in September. Starting this quarter, the first of fiscal 2027, Disney is moving much of its consumer-products business into the Entertainment segment, bringing it “closer to the studios that create that IP,” D’Amaro and Hugh Johnston, Disney’s finance chief, wrote to shareholders in August. That will change how the Entertainment segment’s economics look on paper, though not the slate.

Disney’s rivals got smaller. Disney’s head count didn’t.

Exhibit 3: Change in employees from fiscal 2022 to the latest fiscal year: Netflix +25%, Disney +5%, Fox flat, Comcast -4%, Warner Bros. Discovery -5%, AMC Networks -11%, Paramount -28%. Disney's count includes theme-park, cruise and resort workers; Comcast's includes its broadband business, Sky and Universal's parks; Paramount sold Simon & Schuster in 2023.

Since fiscal 2022, Paramount’s work force has fallen 28%, AMC Networks’ 11%, Warner Bros. Discovery’s 5% and Comcast’s 4%. Fox’s is flat. Netflix, still growing, added 25%, then said in October that it would cut about 1,000 jobs, or 6%. Disney’s grew 5%, to about 231,000, after peaking at 233,000 in fiscal 2024.

That comparison likely overstates Disney’s growth on the media side. In fiscal 2020, the last time Disney broke out its work force, about three-quarters of its employees worked in the parks unit, and the company doesn’t say how many people work in its media businesses now. It cut about 7,000 jobs in 2023, yet its total head count rose by about 5,000 that fiscal year, which suggests the parks kept hiring. The rivals’ counts are mixed, too: Comcast’s includes its broadband business, Sky and Universal’s theme parks, and Paramount’s decline spans its 2023 sale of Simon & Schuster. But the direction is hard to miss. Disney’s rivals spent three years cutting, while its total work force kept growing until 2024, and its cuts this year have come in rounds of a few hundred to about 1,000.

Doing less with more

Exhibit 4: Revenue per employee, latest full year available: Lionsgate Studios $2.87 million, Netflix $2.82 million, Fox $1.62 million, Paramount $1.57 million (2024), Versant $1.52 million, AMC Networks $1.33 million, Disney's media businesses an estimated $0.93 million to $1.30 million, Warner Bros. Discovery $1.05 million.

Revenue per employee is a blunt measure, but it is one way to compare companies of different sizes. By our estimate, Disney’s media businesses, its Entertainment and Sports segments, brought in $0.93 million to $1.30 million of revenue per employee in fiscal 2025. Fox brought in $1.62 million, Paramount $1.57 million in 2024, Versant $1.52 million and Netflix $2.82 million. Only Warner Bros. Discovery, at $1.05 million, fell within our range for Disney.

The estimate rests on assumptions. Disney last split its work force by business in fiscal 2020, during pandemic furloughs, when about 24% of its employees worked outside the parks unit, and we use a range around that share. The mix has surely changed since, and Disney’s media businesses include ESPN’s production crews and Disney+’s technology teams. The rivals count differently, too: Paramount’s figure leaves out about 3,500 project-based staff, and Fox and Lionsgate count only full-time employees. Even at the top of our range, Disney’s media side brings in less per employee than Fox or Versant, and about the same as Paramount once Paramount’s project-based staff are counted.

The activists said this years ago

Exhibit 5: Disney's selling, general, administrative and other costs, fiscal 2018 to 2025: $8.9 billion, $11.5 billion, $12.4 billion, $13.5 billion, $16.4 billion, $15.3 billion, $15.8 billion and $16.5 billion, or 14.9%, 16.6%, 18.9%, 20.0%, 19.8%, 17.3%, 17.2% and 17.5% of revenue. Callouts mark Trian's January 2023 critique and Iger's February 2023 job cuts.

Peltz wasn’t the first to make this argument. In August 2022, Third Point’s Daniel Loeb wrote to Bob Chapek, then Disney’s chief executive, that “Disney’s costs are among the highest in the industry, and we believe Disney significantly underearns relative to its potential,” and urged “a cost cutting program that addresses both margins and the disposal of excess underperforming assets.” He also pushed for a spinoff of ESPN, dropped that idea within a month and signed an agreement with Disney that added a director, Carolyn Everson, and capped Third Point’s stake.

Trian’s 2023 deck put numbers on the complaint. Besides the overhead figures, it said that “over the last three years costs have outpaced sales growth by ~400bps,” that Disney was “Overearning in the Parks business to subsidize streaming losses,” and that Netflix spent about 30% less than Disney’s streaming business on expenses other than programming, on more revenue. Trian also drew a line: it was “NOT seeking to cut costs that impact product quality or customer experience.” After Iger’s announcement, Peltz told CNBC, “We will be watching, we will be rooting, and the proxy fight is over.”

The 2023 program worked, for a while. Disney raised its savings target to $7.5 billion that November, and its selling, general and administrative costs fell to $15.3 billion in fiscal 2023. They have risen in each year since, by 7.6% in total against 6.2% for sales, to $16.5 billion in fiscal 2025, slightly above the 2022 level Trian criticized. As a share of revenue they are lower than in 2022, 17.5% against 19.8%, but well above the 14.9% of fiscal 2018, before Disney bought most of 21st Century Fox and launched Disney+. Disney’s work force kept growing, to a peak of 233,000 in fiscal 2024.

When Trian came back in late 2023, its complaint had moved from costs to results. “Consensus EPS estimates for fiscal years 2024 and 2025 have fallen meaningfully, even as the Company claims to be cutting billions of costs,” it said in December 2023, adding that “Studio content continues to disappoint consumers, slowing the speed of the flywheel and threatening future earnings growth.” In January 2024, it asked Disney to reach “Netflix-like margins of 15-20% by FY 2027” in streaming. Fiscal 2027 began last month; Disney’s subscription-streaming businesses earned a 13% margin in the April-June quarter. Peltz lost the April 2024 vote with about 31% support, and by late May Trian had sold its entire stake at close to $120 a share, Reuters reported, citing CNBC. ValueAct Capital, which backed Iger’s board in that fight, held no Disney shares at the end of June, its latest filing shows.

No activist has gone public since; a search of SEC filings shows no Schedule 13D or proxy-fight filing against Disney since mid-2024. The pressure now comes from D’Amaro’s own promise.

What the market thinks

Investors haven’t punished the reports. Disney shares rose about 1% on Tuesday, the first trading day after Bloomberg’s report, and kept climbing on Wednesday morning to a 52-week high above $119. At 10:35 a.m. Eastern time they were up about 4% on the day.

Wednesday’s gain wasn’t Disney’s alone. Stocks rallied broadly the day after the midterm elections, and media stocks rose even more: the S&P 500 was up 1.6%, Netflix 4.1% and Comcast 4.6%. From Monday’s close, before Bloomberg’s report, through Wednesday morning, Disney gained 5.2%, in line with Netflix’s 5.8% and Comcast’s 3.8%. So far the stock has moved with its peers, which makes it hard to credit the cuts for the gain.

What sets Disney apart is the year. Its shares are up about 5% in 2026, while Netflix’s are down about 30%, Comcast’s about 12% and Fox’s about 5%. They still trail the S&P 500, which is up about 12%. And at Wednesday’s high, Disney traded about where Trian reportedly sold its stake in 2024, at close to $120 a share.

Wall Street’s complaint hasn’t been that Disney cuts too much. It’s that the stock went nowhere for years. When D’Amaro took over in March, Guggenheim’s Michael Morris wrote that Disney shares had “underperformed the S&P 500 by 60%” since Iger returned in late 2022, according to Deadline. The shares hit their low for the year later that month and have risen 29% since. On Tuesday, MarketWatch quoted Bernstein’s Laurent Yoon: “And if DIS doesn’t invest? Then we suspect the stock remains rangebound, as it has for years, absent a more compelling growth narrative to drive investor confidence.” Analysts’ average price target is about $127, roughly 6% above Wednesday morning’s price, according to Yahoo Finance.

That is the bind the cuts could help resolve. Disney has promised double-digit growth in adjusted earnings per share in fiscal 2027, and analysts on average expect $7.47, up 7.8% from the $6.93 they expect for fiscal 2026, or roughly 12% without fiscal 2026’s extra week. Bloomberg reports that D’Amaro wants to put part of the savings back into film and TV programming, technology, and the theme parks and cruise ships. Investors will want to see how much reaches earnings.

What Disney can expect

  • Nov. 17: Disney’s fiscal 2026 fourth-quarter results and fiscal 2027 outlook. Watch for a savings figure (in 2023 Disney promised $5.5 billion, later raised to $7.5 billion), a restructuring charge, whether the double-digit earnings forecast holds and what Disney says about TV and the film slate.

  • Dec. 18: Avengers: Doomsday opens, the biggest test of Disney’s fiscal 2027 slate.

  • First quarter of fiscal 2027: Much of consumer products moves into the Entertainment segment, changing how that segment’s results look.

  • Tuesdays and Thursdays: California posts layoff notices. The state requires 60 days’ warning for larger layoffs at one site, so a cut that takes effect in January would need a notice between now and early December.

  • Fiscal 2026 annual report: Disney’s year-end head count, expected with or soon after the Nov. 17 results. Disney hasn’t split the figure by business since fiscal 2020.

The risks

The reports are anonymous. Bloomberg, Deadline and CNBC cite unnamed sources, and Disney hasn’t confirmed a number, a date or the teams involved.

Our benchmarks are rough. Companies measure profit differently, their fiscal years end in different months, and our revenue-per-employee figure for Disney is an estimate.

A studio’s margin depends more on hits than on head count. If the fiscal 2027 slate disappoints, cutting staff won’t fix it, and cutting marketing could make it worse.

Cuts can come back. Disney’s overhead and work force both rose after the 2023 program. Without a target that sticks, this round could follow the same path.

What would change our view. Our case that Disney’s media side is overstaffed rests on its bringing in less revenue per employee than its rivals. Disney doesn’t disclose head count by business. If it does, and the numbers show that the growth since 2022 came entirely from the parks and cruise ships and that the media side has already shrunk, that case gets weaker.

A month ago, Dana Walden, Disney’s president and chief creative officer, said that “in this exact moment” she didn’t think Disney was “the company that is going to be the tip of the spear around any kinds of efficiency targets or layoffs.” On the numbers, she was right. Disney’s rivals got there first.

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How we did this

We compared Disney with the legacy media companies that report similar businesses, Warner Bros. Discovery, Paramount (now Skydance), Comcast and its spun-off cable networks (Versant), Fox, AMC Networks and Lionsgate, plus Netflix. Figures come from each company’s latest annual report or full-year earnings release. Fiscal years end in different months, so “latest fiscal year” means calendar 2025 for most rivals, the year ended Sept. 27, 2025 for Disney and the year ended June 30, 2026 for Fox. TV and studio profit use each company’s own segment measure. Disney’s TV-network figures exclude ESPN; we split its fiscal 2025 change into U.S., international and equity income using its four quarterly releases. Paramount’s 2025 figures combine the periods before and after its August 2025 merger, which the company says aren’t comparable. Comcast’s studio figures add up its four 2025 quarterly releases. Head counts come from annual reports and are year-end figures, except Lionsgate’s, which is from May 2026; Fox and Lionsgate count full-time staff only, and Paramount leaves out project-based staff. Disney doesn’t report head count by business; our revenue-per-employee range applies 20% to 28% (around the 24% it last disclosed, for fiscal 2020) to its 231,000 employees, and Disney’s media revenue is its Entertainment and Sports segments’ revenue before intersegment eliminations. Overhead is the “selling, general, administrative and other” line in Disney’s annual reports. We read Bloomberg’s report as syndicated by Yahoo Finance. Deadline’s, CNBC’s and Variety’s pages did not load for us, so we relied on Pirates & Princesses’ summary of Deadline and on CNBC’s and Variety’s headlines. The Bernstein quote comes from our research file, which read MarketWatch’s Nov. 3 report in syndication; we couldn’t open a copy ourselves. Stock prices come from Yahoo Finance; Wednesday’s figures are as of 10:35 a.m. Eastern time on Nov. 4, and year-to-date changes run from the 2025 close; Comcast’s is adjusted for its January spinoff of Versant. Activist documents come from SEC filings and the funds’ own releases.

Sources

]]><![CDATA[Disney’s Profits Are Up. Why Is It Cutting Thousands of Jobs?]]>https://substack.mousemoney.co/p/disneys-profits-are-up-why-is-ithttps://substack.mousemoney.co/p/disneys-profits-are-up-why-is-itTue, 03 Nov 2026 18:43:57 GMT
Mouse Money cover: Disney's profits are up. Why is it cutting thousands of jobs? The ask: 20%, the annual savings some managers were asked to find, per Bloomberg. The profit: +21%, Disney's segment operating income in the April-June quarter. The promise: 10%+, the adjusted EPS growth Disney expects in fiscal 2027.

Disney is preparing to cut thousands of jobs and has asked some managers to target 20% in annual cost savings, Bloomberg reported Monday evening. Deadline reported the plan through its own sources, and CNBC followed on Tuesday. Disney declined to comment to Bloomberg. No outlet has reported a number, a date or exactly which teams.

The cuts aren’t a response to a bad quarter. Disney’s segment operating income rose 21% in the April-June quarter, and its parks unit earned more than half of the company’s profit in fiscal 2025. Disney planned to buy back at least $9 billion of its own stock in the fiscal year that ended in early October. What it has promised Wall Street is harder: double-digit growth in adjusted earnings per share in fiscal 2027, which began in October, while analysts expect its sales to grow only about half that fast. Earnings per share can outrun sales only if margins widen, the share count shrinks, or both. Cutting costs is the most direct lever, and Bloomberg reports that D’Amaro wants to put part of the savings back into film and TV programming, technology, and the theme parks and cruise ships.

Wall Street has been asking about this all year, though not about how many jobs. Analysts on Disney’s earnings calls have asked whether its savings will go to the bottom line or back into the business, and how much artificial intelligence can save. None, as far as we could find, has published an estimate of how many jobs Disney could cut. Disney’s finance chief, Hugh Johnston, has been more direct than the analysts. He told them in May that Disney was working toward “right-sizing our organization,” and he has listed managing park staff and making back-office workers “more effective and more efficient” among the ways AI could raise revenue or cut costs.

What has been reported, and what hasn’t

The 20% is a savings target for some managers, not a share of the workforce. Bloomberg says the savings could come from eliminating jobs as well as from other expenses, and that some of Disney’s operations, which it says range from the theme parks to the TV networks and the film studio, will be affected disproportionately. It doesn’t say which. Deadline names the TV networks and the studio. CNBC, which reported “several thousand” cuts, says the target is up to 20%. Deadline also reported that more managers than expected had taken an early-retirement offer Disney made in August.

The cuts have been coming in rounds all year. In April, Disney eliminated about 1,000 jobs, mostly in the marketing division it had combined in January. Several hundred followed in July, including 108 at Pixar. In late August, Disney offered early retirement to some longtime U.S. executives, from director to executive vice president, in its entertainment, ESPN and corporate units, and its chief people officer, Sonia Coleman, wrote that “involuntary staff reductions that have already begun in some areas” would “continue into next year.” A few hundred human-resources and technology jobs went in September, and 100 to 200 at Disney Experiences, including at Imagineering, in October. The Wall Street Journal reported in October that a restructuring of the TV group under Debra O’Connell could eliminate hundreds of jobs.

What Wall Street expects

Exhibit 1: Wall Street expects earnings to grow nearly twice as fast as sales in fiscal 2027. Analysts' average forecasts versus fiscal 2026: revenue up 4.5% ($106.1 billion vs. $101.5 billion) and adjusted EPS up 7.8% ($7.47 vs. $6.93). Without fiscal 2026's extra week, revenue up about 6.5% (our rough estimate) and adjusted EPS up about 12%. For the fiscal fourth quarter, reported Nov. 17, analysts expect adjusted EPS of $1.69 (vs. $1.11) and revenue of $25.2 billion (vs. $22.5 billion); Disney forecast segment operating income of $4.9 billion, with about $600 million from the extra week.

Disney reports its fiscal fourth quarter, which ended Oct. 3, before the market opens on Nov. 17. Analysts expect adjusted earnings of $1.69 a share, according to Yahoo Finance, up from $1.11 a year earlier, partly because the quarter had an extra week. Disney itself has forecast about $4.9 billion of segment operating income for the quarter, including about $600 million from that 53rd week.

The bigger number is fiscal 2027. Analysts on average expect adjusted earnings per share of $7.47, up 7.8% from the $6.93 they expect for fiscal 2026, on revenue up about 4.5%. Both figures are held down by fiscal 2026’s extra week. Disney says that week lifts fiscal 2026 EPS growth to about 16% from about 12%. Take it out, and the fiscal 2027 forecast works out to EPS growth of roughly 12% on sales growth of roughly 6% to 7%, by our rough estimate. Wall Street, in other words, has already written Disney’s double-digit promise into its numbers, and it expects earnings to grow nearly twice as fast as sales.

Analysts have pressed Disney on what the cuts are for. On the May earnings call, Wells Fargo’s Steven Cahall pointed to “some recently announced workforce reductions” and asked whether “efficiency gains” would fall “to the bottom line” or be “reinvested into areas of growth like content or technology spend.” Johnston said Disney was working toward “right-sizing our organization for the state of the business today and where we want to go over time,” that it wouldn’t “size the opportunity,” and that it wanted “to fund growth opportunities from within the existing expense base.” In August, answering a question about stock buybacks, he said Disney was looking at “meaningful reductions to cost, including labor and SG&A,” the accounting line for selling, general and administrative costs, which includes marketing and overhead. Bank of America’s Jessica Reif Ehrlich wrote in late September that savings from cost cuts were likely to be largely reinvested in streaming and that the Entertainment segment faced a harder year in fiscal 2027, Benzinga reported.

The stock is where the pressure shows. Disney shares are roughly flat for 2026, while the S&P 500 is up about 11%. When D’Amaro took over in March, Guggenheim’s Michael Morris wrote that the shares had “underperformed the S&P 500 by 60%” since Bob Iger returned in late 2022, according to Deadline. The layoff reports barely moved the stock on Tuesday morning.

The parks make the money

Exhibit 2: Fiscal 2025 segment operating income: Experiences $10.0 billion (57% of the total), Entertainment $4.7 billion (27%), Sports $2.9 billion (16%). Change in the April-June 2026 quarter from a year earlier: Experiences +20%, Entertainment +64%, Sports -17%. About four points of Experiences' growth came from a tariff refund.

Disney’s Experiences segment, which includes the parks, cruises, resorts and consumer products, earned $10 billion of operating income in fiscal 2025, 57% of the total. It grew 20% in the April-June quarter, about four points of it from a tariff refund, and Disney expected its full-year growth to come in at the high end of its high-single-digit forecast.

Whether the parks are part of this round is unclear. Bloomberg mentions them among the businesses Disney runs and among those D’Amaro wants to reinvest in, and Pirates & Princesses noted that neither Bloomberg nor Deadline said whether front-line cast members would be affected. The parks unit’s October cuts reached Imagineering, its design and engineering arm: 159 layoffs Disney listed in a California notice for Imagineering’s Glendale campus take effect Dec. 29.

The studio and TV are the pressure points

Exhibit 3: Entertainment segment operating income by business, fiscal 2022 to 2025. TV networks: $5.2 billion, $4.1 billion, $3.5 billion, $3.0 billion. Streaming: -$3.4 billion, -$2.5 billion, $0.1 billion, $1.3 billion. Studio and licensing: $0.4 billion, -$0.2 billion, $0.3 billion, $0.4 billion. Disney stopped reporting the three businesses separately in fiscal 2026.

The Entertainment segment is where the numbers argue for cuts. Operating income from Disney’s TV networks fell from $5.2 billion in fiscal 2022 to $3.0 billion in fiscal 2025, down 43%, as cable subscribers kept leaving, advertising weakened and Disney moved its Indian TV business into a joint venture. Streaming moved the other way, from a $3.4 billion loss to a $1.3 billion profit, and Disney’s subscription-streaming businesses earned $712 million in the April-June quarter, a 13% margin.

The studio is the thinnest line. Content sales and licensing, which covers theatrical releases, home entertainment and licensing of films and shows, earned $392 million on $8.49 billion of revenue in fiscal 2025, a 4.6% margin, after losing money in fiscal 2023. This year Disney stopped reporting it separately.

Exhibit 4: Disney's larger 2026 films, worldwide box office as a multiple of reported production budget: The Devil Wears Prada 2 6.9x and Toy Story 5 4.6x; Hoppers 2.6x and Send Help 2.4x, near break-even; The Mandalorian and Grogu 2.1x, Moana (live action) 1.3x and The Dog Stars under 0.5x. A dashed line marks 2.5x, a rough break-even.

The 2026 slate shows why. Toy Story 5 has grossed $1.15 billion worldwide on a reported $250 million budget, and The Devil Wears Prada 2 $693 million on about $100 million. But Disney said in August that The Mandalorian and Grogu and the live-action Moana “underperformed our box office expectations,” and that its fourth-quarter Entertainment results would “reflect the impact of Moana’s box office performance.” Moana has grossed $324 million on a reported $250 million budget.

Is the studio inefficient? Disney no longer reports enough to say. What is clear is that a studio’s costs don’t shrink when its films disappoint, because production and marketing money is spent before a movie opens. When Disney last made big cuts, in 2023, about half of the $2.5 billion it set out to save outside of content was to come from marketing and about 30% from labor, its finance chief said at the time. Lower marketing costs are already showing up: the Entertainment segment’s selling, general and administrative costs fell $187 million in the April-June quarter from a year earlier, to $2.3 billion, which Disney attributed to lower marketing costs. It didn’t say how much came from this year’s marketing cuts. Hits don’t protect jobs, either: in July, a month after Toy Story 5 opened, Pixar filed notice that it would lay off 108 people in Emeryville, Calif.

Is it AI?

D’Amaro’s April layoff memo said Disney had to “constantly assess how to foster a more agile and technologically-enabled workforce.” In public, though, Disney says AI is about more than cost. “With AI, it isn’t simply about efficiency,” its August letter to shareholders said, adding that Disney uses AI “first and foremost to enhance a creative process” and had given an AI tool called J.A.R.V.I.S. to its more than 2,000 Imagineers earlier this year. In September it hired Character.AI’s chief executive, Karandeep Anand, as its first company-wide chief technology officer.

Its finance chief has been plainer with investors. Asked at a Morgan Stanley conference in March what generative AI could mean for Disney, Johnston listed five areas, including “managing the large cast that we have running the parks” and “making our back-office people more effective and more efficient.” All five, he said, “have the potential to either drive a lot of revenue for the company or alternatively to reduce costs for the company.” In May, when Needham’s Laura Martin asked where Disney was integrating generative AI “to lower costs and/or accelerate revenue growth,” Johnston pointed to “precision labor demand forecasting across our theme parks,” which he said could create “a better guest experience, a better employment experience, and also better cost management for the company.” And at a Goldman Sachs conference in September, he described “that virtuous circle of reducing costs, reinvestment in the business, driving growth, creating operating leverage, and then reducing cost again.” If Disney could keep that up, “leveraging both our cost management as well as artificial intelligence,” he said, it would be “an earnings compounder for many, many, many years to come.”

The clearest link between AI and jobs is in the legal department. In a Sept. 18 memo first reported by Deadline, Disney’s top lawyer, Horacio Gutierrez, told the fewer than 1,000 people in Legal and Global Affairs that the group “will be a much smaller organization than it is today.” The memo also mentioned “automating certain workflows.” Six days later, Disney posted an opening for a director of “AI Enablement & Legal Engineering.”

Analysts are asking the same question about the studio. On the August call, Morgan Stanley’s Sean Diffley asked how to think about AI “cost savings across different film types.” D’Amaro answered that Disney was using AI across the company “to gain efficiency, to be faster, to accelerate velocity, and unleash creativity.”

What no outlet has reported is that AI is replacing the jobs being cut now. The rounds so far look like older moves: combining marketing and back-office teams, restructuring TV and trimming a studio whose results swing between hits and misses. The parks are where Johnston has been most specific about AI and labor, but no outlet has reported that park jobs are part of this round, let alone tied them to AI. AI is part of Disney’s plan to spend less over time. Disney hasn’t said it is the reason for this round.

The head count

Exhibit 5: Job cuts as a share of Disney's workforce: the 7,000 cuts of 2023 were 3.2%; 2026's rounds before this one, about 1,500 to 1,800 jobs, were 0.6% to 0.8%; this round, read as 2,000 to 5,000 jobs, would be 0.9% to 2.2%; all of 2026 would be 1.5% to 2.9%.

Disney employed about 231,000 people at the end of fiscal 2025: 172,000 in the U.S. and 59,000 abroad, about three-quarters of them full-time. That is up from 133,000 in fiscal 2006, and it kept growing after the 2023 cuts, from about 220,000 in fiscal 2022 to a peak of 233,000 in fiscal 2024. Read as 2,000 to 5,000 jobs, “thousands” would be 0.9% to 2.2% of the workforce, a smaller share than the 7,000 cuts of 2023 and far smaller than the 32,000 of 2020, most of them in the parks unit during the pandemic closures.

Analysts have said little about that number. We found no Wall Street estimate of how many jobs Disney could cut, what the 20% ask would save or how big Disney’s workforce should be, and on Disney’s August earnings call, no analyst asked about head count. Their questions have been mostly about money, not people.

The most detailed outside critique of Disney’s overhead is nearly four years old. In January 2023, Nelson Peltz’s Trian Fund Management told shareholders that Disney’s selling, general and administrative costs had risen 85% in four years, to $16.4 billion in fiscal 2022, a stretch that included Disney’s purchase of most of 21st Century Fox and the launch of Disney+. Trian said it believed “Disney has never thoroughly reviewed its cost structure.” In fiscal 2023, the year of the last big cuts, those costs fell to $15.3 billion. They have grown faster than sales since, reaching $16.5 billion in fiscal 2025, slightly above the 2022 level Trian criticized. Head count and overhead both drifted back up after the last round of cuts. Johnston has said Disney wants to “build a culture of efficiency” and that the work is “an ongoing exercise.”

Inside Disney, the plainest talk about head count has come from Dana Walden, its president and chief creative officer. Explaining the TV reorganization at a Bloomberg conference on Oct. 1, she said Disney had to “evaluate how many people do we need, how many people are so many that it’s actually keeping us from being agile, speed of decision making.”

What we are watching

  • Nov. 17: Disney’s fiscal 2026 fourth-quarter results and fiscal 2027 outlook. Watch for a savings figure (in 2023 Disney promised $5.5 billion, later raised to $7.5 billion), a restructuring charge, whether the double-digit EPS forecast holds, and how much of the savings Disney says will reach earnings.

  • Tuesdays and Thursdays: California’s posted layoff notices. The state requires 60 days’ warning for larger layoffs at one site, and Disney has filed 63 to 67 days ahead this year, so a cut that takes effect in January would need a notice between now and early December.

  • Dec. 29: The 159 Imagineering layoffs take effect.

  • Fiscal 2026 annual report: Disney’s year-end head count, expected with or soon after the Nov. 17 results.

The risks

The reports are anonymous. Bloomberg, Deadline and CNBC all cite unnamed sources, and Disney hasn’t confirmed a number, a date or the teams involved.

”Thousands” is vague. Our 2,000-to-5,000 range is an illustration, not a forecast.

Early retirements may shrink the layoffs. Deadline says more managers took the August offer than expected, which could mean fewer layoffs than “thousands” suggests.

Reinvestment cuts both ways. If most of the savings go back into content, technology and the parks, the cuts will show up in Disney’s spending more than in its earnings.

What would change our view. If Disney lowers its fiscal 2027 forecast on Nov. 17, these cuts are about protecting earnings, not paying for growth. If it reaffirms double-digit growth and names a savings figure it plans to reinvest, the cuts are what D’Amaro has said they are.

Disney isn’t cutting because it is losing money. It says it is cutting to pay for growth, while promising Wall Street earnings growth that sales growth alone won’t deliver. Nov. 17 will show how it plans to do both.

If this was forwarded to you, subscribe to get our Nov. 17 breakdown of Disney's results.

How we did this

We read Bloomberg’s report as syndicated by Yahoo Finance. Deadline’s, CNBC’s and Variety’s pages did not load for us, so we relied on Pirates & Princesses’ summary of Deadline’s report and on CNBC’s headline; we couldn’t see whether Variety had its own sources. Analysts’ questions and executives’ answers come from Disney’s official transcripts of its May 6 and Aug. 5 earnings calls and of Johnston’s March 2 and Sept. 9 conference appearances. We searched coverage of the Nov. 2-3 reports through Tuesday afternoon for analysts’ comments and found none. Financial figures come from Disney’s annual reports and its fiscal 2026 quarterly releases; the fiscal 2022 overhead figure, which Trian cited, is from Disney’s fiscal 2022 annual report. Analysts’ forecasts are Yahoo Finance’s consensus as of Nov. 3. To compare fiscal 2027 with fiscal 2026 on a like-for-like basis, we used Disney’s guidance that fiscal 2026 adjusted EPS will grow about 12% without the 53rd week, which puts the base at about $6.64 ($5.93 times 1.12); for revenue, we took one fifty-third of analysts’ fiscal 2026 forecast out of the base, a rough cut that treats every week alike. Box office grosses are as of Nov. 1, from Box Office Mojo, checked against The Numbers; budgets are as reported by trade publications and other outlets and exclude marketing. “Thousands” is shown as 2,000 to 5,000, and earlier 2026 rounds are approximate press counts. Layoff-notice dates come from California’s Employment Development Department.

Sources

]]><![CDATA[Disney Used to Build the Future. Its New CEO Wants It Back.]]>https://substack.mousemoney.co/p/disney-used-to-build-the-future-itshttps://substack.mousemoney.co/p/disney-used-to-build-the-future-itsSat, 31 Oct 2026 11:38:15 GMT
Cover with drawings of a carousel, a robot, a rocket and a microchip, and the headline Disney's new CEO wants to build the future again. Stats: 1994, when the Carousel of Progress last updated its future, with a redo opening in 2027; $180 million, Disney's estimate of three years of pay and retention for its Character.AI hires, against $20 million for the technology; 57%, the share of Disney's segment operating income in fiscal 2025 that came from its parks, cruises and consumer products segment, which also took 80% of capital spending.

For more than 30 years, the future at Walt Disney World’s Carousel of Progress looked like the early 1990s. In the show’s final scene, the father of the family promises that his new voice-activated oven won’t burn the turkey, then accidentally tells it to heat to 975 degrees.

In July, Disney closed the show for its biggest overhaul since 1994. When it reopens late next spring, the last act will be called “The Possible Future,” set in an “out-of-this-world home” with a robot helper, and a new opening scene will bring back Walt Disney as an Audio-Animatronics figure.

Disney’s new chief executive is betting the company can build the future again, not just stage it. Josh D’Amaro, who took over in March after 28 years in Disney’s parks business, has made technology one of his three priorities and hired the head of the chatbot startup Character.AI as Disney’s first company-wide chief technology officer. Court filings show Disney expects to spend about $180 million over three years to pay and keep the startup staff it hired, nine times its bid for the startup’s technology.

A parks CEO without an executive chairman

The last parks chief to get the top job, Bob Chapek, was named chief executive in February 2020, while Bob Iger stayed on as executive chairman to “direct the Company’s creative endeavors” through 2021. Within three weeks, the pandemic had closed Disney’s U.S. parks. Chapek ran Disney without an executive chairman above him for less than a year, from January 2022 until the board replaced him with Iger that November. This time, Iger has stepped back to senior adviser and board member until he retires on Dec. 31. D’Amaro has run the company without an executive chairman from his first day.

The expectation was that the parks would be his stage. In February, Orlando’s WKMG wrote in its newsletter that it was “safe to expect D’Amaro to lead the big announcements at D23,” Disney’s fan convention, in August. Instead, his successor as parks chairman, Thomas Mazloum, and a team of Imagineers presented them, with Neil Patrick Harris as host, at a showcase Disney called “Horizons,” the name of an Epcot ride about the future that Disney closed in 1999. D’Amaro has kept the roughly $60 billion, 10-year parks and cruise plan Disney announced under Iger in 2023. He has also cut jobs in four rounds this year, including 159 at Walt Disney Imagineering, the unit that designs the parks.

Disney’s two longest-serving recent chief executives each had a defining bet. For Michael Eisner, who had been president of Paramount Pictures, it was the animation revival that began with The Little Mermaid in 1989. For Iger, who rose through ABC television, it was buying Pixar, Marvel, Lucasfilm and most of 21st Century Fox, then launching Disney+. D’Amaro hasn’t named his. His own words point to technology.

His answer is technology

In his first memo as chief executive, on March 18, D’Amaro named three priorities: storytelling, technology and operating as “One Disney.” The parks, which he had run for nearly six years, were not on the list. “Innovation has always been part of Disney’s DNA,” he wrote.

He has returned to the theme since. On his first earnings call as CEO, in May, he said Disney would “embrace technology more aggressively” and wanted to “remain a leader in the use of technology to enhance creativity,” going “all the way back to when Walt was pioneering synchronized sound and Steamboat Willie.” In August he told investors, “Our company was founded on the convergence of creativity and breakthrough technology.”

The board flagged the same thing when it chose him. Chairman James Gorman credited D’Amaro with “showcasing the power of combining Disney storytelling with cutting-edge technology.” Iger, in an ABC News interview with both men, called his successor someone “that views technology as an opportunity and not a threat.”

It is a theme D’Amaro brought from the parks. Introducing the Genie planning app in 2021, he said Disney was “taking more than 60 years of experience and data and applying artificial intelligence on top of that.” In March 2025, at the SXSW festival, where Disney showed off its walking BDX droids, he told Axios that return on invested capital “goes up by 3 times” over the period since Disney started leaning into technology. He didn’t say for which business or give the underlying figures.

In September he hired Karandeep Anand, Character.AI’s chief executive, as Disney’s first company-wide chief technology officer, reporting directly to him.

What the Character.AI deal is, and isn’t

Disney isn’t buying Character.AI. Bankruptcy filings show it is hiring the people and licensing the technology.

The startup, which runs an app for chatting with AI characters, filed for Chapter 11 protection on Oct. 12. Disney is the lead bidder, offering $20 million for a perpetual, non-exclusive license to its technology, including the software that runs its chatbots, a safety-monitoring system called Guardian and an age-prediction model. Disney doesn’t get the app, its users or its finished chatbot models, and Character.AI can license the same technology to others.

Sixty-six of the startup’s roughly 86 employees accepted jobs at Disney. Disney estimates their pay and retention over three years at about $180 million, including a $30 million retention pool. That works out to about $2.7 million a person.

Disney paid $5.5 million on Sept. 18, the day it announced Anand’s hiring, plus a $2 million refundable deposit, the filings show. Its announcement said some of the startup’s technical team was expected to join Disney; it didn’t mention the payment or the license. Disney required that the deal go through Chapter 11, according to a declaration filed in the case, a route that lets a buyer take assets “free and clear” of claims against the seller.

Those claims are serious. A year to the day before the hire, in a letter dated Sept. 18, 2025, Disney’s lawyers demanded that Character.AI stop using Disney’s characters, writing that the startup’s infringing chatbots were “known, in some cases, to be sexually exploitive and otherwise harmful and dangerous to children.” The startup has faced lawsuits from families and investigations by state officials, and more than 30 states objected to the sale procedures. On Oct. 30, Judge Brendan Shannon approved them and said he would “strongly encourage” the company to hire a privacy ombudsman to evaluate risks to children. Under the proposed schedule, rival bids are due Nov. 20.

Bar chart of the cost of selected AI and technology deals. Google and Character.AI, 2024: about $2.7 billion, as reported. Disney and Epic Games, 2024: $1.5 billion equity stake. Disney and OpenAI, 2025: $1 billion investment announced, then dropped. Disney and Character.AI, 2026: about $180 million in estimated pay and retention for hires over three years, and $20 million for a non-exclusive technology license.

Disney hasn’t said what it will build with the technology. D’Amaro’s first memo said technology could help Disney create “more immersive, interactive, and personal ways for people to experience Disney.”

The deal is also a change of approach. In December, under Iger, Disney agreed to invest $1 billion in OpenAI and license more than 200 characters to its Sora video app. Six days after D’Amaro took over, OpenAI said it would shut Sora down, and Disney dropped the investment. In August, finance chief Hugh Johnston said Disney was expanding its stock buyback “to utilize the cash that had been set aside previously for the OpenAI deal,” along with proceeds from selling its A&E stake. Hiring Character.AI’s team suggests D’Amaro would rather build Disney’s own technology than lend its characters to someone else’s app.

Why Disney needs it

Walt Disney treated technology as part of the show: synchronized sound in Steamboat Willie in 1928, three-strip Technicolor in 1932, the first full-length cel-animated feature in 1937, the first daily monorail in the U.S. in 1959, Audio-Animatronics in 1963. At the 1964 New York World’s Fair, the Carousel of Progress showed a family’s home life getting better with each new invention.

Timeline of selected Disney technology milestones. Under Walt Disney: 1928, Steamboat Willie makes synchronized sound a hit; 1932, Flowers and Trees, first three-strip Technicolor cartoon; 1937, Snow White, first full-length cel-animated feature; 1940, Fantasia plays in stereo with Fantasound; 1955, Disneyland opens; 1959, Disneyland Monorail, first daily monorail in the U.S.; 1963, Tiki Room, first show built on Audio-Animatronics; 1964, Carousel of Progress debuts at the World's Fair. After Walt: 1982, EPCOT Center opens with Future World; 1990, The Rescuers Down Under, first all-digital feature; 1995, Pixar's Toy Story, first computer-animated feature; 2013, MagicBands and MyMagic+ unveiled; 2019, ILM's StageCraft LED stage for The Mandalorian. Under Josh D'Amaro: 2026, Disney's first company-wide chief technology officer.

The breakthroughs kept coming after Walt died in 1966, but more of them happened behind the screen or through partners. EPCOT Center opened in 1982 with what the Christian Science Monitor counted as 450 audio-animatronic robots. The Rescuers Down Under, in 1990, was the first fully digital feature film, made on a system Disney developed with Pixar. Pixar’s Toy Story, which Disney released in 1995, was the first computer-animated feature; Disney bought Pixar in 2006. The LED stage used to film The Mandalorian came from Industrial Light & Magic, which Disney got when it bought Lucasfilm in 2012.

The bigger change was in what the parks showed guests. Epcot’s Future World was built with corporate sponsors, including General Motors, the Bell System and General Electric. As sponsors left, the pavilions about the future closed or became thrill rides. GE stopped sponsoring Horizons in 1993; Disney closed the ride in 1999 and put Mission: Space on the site. World of Motion gave way to Test Track, a thrill ride GM also sponsored. In 2021, Disney retired the Future World name.

Magic Kingdom’s Tomorrowland went retro. Disney remodeled it in 1994 and 1995, giving it, in the words of D23, Disney’s official fan club, “the look of a city like those imagined by sci-fi writers and moviemakers of the 1920s and 1930s.” Three of Tomorrowland’s eight attractions, the Carousel of Progress, the PeopleMover and Astro Orbiter, were last rethemed in 1994. Disney had stopped predicting the future and started decorating with it.

Dot plot of Magic Kingdom's eight Tomorrowland attractions by year opened and year of last major update. Carousel of Progress: opened 1975, last rethemed 1994, closed July 6, reopening spring 2027. PeopleMover: 1975, rethemed 1994, renamed 2010. Astro Orbiter: 1974, 1994. Monsters, Inc. Laugh Floor: 2007, no major update. Space Mountain: 1975, refurbished 2009. Tomorrowland Speedway: 1971, track shortened 2012. TRON Lightcycle / Run: 2023. Buzz Lightyear's Space Ranger Spin: 1998, all-digital targets in 2026. Three of the eight were last rethemed in 1994.

Disney still builds technically ambitious rides, among them Avatar Flight of Passage in 2017, Star Wars: Rise of the Resistance in 2019 and TRON Lightcycle / Run in 2023, which opened while D’Amaro ran the parks. But they are built around films, not the future. Universal, meanwhile, made ride technology part of its pitch in Orlando. Its Harry Potter and the Forbidden Journey, which opened in 2010, carries riders on robotic arms that travel along a track. In May 2025, Universal opened Epic Universe, the first major new theme park in Florida in more than 25 years.

The stakes are large. Disney’s Experiences segment, which includes the parks, cruises and consumer products, produced $10 billion of the company’s $17.6 billion in segment operating income in fiscal 2025, or 57%, and took 80% of its capital spending. The $60 billion plan will decide what the parks look like for years. Disney shares rose about 11% from March 17, the last close before D’Amaro took over, through Oct. 30, a little less than the S&P 500’s 13% gain.

The risks

Child safety. Disney would be licensing technology from a company its own lawyers accused of running chatbots that were, in some cases, harmful to children, and it has hired the executive who ran that company. Disney’s announcement credited Anand with “making user trust and safety a priority as the platform scaled.” The states can raise some of their objections again at the sale hearing.

Fans. A Haunted Mansion photo effect at Magic Kingdom that appeared to use generative AI drew a backlash online in September. When it returned on Oct. 21 for a limited test, fan sites reported that it was “completely optional,” with a second photographer taking standard pictures.

Cost and optics. Disney’s own estimate works out to about $2.7 million per Character.AI hire over three years, in a year when it has cut more than 1,000 jobs.

Execution. Disney’s last big AI partnership, with OpenAI, unraveled in less than four months.

The test. If the technology push shows up mostly as cost cuts and chatbot features rather than in what guests can see and do in the parks, D’Amaro’s legacy will be efficiency, not invention.

What we are watching

  • Nov. 17: Disney’s fiscal fourth-quarter and full-year results, its first year-end report under D’Amaro. Watch for any dollar figure on technology spending or savings, the fiscal 2027 capital-spending outlook and any change to the $60 billion plan.

  • Nov. 20, 23 and 24: Under the proposed schedule, rival bids for Character.AI’s technology are due, then an auction if any arrive, then the sale hearing.

  • Dec. 17: The outside date in Disney’s agreement, after which the deal can be called off if the sale hasn’t closed.

  • Dec. 31: Iger retires from Disney.

  • Late spring 2027: The Carousel of Progress reopens.

The new Carousel’s last act is called “The Possible Future.” Seven months in, that is also the best description of D’Amaro’s technology push.

If this was forwarded to you, subscribe to get our Nov. 17 breakdown of Disney's results.

How we did this

We read Disney’s press releases, earnings-call transcripts and fiscal 2025 annual report; filings in Character.AI’s Chapter 11 case (In re Character Technologies, U.S. Bankruptcy Court for the District of Delaware, Case 26-11603); D23’s Disney A to Z and the Disney Parks Blog for attraction histories; and news coverage. The court’s docket site did not load for us, so quotations from the filings come from outlets that quote them by docket number, mainly PPC Land and Bondoro, plus the states’ notice of interest, which we read directly. Our account of the Oct. 30 hearing comes from Briefs, which links to Bloomberg’s report. The $180 million is Disney’s own estimate of pay and retention for years one to three, including the $30 million retention pool; the per-person figure divides it by the 66 employees who accepted offers. Exhibit 2 is a selection of milestones. In Exhibit 3, “last major update” is the last retheme, rebuild or system overhaul we could document. Share-price changes use Yahoo Finance closing prices and exclude dividends.

Sources

]]><![CDATA[What Disney's layoffs this week may mean for the quarter.]]>https://substack.mousemoney.co/p/what-disneys-layoffs-this-week-mayhttps://substack.mousemoney.co/p/what-disneys-layoffs-this-week-mayFri, 30 Oct 2026 13:42:26 GMT
Cover illustration of a pink slip, a microphone, a calendar and a moving box, with the headline What Disney's layoffs this week may mean for the quarter. Stats: the quarter Disney reports on Nov. 17 ended Oct. 3, before this week's cuts; 90% of the quarters that followed layoff news beat profit forecasts, against 80% of other quarters since 2009; Disney expects about $4.9 billion of segment operating income for the quarter, including about $600 million from an extra week.

Disney’s latest job cuts arrive three weeks before its next earnings report, raising a familiar question: Are they a warning about business conditions or an effort to improve profits?

Mouse Money’s review of Disney’s job cuts since 2009 offers little evidence that their timing reliably answers either question. The more useful clues may be what executives have already told investors about costs, and what they say next about the year ahead.

Start with the record on earnings. Disney topped analysts’ profit forecasts in 19 of the 21 quarters that followed layoff news since 2009, according to Yahoo Finance’s data. It topped them in 39 of its 49 other quarters over the same period, or 80%. The difference amounts to about two quarters, and a sample this small cannot show that layoffs predict a beat.

The latest cuts are in Disney’s parks division, including Walt Disney Imagineering. On Oct. 27, Disney’s parks division notified California regulators that it would lay off 159 people at Imagineering’s headquarters in Glendale, effective Dec. 29. The next day, the Los Angeles Times reported that the division was cutting 100 to 200 jobs. Disney declined to comment. It was the fourth round of cuts since Josh D’Amaro became chief executive in March, after about 1,000 jobs in April, several hundred at Pixar, National Geographic and other units in July, and a few hundred in human resources and technology at the end of September.

The quarter has already closed

The fiscal fourth quarter that Disney reports on Nov. 17 ended on Oct. 3. The September cuts came in its final week, and this week’s came after it closed. The Imagineering layoffs take effect Dec. 29, so their payroll savings begin well into Disney’s 2027 fiscal year. Announcing cuts before an earnings report does not mean the savings helped the quarter being reported.

Severance runs on its own schedule. Disney records it in restructuring charges, which it leaves out of adjusted earnings per share, the figure analysts forecast. In its fiscal third quarter, Disney left $900 million of restructuring and impairment charges out of adjusted earnings: an $812 million write-down of its stake in A+E and $88 million of severance. It recorded $180 million of severance in the first nine months of the fiscal year.

Disney’s own forecast

Analysts expect adjusted earnings of about $1.69 a share, according to Yahoo Finance. Disney has given its own benchmark. In August, it said it expected about $4.9 billion of segment operating income in the fourth quarter, including about $600 million from a 53rd week. Disney’s fiscal year usually has 52 weeks; this year’s extra week falls in the fourth quarter and will flatter comparisons with a year earlier.

Disney also said it expected double-digit growth in adjusted earnings per share in fiscal 2027, excluding the extra week. Whether it keeps that outlook will say more about the year ahead than the layoffs do.

The calendar

This year’s timing invites a theory: cut before the call, and the cost story is ready when investors listen in. Three of Disney’s four rounds of cuts this year were first disclosed two to four weeks before an earnings report.

The longer record is less tidy. Mouse Money counted 26 distinct rounds of Disney job cuts since 2009, treating a news report and a memo about the same cuts as one round. Two were announced along with quarterly results. Of the other 24, 11 were first disclosed in the 30 days before an earnings report, against about 8 if the dates were random, and 8 in the 30 days after one. The sample does not establish a reliable pattern of layoffs clustering before earnings reports.

Unit chart of 24 rounds of Disney job cuts from 2009 to October 2026 by days until the next earnings report: 5 at 1 to 14 days, 6 at 15 to 29, 3 at 30 to 44, 2 at 45 to 59, 4 at 60 to 74 and 4 at 75 to 91. Eleven were first disclosed within 30 days before a report, against about 8 expected if the dates were random. Three of the 2026 rounds fall in the 15 to 29 day group and one in the 45 to 59 day group. Two rounds announced with quarterly results are excluded.

The stock

Share-price moves around most rounds were within Disney’s usual range of market-relative fluctuations. One standard deviation of Disney’s two-day move against the S&P 500 is about 1.75 percentage points. Over the first two sessions after each round was first disclosed, the gap was smaller than that 21 times out of 24, and Disney trailed the index by an average of 0.13 percentage point.

Three of the four rounds of about 1,000 jobs or more that were not announced with results were followed by two-day declines against the market, the largest after the 28,000 pandemic layoffs at the parks in September 2020, at 3.0 percentage points. Four rounds are too few to draw a conclusion, and the count depends on how two of them are dated.

This week’s reaction is hard to read. The Times story appeared shortly before the market closed on Oct. 28, so most of that day’s trading came before it. On Oct. 29, the first full session after the report, Disney rose 1.7% while the S&P 500 fell 0.3%.

Talk first, cut later

In two cost pushes, Disney signaled cost reductions in earnings communications before employees received layoff notices. The first ran from late 2022 into 2023. On its November 2022 earnings call, Christine McCarthy, then Disney’s finance chief, told analysts, “We are actively evaluating our cost base currently, and we’re looking for meaningful efficiencies.” Three days later, Bob Chapek, then the chief executive, sent a memo saying Disney was “limiting headcount additions through a targeted hiring freeze” and that “we do anticipate some staff reductions as part of this review.” Bob Iger, who replaced Chapek later that month, announced 7,000 job cuts on the February 2023 earnings call, and the layoffs came in three waves starting in late March.

Timeline of Disney cost signals and the job cuts that followed. Nov. 8, 2022 earnings call: finance chief Christine McCarthy said Disney was actively evaluating its cost base; a hiring-freeze memo followed three days later. Feb. 8, 2023 earnings call: Bob Iger announced 7,000 job cuts and $5.5 billion of annual savings; layoff waves followed 47, 75 and 103 days later. Aug. 5, 2026 earnings release: Disney said it was evaluating reductions in labor and SG&A; cuts in human resources and technology and in the parks division followed 55 and 84 days later, and the next report comes on Nov. 17, 104 days later.

This year the signal came in writing. On Aug. 5, Disney’s earnings release said the company was “evaluating a variety of levers, including reductions in labor and SG&A,” and that it was “mid-stream in this work.” The human resources and technology cuts came 55 days later, and the parks division cuts 84 days later.

Not every round fits. The Wall Street Journal reported April’s cuts before Disney announced them, July’s cuts came before the August release, and the 2020 parks layoffs, announced in a memo from D’Amaro, then the parks chairman, were forced by closures during the pandemic. Two cost pushes cannot establish a rule, but they suggest where to look.

The headcount question

Critics have long argued that Disney costs too much to run, and its workforce grew 74% from fiscal 2006 to fiscal 2025, to about 231,000. Headcount alone does not establish excess overhead. Disney’s workforce rose by about 22,000 in fiscal 2019, the year it acquired most of 21st Century Fox. Its fiscal 2020 annual report, which broke out employees by segment, showed about three-quarters working in parks, experiences and products, where hotels and rides need staff in a way that streaming does not. The activist complaints centered on overhead: Trian Fund Management said Disney’s selling, general and administrative expenses rose 85% from fiscal 2018 to fiscal 2022.

What Disney needs to answer on Nov. 17

The layoffs alone offer little basis for predicting an earnings beat or miss. The more consequential questions are how much Disney expects to save, when those savings will arrive and whether its outlook has changed. Disney has not put a figure on savings from this year’s cuts; in 2023, it promised $5.5 billion, later raising the target to $7.5 billion. Listen, too, for whether executives still say they are evaluating costs. In 2022 and again this year, that kind of language came before the layoffs.

What to watch on Nov. 17: Disney reports results for the fiscal fourth quarter, which ended Oct. 3, with analysts expecting adjusted earnings of about $1.69 a share; Disney's own forecast of about $4.9 billion of segment operating income, including about $600 million from a 53rd week; whether Disney still expects double-digit growth in adjusted earnings per share in fiscal 2027; how much the cuts will save and when; severance of $88 million in the third quarter and $180 million in nine months, which Disney leaves out of adjusted earnings; and whether executives still say they are evaluating costs.

Mouse Money will break down Disney’s results after the Nov. 17 report, including what the company says about costs.

If this was forwarded to you, subscribe to get our Nov. 17 breakdown.

How we did this

We counted a round of job cuts when a company statement, memo, filing or credible news report first disclosed it, from January 2009 through Oct. 28, 2026. Later reports that carried out, enlarged or confirmed a round already disclosed were folded into it: the April 2026 news report and memo are one round, as are the February 2023 announcement and its three waves, the February 2009 parks reorganization and the 1,900 parks job cuts that followed in April, and the 2020 parks layoffs and their later increase. ESPN’s June 2023 on-air cuts count as a separate round because CNBC reported they were separate from the 2023 restructuring. That leaves 26 rounds from 32 announcements. Two of the rounds were not layoffs as such: the January 2009 buyout offer to parks executives and the November 2022 hiring-freeze memo, which said Disney anticipated staff reductions. Grouping is a judgment. Folding the November 2022 memo into the 2023 restructuring, or the January 2009 buyouts into that year’s parks reorganization, leaves the result at 11 of 23 or 24 rounds in the 30 days before a report. A one-sided binomial test gives p between 0.10 and 0.13, which we treat as a rough guide, not a definitive test.

Sizes are as reported, often by unnamed sources; “several hundred” is counted as 300, and a round’s size is the largest figure reported for it. Day 0 is the first trading session that could react: the day of the news if it broke before the 3 p.m. Central close or the time is unknown, and otherwise the next session. We dated The Wall Street Journal’s April 8, 2026 report to April 9 because the earliest follow-up reports we found appeared that morning; dated to April 8, the April round would show a gain against the market. The stock measure is Disney’s daily change, using dividend-adjusted prices from Yahoo Finance, minus the S&P 500’s, over two sessions; its standard deviation since 2006 is about 1.75 percentage points.

Earnings forecasts and results are Yahoo Finance’s adjusted figures; other providers may differ slightly. The 21 quarters that followed layoff news are the first reports after each disclosure of cuts. They include February 2023, which followed the November 2022 memo, and exclude May 2016, when Disney announced the cuts with its results. The 49 other quarters are the rest of Disney’s reports from February 2009 to August 2026. Counting only the quarters that followed a new round gives 19 of 20, against 39 of 50 for the rest. Headcount comes from Disney’s annual reports. Prices were checked through Oct. 29, 2026.

This article was updated on Oct. 30, 2026, after it was first sent by email. The revision counts distinct rounds of job cuts rather than separate announcements, which changed the timing and stock figures; adds Disney’s own fourth-quarter forecast and when the quarter ended; and shortens the article, removing comparisons of revenue per employee over time and with other media companies, a comparison with other companies’ 2026 layoffs and a passage on Disney’s hiring from Character.AI.

Sources

]]><![CDATA[Everyone Is Talking About Disney Debt. Disney Isn’t.]]>https://substack.mousemoney.co/p/everyone-is-talking-about-disneyhttps://substack.mousemoney.co/p/everyone-is-talking-about-disneyThu, 29 Oct 2026 13:45:56 GMT
Cover illustration of a receipt, a ticket stub, a credit card and a stack of coins on a tomato-red background, with the headline Everyone is talking about Disney debt. Disney isn't. Who borrows, what the company says, and how people feel about it. Stats: 24% of Disney-goers say they have gone into debt for a Disney trip, averaging $1,690 (2024 survey); 0 times Disney's top executives discussed the Disney Visa or vacation club loans in eight calls and investor talks we reviewed, 2024 to 2026; Google searches for Disney expensive are 2.2 times their 2021 level.

On Wednesday, the Los Angeles Times reported that Disney’s theme parks division was laying off 100 to 200 people. Disney declined to comment. Fan sites reported that Walt Disney Imagineering, the unit that designs its rides and lands, was among the teams hit. It was the third round of Disney job cuts this year to begin two to three weeks before an earnings report, and the company had told investors to expect more. “We remain highly focused on reducing costs across the enterprise,” Josh D’Amaro, the chief executive, and Hugh Johnston, the finance chief, wrote in the company’s August earnings release, adding that they were “evaluating a variety of levers, including reductions in labor and SG&A.”

This is a company watching its money. D’Amaro, who took over in March, says Disney creates long-term value when it operates with “speed, discipline, and efficiency.” Disney expected to spend about $9 billion on capital projects in the fiscal year that ended Oct. 3, much of it on new attractions and cruise ships, under a plan announced in 2023 to put about $60 billion into its parks and cruises over roughly a decade. It also planned to spend at least $9 billion buying back its own stock. And the parks are thriving: operating income in the Experiences segment rose 20% in the quarter ended June 27, to $3.02 billion, about four points of it from a tariff refund.

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Many of its customers are stretching. A quarter of Disney-goers told LendingTree, an online loan marketplace, in 2024 that they had gone into debt for a Disney trip, and those who did borrowed an average of $1,690. Google searches for “Disney expensive” are at a record, more than twice their 2021 level. Fans even have a T-shirt for it: “Most Expensive Day Ever,” a fan-made twist on “Best Day Ever,” a slogan Disney has printed on shirts sold on Main Street, U.S.A. Disney, which offers guests several ways to pay later, says almost nothing about the borrowing.

The stakes are large. Experiences, the segment that includes the parks, produced 57% of Disney’s segment operating income in fiscal 2025. And Disney is mostly paid up front. A vacation package has to be paid in full 30 days before arrival, so Disney has the money before the family gets there. When that money is borrowed, it is borrowed from Chase, from PayPal and its partner bank, or from another card issuer or lender, and they and their investors, not Disney, carry the risk of not being repaid. The main exception is Disney Vacation Club, the company’s timeshare business, where Disney lends to buyers. The risk for Disney is not that its customers default. It is that they stop saying yes.

The customers

Who borrows, and how much

LendingTree, which is paid by lenders when it passes along consumers’ loan requests, surveyed Disney-goers about debt in 2022 and 2024. In the 2024 survey, 24% of adults who had been to a Disney park said they had gone into debt for a Disney trip, up from 18% in 2022. Among Disney-going parents of children under 18, the share rose to 45% from 30%. Both were online opt-in polls run by different vendors, so the increase is a signal rather than a measured trend. The question also counts any trip ever taken: fewer than a third of the 2024 borrowers said they had done it in the past year.

The sums are modest by the standards of household debt. Borrowers reported an average of $1,690, and parents $1,983. Three in four said it would take, or took, six months or less to repay, and 64% said they had no regrets. At 22.36%, the average rate on bank credit card accounts assessed interest in August 2026, repaying $1,690 in six equal monthly payments would cost about $112 in interest.

Bar chart: share of Disney-goers who say they have gone into debt for a Disney trip, 18% in 2022 and 24% in 2024; Disney-going parents of kids under 18, 30% in 2022 and 45% in 2024; by household income in 2022, 26% of those earning $100,000 or more and 12% of those earning $35,000 to $49,999. Average Disney debt among borrowers in 2024: $1,690 overall and $1,983 for parents. Source: LendingTree online surveys.

It is not only a story about stretched budgets. In the 2022 survey, 26% of Disney-goers earning $100,000 or more said they had borrowed for a trip, against 12% of those earning $35,000 to $49,999, the only two income groups LendingTree published. Disney has described the same divide. In August 2024, Johnston told investors that “the lower-income consumer is feeling a little bit of stress. The high-income consumer is traveling internationally a bit more.” Card data showed it the next summer: spending at U.S. theme parks fell 5% from a year earlier, with the weakness among visitors earning under $100,000, Forbes reported, citing Consumer Edge, while Bloomberg Second Measure data put spending by Disney park visitors up 8% from May through July.

In 2024, The New York Times profiled Alyssa Leach, whose household earns about $250,000. For a 2022 trip, she charged about $6,000 to her Disney-branded credit card, paid the minimum for two months and ran up about $382 in interest. “I’ll make more money,” she told the paper. “But he’ll never be that young again,” she said of her son.

The extreme cases are the ones that spread. Accounts of a New Yorker article in May describe AJ Wolfe, the author of a book about Disney adults, who ran up about $17,000 of Disney debt in the early 2000s, and a Columbus high school teacher who owes $3,000 for her next trip. On Caleb Hammer’s YouTube show “Financial Audit,” a 26-year-old Orlando barista with $50,000 of consumer debt, bragging about a planned trip to Disneyland, said of her splurges: “I could die tomorrow, so I’m spending money today.” One Instagram user joked, “My retirement plan is just vibes and pixie dust,” Moneywise reported. None of that is typical. The average borrower in LendingTree’s survey took on $1,690, and three in four said they had repaid, or expected to repay, within six months.

Borrowing for a big occasion is common. In LendingTree surveys, 67% of newlyweds said they took on debt for their weddings, and 37% of consumers said they took on holiday debt in 2025, averaging $1,223. In a Bankrate poll, 29% of Americans planning summer trips in 2025 said they would take on debt for them, down from 36% the year before. Buy now, pay later has become ordinary too: 16% of adults had used it in the previous 12 months when the Federal Reserve surveyed households in October 2025, one of the few probability samples on the subject.

What the trip costs

The price of the trip has climbed. By the fall of 1982, a one-day ticket to the Magic Kingdom cost $15, and four of them took about one day of the median American household’s income. On the most expensive days of 2026, four cost $836 before tax, about three and a half days of income. Even on the cheapest days, they take more than two. Disney has already set the Magic Kingdom price for Christmas Day and New Year’s Eve 2027 at $229 a ticket.

Column chart of days of U.S. median household income needed for four one-day Magic Kingdom adult tickets: 1.1 days in 1982 ($15 ticket), 1.5 in 1990 ($31), 1.6 in 2000 ($46), 2.4 in 2010 ($82), 2.7 in 2015 ($105), 2.3 to 3.4 in 2019 ($109 to $159) and 2.3 to 3.5 in 2026 ($139 to $209).

The extras add up faster than the tickets. A four-day Walt Disney World trip for a family of four, staying at a value resort, cost about $4,266 in 2024, against $3,230 for the same trip five years earlier in inflation-adjusted dollars, according to a TouringPlans analysis for The Wall Street Journal. Nearly 80% of the increase came from charges for services that used to be free, such as skipping lines. Files leaked in 2024 and reported by the Journal showed that Genie+, Disney’s paid line-skipping service, brought in more than $724 million of revenue at Disney World between October 2021 and June 2024.

The company

What Disney says, and what it doesn’t

Disney has not addressed guests’ borrowing directly. For a 2024 New York Times article about families going into debt for Disney vacations, a Disney spokesperson said the company offered vacation options at multiple price points; Disney representatives did not respond to Business Insider on the same subject that year. In eight earnings calls and investor appearances from 2024 through 2026 whose transcripts we reviewed, Disney’s top executives never discussed the Disney Visa or vacation club loans.

The annual report is nearly as quiet. Disney’s report for fiscal 2025 does not mention a credit card, Visa or Chase. It reports revenue from “sponsorships and co-branding opportunities” in a line called parks licensing and other, along with real estate rent and sales and royalties from Tokyo Disney Resort. That line brought in $2.36 billion in fiscal 2025, about 6.5% of the Experiences segment’s $36.2 billion of revenue, and Disney does not say how much of it comes from the card. The lending gets a sentence: Disney had $1.0 billion of receivables with original maturities of more than a year at the end of fiscal 2025, “primarily related to the sale of vacation club properties,” and it called credit losses on them “not material.” In a filing for the first quarter of fiscal 2025, it said $0.7 billion of the prior year-end balance was vacation club receivables.

What Disney does talk about is price and choice. “We intentionally offer a wide variety of ticket, hotel, and dining options to welcome as many families as possible, whatever their budget,” D’Amaro, then the chairman of Disney Experiences, said in a company article in February 2025. In the same article, Johnston said Disney had “worked hard to make a Disney vacation accessible to guests of all income levels.” At the annual meeting in March, on his first day as chief executive, D’Amaro told shareholders, “I know that a Disney Park visit, it’s a meaningful investment for families that visit us,” and added, “we want this experience to be the best day of a guest’s life,” according to WDW News Today, a fan news site.

With investors, executives have been more candid. “I’ve always believed that Disney was a brand that needed to be accessible,” Bob Iger, then Disney’s chief executive, told an investor conference in March 2023. “And I think that in our zeal to grow profits, we may have been a little bit too aggressive about some of our pricing.” In November 2025, at another conference, Johnston said that “our consumer, as you know, tends to be at the higher income deciles, and those consumers continue to do well,” adding, “we certainly, broadly feel good about where the consumer is.”

Taken away, given back

Disney has cut some prices and raised others. The company says “it’s important to us to offer a variety of ticket, hotel, and promotional offers during the year,” and the deals are real. Walt Disney World’s new after-2 p.m. tickets for the summer of 2026 started at $235 for two days. A four-day ticket covering one visit to each of the four parks, for visits from late May to early October, started at $109 a day. Hotel rooms were up to 30% off for much of the summer and early fall, Florida residents could get up to 35% off, and children 3 to 9 ate free with a resort package and an adult dining plan. In California, Disneyland sold kids’ summer tickets from $50 and offered Anaheim residents one-day tickets for $71.

So are the fees. Line-skipping, free under the old FastPass+ system, became Genie+ at $15 a person a day in October 2021. Its successor, Lightning Lane Multi Pass, has cost $16 to $45 a person a day in 2026, depending on the park and date, according to fan sites that track it. The top tier, Lightning Lane Premier Pass, runs as high as $449 a person at Magic Kingdom. The free Magical Express bus from Orlando’s airport ended on Jan. 1, 2022; Mears Connect, run by the company that operated it, now charges adults $16 each way plus a fuel surcharge. MagicBands, the wristbands that work as park tickets and room keys, were once free for resort guests and now cost $34.99 and up. Parking at the theme parks for day guests has gone from $25 in 2018 to $35. One change went the other way: in January 2023, Disney dropped the overnight parking fees it had begun charging hotel guests in 2018.

D’Amaro has made clear that the deals are targeted. The value offers are “designed to reach a specific guest,” he said on the company’s August earnings call, and with spending per guest up 4%, “we’re certainly not discounting our way to volume growth.” In the quarter ended June 27, attendance at Disney’s domestic parks rose 3%, and per capita guest spending rose 4%.

Receipt-style table of Walt Disney World costs then and now. Taken away or raised: skipping the line, free then, $16 to $45 a day now; airport bus, free then, $16 each way now; MagicBand, free then, from $34.99 now; theme park parking, $25 in 2018, $35 a day now. Given back: hotel parking, $15 to $25 a night then, free now; kids' dining, free with select 2026 packages; hotel rooms up to 30% off for select 2026 stays; new after-2 p.m. tickets, two days from $235.

The checkout

Disney’s payment page invites guests to “pay a deposit at the time of booking then pay the remaining balance in customizable installments.” Its package terms set the deposit at $200 for trips booked more than 30 days out and require payment in full 30 days before arrival. PayPal’s Pay in 4 covers purchases of $30 to $1,500, with 25% down. Pay Monthly covers $49 to $10,000; Disney’s payment page lists fixed annual rates of 9.99% to 26%, and PayPal’s own terms run as high as 35.99%.

The free periods are short. Pay in 4 runs six weeks. The Disney Visa’s 0% offer, on select Disney vacation packages and cruises, lasts six months from the purchase, so a package balance charged a month before the trip stays interest-free for about five months after it. After that, the card charges new accounts 18.49% to 27.99%, a range that brackets the 22.36% average.

Rate chart of annual percentage rates on ways to pay Disney later: PayPal Pay in 4 at 0%, four payments over six weeks; Disney Vacation Club loan from Disney at 15.013% on its sample 15-year loan; Disney Visa from Chase at 0% for six months on select packages, then 18.49% to 27.99%; PayPal Pay Monthly at 9.99% to 26% per Disney's payment page. Reference line: the 22.36% average rate on card accounts charged interest in August 2026.

The card has carried Disney’s name since 2003 and now comes in three versions. The newest, the Disney Inspire Visa, launched in February with a $149 annual fee. Chase, which called itself the largest co-brand card issuer in the U.S. when it renewed the program in 2022, did not disclose how long the renewal runs or its terms. At the Inspire launch, Cathy Cline, Disney’s senior vice president of corporate alliances and consumer financial services, said the card “is sure to be a Disney fan’s go-to card in their wallet.” The card’s vacation financing page carries the tagline “Make your Disney vacation magic happen.” The most recent cardholder figure we could find is from 2008: “over 2 million Cardmembers joining since its launch in 2003.”

Disney as lender

Disney Vacation Club has sold ownership interests in 17 resort properties, priced in points that members trade for stays. Disney will lend buyers the money. In April 2025 it began offering 15-year loans on direct purchases, up from a standard 10 years. Its current sample, on the vacation club’s website, is 100 points at Polynesian Villas & Bungalows, priced at $24,300. With 10% down, the buyer borrows $22,603, including closing costs, and pays $316 a month for 15 years, an annual percentage rate of 15.013%. Over 180 payments that comes to $56,880, of which about $34,300 is interest, more than the price of the points. Annual dues on those 100 points, $69.42 a month in 2026 and “subject to increase,” come on top. Membership at the resort ends on Jan. 31, 2066.

Disney’s pitch is that ownership pays for itself. Compared with renting the same rooms, “savings can begin approximately 6 to 14 years after purchase,” the site says. That illustration assumes a cash purchase.

Bar chart of Disney's sample Disney Vacation Club loan for 100 points at Polynesian Villas & Bungalows: price of the points $24,300; amount borrowed $22,603; total of 180 monthly payments of $316 is $56,880, of which $34,277 is interest.

When owners fall behind, Disney’s side of the loan has teeth. Palm Financial Services, the Disney affiliate that handles foreclosures on vacation club interests that Disney financed, handled 928 of them in Orange County, Fla., in 2014 and more than 900 in 2015, according to county records reported by the Orlando Sentinel. In 2019, Disney filed 2,406 liens with the Orange County comptroller, according to DVCNews, which tied them to owners behind on loan payments or annual dues. The vacation club also moves Disney’s results: the company cited “lower sales of Disney Vacation Club units” in the fourth quarter of fiscal 2024 and higher unit sales in the second quarter of fiscal 2025.

How people feel

When Disney became “expensive”

Search data shows when the idea that Disney is expensive took hold. U.S. Google searches for “Disney expensive” and “is Disney worth it” have climbed almost every year since 2009. One big step came in 2022, the first full year after Disney began charging for line-skipping and ended its free airport bus, when searches for “Disney expensive” rose about 40%, though Google also changed how it collects the data that January. This year both searches are at records, with “Disney expensive” running 34% above the same months of 2025. Searches for “Disney World tickets” were flat to lower over the same period, so the rise is not simply more people searching for Disney.

Line chart of U.S. Google search interest from 2009 to 2026 for Disney expensive and is Disney worth it. Both rise almost every year, jump in 2022 and reach records in 2026, at about 83 and 85 on an index where 100 is the busiest month. Milestones: seasonal ticket prices in February 2016, date-based prices in October 2018, paid line-skipping in October 2021, the end of the free airport bus in January 2022, and tickets topping $200 in October 2025.

The worry is older than the searches. In 2015, the year a one-day Magic Kingdom ticket first passed $100, The Washington Post described how theme parks “left the middle class behind.” Robert Niles, the editor of Theme Park Insider, told the Post that parks would “set their prices at the top 10 percent of family incomes and make their money where the money is.” By 2025, Len Testa of TouringPlans had concluded that “Disney prices its theme parks for the top 20% of American households by income.”

Debt goes public

Debt has also moved into public view, and Disney’s marketing runs through the same feeds. The company worked with about 6,000 creators in 2026, 30% more than the year before, and their posts drew nearly 12 billion impressions, the Los Angeles Times reported this month. The same feeds that sell the trip carry posts about paying for it. “Disney adults,” grown fans who visit without children, became a favorite target online around 2020; Rolling Stone called them the internet’s most hated group. The New Yorker asked in May whether they are “the happiest debtors on Earth.” George Kamel, a personality at Ramsey Solutions, the debt-free advice company, posted a video last November of himself asking tourists at Disney Springs how much debt they carry. Most of what they described was car loans, student loans and card balances, not Disney trips.

Seeing other people’s vacations does move money. In a 2023 Credit Karma poll, 38% of Gen Z adults and 28% of millennials said they had spent money they didn’t have on travel after seeing other people’s vacations on social media, compared with 15% of Gen X and 7% of baby boomers and older adults. A 2013 study in the Journal of Consumer Research linked heavier social network use with higher credit card debt among people with strong ties to their online network. The pull has limits: in a December 2025 LendingTree poll, travel and experiences made up just 3% of the purchases people said they made after seeing them on social media.

Younger adults are more open about money than their elders. More than half of Gen Z adults told Bankrate in 2024 that they were comfortable talking about money with the people closest to them, against fewer than 30% of baby boomers. Debt itself still carries shame. In a 2018 Credit Karma survey, 73% of millennials who had gone into debt to keep up with friends said they had kept it a secret.

The happiest place, the most stressful bill

Money is among the heaviest worries Americans carry. In the American Psychological Association’s 2026 Stress in America survey, 77% of adults named the cost of living as a significant source of stress. In its 2023 survey, 58% of parents said money caused fights in their family, against 30% of other adults. Researchers who followed 4,574 couples found that disagreements about money predicted divorce more strongly than other common disagreements. “It’s not children, sex, in-laws or anything else. It’s money,” Sonya Britt, one of the authors, said in a 2013 release.

How families pay may matter as much as how much. In a classic study of mental accounting, Drazen Prelec and George Loewenstein found that most people would rather pay for a vacation before they take it, so it can be enjoyed “without thinking about the need to pay.” Disney’s deposit plan, with the balance due before arrival, works with that instinct. A card balance that lingers after the trip works against it. Paying later also tends to mean spending more. In auctions with real money, Prelec and Duncan Simester at MIT found that telling people to pay by credit card could raise what they were willing to pay by as much as 100%. A 2022 National Bureau of Economic Research working paper found that when shoppers gained access to buy now, pay later, their total spending rose and stayed higher.

The memories may be thinner than the bill. Research going back to a 2003 study by Leaf Van Boven and Thomas Gilovich finds that experiences tend to make people happier than possessions. But a 2010 Dutch study of 1,530 people found vacationers were happier than non-vacationers before their trips, and generally no happier afterward. And a trip with a toddler may not last in the child’s memory. Children asked at 8 and 9 about events they had discussed at age 3 remembered fewer than 40% of them, though researchers in 1991 found that children who had visited Disney World at 3 or 4 still recounted a great deal of it six or 18 months later.

Put together, the research describes the best Disney trip as one paid off before the gate opens: months of looking forward to it, the stretch when the Dutch study found vacationers happier than people staying home, and no bill afterward. Disney’s deposit plan is built for that kind of trip. The card that carries its name is built for the other kind.

What would change our view

Our read is that Disney’s exposure to its customers’ debt is mostly indirect. It is paid up front, and the risk sits with lenders and families, except for about $1 billion of long-term receivables tied mostly to the vacation club. That would change if Disney began calling credit losses on those loans material, or if per capita spending at its domestic parks fell while card delinquencies rose. The next test comes on Nov. 17, when Disney reports results for its fiscal fourth quarter and may say how big the latest job cuts were.

What we are watching: Nov. 17, Disney's fiscal fourth-quarter results; November, Disney's annual report and its vacation club receivables; November, the New York Fed's household debt report; spring 2027, the Federal Reserve's survey of household finances. What would change our view: material credit losses on vacation club loans, or falling per capita spending alongside rising card delinquencies.

How we did this

Days of income are four times the one-day, one-park adult Magic Kingdom ticket price before tax, divided by U.S. median household income for that year over 365 days. Single-price years use the price in effect at year-end: from the fall in 1982, February in 1990 and 2015, January in 2000 and August in 2010. For 2019 and 2026 we used the year’s lowest and highest prices; 2026 prices are compared with 2025 income, the latest Census figure. Search interest comes from Google Trends for the U.S., retrieved Oct. 29, 2026, as annual averages of the monthly index, with 2026 covering January through October; comparisons with earlier years use the same months. The interest example assumes $1,690 repaid in six equal monthly payments at 22.36%, the Federal Reserve’s preliminary August 2026 rate on bank credit card accounts assessed interest. The vacation club figures are Disney’s published sample as of Oct. 29, 2026, with total repayment calculated as $316 times 180. The LendingTree, Bankrate and Credit Karma polls are online opt-in samples; the Federal Reserve survey is a probability sample. D’Amaro’s remarks at the 2026 annual meeting are as reported by WDW News Today; Disney’s official transcript of the meeting covers only its business portion. Social posts quoted here were reported by the outlets named and could not be independently verified. Web pages were checked on Oct. 29, 2026.

Sources

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]]><![CDATA[For Disney to Win, Universal Doesn’t Have to Lose]]>https://substack.mousemoney.co/p/for-disney-to-win-universal-doesnthttps://substack.mousemoney.co/p/for-disney-to-win-universal-doesntWed, 28 Oct 2026 13:48:36 GMT
Cover graphic: For Disney to win, Universal doesn’t have to lose. Epic Universe drew an estimated 4.0 million visits from May 22 to Dec. 31, 2025; estimated visits at Disney World’s four parks fell 0.2% in 2025; spending per guest at Disney’s U.S. parks rose 59% from fiscal 2019 to fiscal 2025.

Universal opened its first new Orlando theme park in 26 years in May 2025. By the end of that year, Epic Universe had drawn an estimated four million visits, and attendance at Walt Disney World’s four parks had slipped just 0.2%. For Disney to win in Orlando, the record shows, Universal doesn’t have to lose.

Those figures come from the Themed Entertainment Association’s annual attendance estimates, released Oct. 27, the closest thing the industry has to an official scoreboard. Mouse Money compiled those estimates for every major Orlando park in most years since 2009 and checked them against company filings, hotel data, tourism counts and airport traffic. The review supports the case that the rivalry is not a zero-sum contest. It also found that the comparison those estimates imply, that Disney World remains about 17% below its 2019 attendance, is the one the other evidence supports least.

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One new park, one steady incumbent

Universal’s Orlando attendance rose about 19% in 2025, to an estimated 22.5 million visits across three parks, according to TEA’s figures as reported by Attractions Magazine. Epic accounted for 4.0 million in roughly seven months of operation. Universal Studios Florida and Islands of Adventure together lost about 450,000 visits, consistent with some guests moving days to the new park.

Disney World’s four parks drew an estimated 49.0 million visits, about 99,000 fewer than in 2024. SeaWorld Orlando, the city’s third major operator, was essentially flat at 4.3 million.

Line chart of estimated annual theme-park visits, 2015 to 2025. Walt Disney World’s four parks peaked at 58.8 million in 2019 and drew 49.0 million in 2025, down 0.2% from 2024. Universal Orlando’s parks drew 22.5 million in 2025, up 18.7%, after Epic Universe opened May 22, 2025; Universal’s two older parks drew 18.5 million.

Disney’s own disclosures point the same way. Attendance at its U.S. parks fell 1% in the fiscal year ended Sept. 27, 2025, which included four months of Epic. In the three quarters that followed, the first with Epic open throughout, Disney reported changes of +1%, -1% and +3%.

Chief Financial Officer Hugh Johnston said in November 2025 that Epic’s effect on Disney was “very much in line with our expectations” and suggested it was hurting other competitors more. TEA’s estimates suggest the parks most affected were Universal’s own: Universal Studios Florida and Islands of Adventure fell 2.4% combined, compared with 0.2% at Disney World and 0.3% at SeaWorld Orlando. Advan Research’s foot-traffic data pointed the other way: its November 2025 report showed visits to those two Universal parks above the prior year.

Universal’s gains showed up in Comcast’s results. Its theme parks segment, which also includes Hollywood, Japan and Beijing, increased revenue 14.2% in 2025 to $9.84 billion, which Comcast attributed mainly to Epic. Adjusted earnings before interest, taxes, depreciation and amortization rose a smaller 4.5%, to $3.08 billion, as Epic’s operating costs grew, according to Comcast’s annual report.

The record before Epic

Shared growth is not new to Orlando. From 2015 to 2019, estimated attendance at Disney World’s four parks rose 8.8% to 58.8 million, and Universal’s two parks rose 15.9% to 21.3 million. Together they added about 7.7 million visits. Disney’s share of the two companies’ combined attendance fell by 1.2 percentage points over that period, while its own attendance rose by about 4.7 million.

Universal’s previous big openings tell a similar, if uneven, story. In 2010, when the Wizarding World of Harry Potter opened at Islands of Adventure, that park’s attendance rose 30.2%; three of Disney’s four parks declined and Animal Kingdom grew, leaving Disney World down 0.9%. In 2014, when Diagon Alley opened at Universal Studios Florida, that park rose 17% and all four Disney parks grew, lifting Disney World 2.7%. In none of the three opening years did Disney World’s estimated attendance fall by more than 1%.

Column chart of the annual change in estimated visits at Walt Disney World’s four parks. In the years Universal opened a major land or park, Disney World changed by -0.9% (2010), +2.7% (2014) and -0.2% (2025). Other years ranged from -0.6% to +4.9%. Changes for 2011 to 2013 and 2020 to 2022 are not shown.

That history establishes that both resorts can grow at once. It does not show that one caused the other’s gains. A strong economy, rising air travel and each company’s own investments, such as Pandora at Animal Kingdom in 2017, could lift both.

A scoreboard with a blind spot

The longer comparison raises a different question. TEA’s estimates put Disney World’s 2025 attendance 16.6% below 2019, and the two companies’ combined total 10.7% lower, even with a new park. More than half of Disney’s estimated shortfall sits at Animal Kingdom, which TEA puts at 8.8 million visits, compared with 13.9 million in 2019.

The other gauges we examined tell a different story. Visit Orlando, the region’s tourism agency, counted a record 76.7 million visitors in 2025, about 1% more than the 75.8 million it counted in 2019. Metro Orlando’s hotels sold about as many room nights in the first nine months of 2025 as in the same period of 2019, according to STR data in Visit Orlando’s quarterly reports. In 2023, STR changed how it estimates figures for hotels that do not report data, so the two years may not be strictly comparable. Orlando International Airport handled 57.7 million passengers, 14% more. Disney’s own U.S. hotels filled about 1% fewer room nights in fiscal 2025 than in fiscal 2019, based on the occupancy and available room nights in its annual reports.

Bar chart of the change from 2019 to 2025 in selected measures: Orlando airport passengers +13.9%, Orlando visitors +1.1%, metro hotel room nights sold +0.1%, room nights at Disney’s U.S. hotels about -1%, compared with TEA estimates of -12.4% for Disney’s six U.S. parks and -16.6% for Disney World’s four parks.

Disney’s attendance disclosures support those gauges more than they support the estimates. Disney does not publish attendance counts for its parks, but it reports the annual change at its U.S. parks, Disney World and Disneyland combined. In August 2022, then-CFO Christine McCarthy said average daily attendance at those parks over the first three quarters of that fiscal year was “slightly below 2019.” Since then, Disney has reported increases of 6% and 1% and a decline of 1%. Chained together, those figures put Disney’s U.S. parks within a few percent of their 2019 attendance. Disney has not said so, and the starting point is a qualitative remark about months when the company was limiting entry through reservations. TEA’s estimates for the same six parks were 16.5% below 2019 in 2022 and remain 12.4% below.

The two measures have moved roughly in step since 2022: Disney reported growth of about 6% over those three years, and TEA’s estimates rose about 5%. The gap opened during the pandemic and has not closed.

There are reasonable explanations, and they do not all point the same way. Disney counts each guest once a day, however many parks they visit; TEA counts park visits. Disney limited park hopping to afternoons from 2021 until January 2024, which would have reduced park visits relative to Disney’s count, though the gap has persisted since the restriction ended. Disney’s figures also include Disneyland, and its fiscal year ends around Sept. 30.

TEA’s figures are estimates. The association builds them from operator information, financial reports, tourism data, mobile location analytics and professional judgment, according to Attractions Magazine’s account of the report. Its 2025 edition shows the same 0.2% decline at each of Disney World’s four parks and the same 0.4% increase at both Disneyland parks, a pattern consistent with a resort-wide estimate applied park by park. When each year’s estimate builds on the last, an error introduced in an unusual year can persist.

None of this proves the estimates wrong. Visitors could be spending fewer of their days in theme parks than they did in 2019, for example. But the finding that Disney World is still about 17% below its pre-pandemic attendance comes from a single estimate. None of the other measures we examined corroborates it, though none of them counts park visits directly.

Where the money comes from

What the companies do report clearly is how much more each guest spends. Disney’s spending per guest at its U.S. parks, which covers tickets, paid Lightning Lane access, food, drinks and merchandise, has risen about 59% since fiscal 2019, based on the annual changes in its 10-K filings. Consumer prices rose about 26% over the same period, according to the Bureau of Labor Statistics.

Published one-day prices rose far more slowly than spending per guest. Magic Kingdom’s highest one-day price rose from $159 in 2019 to $199 in 2025, and its lowest from $109 to $139, gains of 25% and 28%, roughly in line with inflation. The difference reflects what guests buy beyond a basic one-day ticket, including paid ride access, food and merchandise, and which dates and tickets they choose.

Line chart indexed to 2019 = 100. Spending per guest at Disney’s U.S. parks rose 59% by fiscal 2025, compared with 26% for U.S. consumer prices and 25% for Magic Kingdom’s highest one-day ticket price, which held at $159 until December 2022.

Disney’s U.S. parks and experiences business, which also includes its cruise line and vacation club, increased revenue 45% from fiscal 2019 to fiscal 2025, to $25.2 billion, and operating income 44%, to $6.4 billion. Orange County’s tourist development tax, a 6% levy on hotel and short-term rental stays, brought in a record $384.6 million in the year ended Sept. 30, 2025, about 35% more than in fiscal 2019, while the metro area’s hotels sold about the same number of room nights.

That is the economic logic beneath the shared growth. Disney has grown by earning more from each visit, with attendance that its own disclosures suggest is near its 2019 level. Universal has grown by adding capacity.

Room for a longer stay

Universal has more than doubled its Orlando hotel inventory in a decade, from about 4,200 rooms in 2015 to about 11,000 in 2025, including three hotels that opened alongside Epic. Disney’s on-site inventory at Disney World has barely changed, at about 23,000 hotel rooms plus some 3,900 vacation-club units. Universal now holds about 29% of the two companies’ on-site rooms, up from 14%.

Bar chart of on-site hotel rooms including vacation-club units. Walt Disney World had about 26,000 in 2015 and 26,900 in 2025, up 3%. Universal Orlando had about 4,200 in 2015 and 11,000 in 2025, up 162%. Universal’s share of the two companies’ on-site rooms rose from 14% to 29%.

Rooms are what turn a day trip into a week. Universal’s three-park tickets and hotel perks are built to keep a family at Universal for several days, and that is where the two companies can still collide. A family with a fixed budget that adds an Epic day may drop a Disney day; a family that extends its trip creates spending for both. Annual totals cannot show which happened. Disney’s steady attendance suggests most of Epic’s visits did not come out of Disney’s parks, while Universal’s older parks gave up about 450,000.

Table of analyst views. MoffettNathanson, April 2024: expected Epic Universe to cost Disney World about 1 million visits across 2025 and 2026. Michael Nathanson, August 2025: Disney’s attendance largely unaffected. Advan Research, Nov. 3, 2025: Epic additive for Orlando. Bank of America, Sept. 29, 2026: underlying Experiences demand healthy.
List of upcoming data: Orange County’s hotel-tax total in early November; Disney’s fiscal fourth quarter on Nov. 17; Comcast’s fourth quarter in late January 2027; Visit Orlando’s 2026 visitor count in May 2027; Disney’s 2027 openings at Animal Kingdom and Hollywood Studios; TEA’s 2026 estimates in fall 2027.

What would change our view

Epic’s first year was a partial one, and Universal’s momentum has slowed since: its parks revenue fell 4.4% in the quarter ended Sept. 30, 2026, and Comcast co-Chief Executive Mike Cavanagh said competitors adapted their marketing faster to softer demand. Disney’s report on Nov. 17 will cover the summer that Universal found weak. TEA may also revise its approach, and the gap between its estimates and Disney’s disclosures could narrow from either direction.

If Disney’s reported U.S. attendance and TEA’s 2026 estimates both show Disney losing visits while Universal’s Orlando attendance grows, the case that this rivalry is not zero-sum is wrong.

How we did this

We compiled TEA’s estimates, produced with AECOM through 2023, for Orlando’s eight major theme parks, including Epic Universe, from each edition covering 2009, 2010 and 2013 through 2025, plus Disneyland and Disney California Adventure for 2019, 2022 and 2025, and found no later restatements of the figures we used. We compared them with Disney’s 10-K filings and earnings-call transcripts, Comcast’s filings, Visit Orlando’s visitor estimates and the STR hotel data it reports, Orlando International Airport’s traffic reports and Orange County’s tax collections. Growth rates and shares are Mouse Money calculations from the published figures.

Sources

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]]><![CDATA[Disney Still Has the Edge in Orlando. Universal Is Rethinking How It Competes.]]>https://substack.mousemoney.co/p/disney-still-has-the-edge-in-orlandohttps://substack.mousemoney.co/p/disney-still-has-the-edge-in-orlandoTue, 27 Oct 2026 13:57:36 GMT
Mouse Money cover: Disney and Universal are competing for the whole week. Magic Kingdom top one-day price $209 on the 2026 calendar; Disney domestic spending per visitor up 4% in the quarter ended June 27, 2026; Universal parks revenue down 4.4% in the quarter ended Sept. 30, 2026.

Universal's theme parks revenue fell 4.4% in the quarter ended Sept. 30, its first decline since Epic Universe opened. On the Oct. 22 earnings call, Comcast President Mike Cavanagh said competitors were quicker to recognize softening demand and adapt their marketing, and that Universal will answer with promotional packages, three-park passes and more media spending aimed at its Orlando parks. It has also hired a new head of marketing and pricing from an airline loyalty program.

Those moves matter because the real contest in Orlando is over a family's vacation days, not the price of one. Multiday tickets and hotel packages give visitors a reason to stay at one resort, which makes each additional day harder for the rival to win. On the evidence so far, Disney has played that game better, pairing targeted discounts with rising spending per visitor through June.

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One limit applies throughout. Neither company publishes an Orlando income statement: Disney's domestic parks business includes Disneyland and its cruise line, and Comcast's parks segment includes Hollywood and Japan. Their results show the direction of each business, not which resort is winning days in Florida.

Universal's new commercial push

Luc Bondar, formerly chief operating officer and president of United Airlines' MileagePlus program, started Oct. 19 as chief brand and commercial officer of Universal Destinations & Experiences, succeeding Alice Norsworthy, who retires at the end of the year after more than 18 years with the company. He oversees marketing, sales, pricing and revenue management, a combination that puts the levers for packaging extra days under one executive.

At United he ran a business built on getting customers to come back. Universal's announcement says it wants to use technology and data to build more personalized guest relationships and loyalty. Cavanagh did not give terms for the new passes. Universal already sells three-day, three-park deals introduced in September, starting at $99 a day, or $85 for Florida residents. The direction is clear: sell the whole resort as a destination, not just a new park.

The ceiling moved, the floor didn't

Disney's published price calendars show its approach. When it released 2026 prices in October 2025, a one-day Magic Kingdom ticket ranged from $139 to $209 before tax, up from $139 to $199. The floor held and the ceiling rose 5%. EPCOT, Hollywood Studios and Animal Kingdom followed the same pattern, with top prices up 5% to 8%.

Epic Universe's one-day prices ranged from $139 to $199 at both its 2025 launch and for 2026, overlapping Magic Kingdom's. Universal's two older parks start at $119. Epic was priced as an alternative to Disney's flagship, not a cheaper one.

The floor is a poor guide to what families pay. TouringPlans counted two days at Magic Kingdom's $139 minimum on the 2026 calendar. And the $229 peaks reported this month apply to holiday dates in 2027, so they say nothing about what this year's visitors paid.

Exhibit 1. One-day ticket price ranges, 2025 vs 2026 calendars. Magic Kingdom $139-$199 to $139-$209; EPCOT $129-$194 to $129-$209; Hollywood Studios $139-$194 to $139-$204; Animal Kingdom $119-$174 to $119-$184; Epic Universe $139-$199 both years.

What another day costs

The more revealing prices sit inside multiday tickets, where each added day gets cheaper. On Disney's calendar as of Oct. 26, a four-day ticket starting Sunday, Nov. 15, costs about $700 before tax for a guest 10 or older, or $175 a day. A five-day ticket for the same start costs about $785. The fifth day adds about $85.

A family weighing a day at Epic Universe on Thursday, Nov. 19, faces a different number. Epic's published one-day price for that date was $159 when Universal released its 2026 calendar. A family can rearrange its days or skip the extra one, but a day across town costs nearly twice as much as one more day at the resort it already chose. That gap is what multiday tickets are designed to create, and what Universal's three-park passes are meant to answer.

The offers differ in what they include. Universal's 2026 multiday tickets allow repeat visits to Epic and, on eligible tickets, park-to-park access. Disney's fall offer for eligible Disney+ members combines up to 25% off selected rooms with Park Hopper access on qualifying packages, which lowers the cost of a trip for one group without cutting published prices for everyone.

Universal's parks revenue turns down

Universal's parks revenue was up 24.2% in January through March, measured against a quarter before Epic opened. Growth slowed to 2.7% in April through June, the quarter of Epic's first anniversary, and adjusted EBITDA fell even as revenue rose. In July through September, with Epic open in both years, revenue fell 4.4%.

Exhibit 2. Universal parks revenue turned down. Comcast Theme Parks change vs a year earlier, quarters ended Sept. 30, 2025 to Sept. 30, 2026. Revenue: +18.7%, +21.9%, +24.2%, +2.7%, -4.4%. Adjusted EBITDA: +13.0%, +23.8%, +33.3%, -5.1%, -17.1%.

In July, management attributed softer attendance that began in June to consumer sentiment and travel costs, and said Epic was delivering the guest response it expected. In October, Cavanagh added two causes of Universal's own making: rivals adjusted their marketing faster, and Epic still has limits on ride capacity and throughput. Chief Financial Officer Jason Armstrong said the pressure was concentrated in Orlando and Japan.

Capacity limits complicate any commercial fix. Discounts can bring visitors in; they cannot increase the number a ride carries each hour. Comcast has not quantified the cost.

The September quarter shows how fast lower revenue squeezes earnings. Revenue fell $120 million and operating costs rose $40 million, cutting adjusted EBITDA by $160 million to $780 million and the margin to about 30.0% from 34.6%. Comcast cited increased promotions as one reason admissions revenue fell, but did not separate price, visitor mix and attendance.

Exhibit 3. Universal Theme Parks adjusted EBITDA fell from $940 million to $780 million in the quarter ended Sept. 30, 2026: minus $120 million from lower revenue and minus $40 million from higher costs. Margin 34.6% to 30.0%.

Cavanagh said results in the theme parks segment should strengthen through 2027, with a return to growth in the second half, and that Orlando attendance, spending and profit remain well above where they were two years ago.

Disney's guests kept spending more

Disney's domestic parks reported a 1% attendance decline and a 5% increase in spending per visitor in the quarter ended March 28. In the quarter ended June 27, attendance rose 3% and spending per visitor 4%. Disney credited summer promotions, domestic tourists and annual passholders for Walt Disney World's performance, so discounts and higher average spending went together.

Exhibit 4. Disney domestic parks, change vs a year earlier. Quarter ended Dec. 27, 2025: attendance +1%, spending per visitor +4%. Quarter ended Mar. 28, 2026: -1% and +5%. Quarter ended June 27, 2026: +3% and +4%, implying about +7%.

Spending per visitor is not a ticket-price measure. It includes food, drink and merchandise, and Disney's admissions line includes paid Lightning Lane access. Disney's hotels give a separate read: domestic occupancy reached 91% in the June quarter, up from 86%, and spending per occupied room rose 3%.

Two items flatter Disney's profit growth. A roughly $100 million tariff refund contributed about four percentage points of the Experiences segment's 20% operating-income increase in the June quarter; without it, growth was about 16%. And new cruise ships lift the domestic category: Disney attributed its July-September 2025 profit growth to the cruise line, not the parks.

Universal grew faster; Disney expanded its margin

Over the four quarters to late June, Universal's parks revenue grew 16.5% to $10.35 billion, against 7.8% to $26.8 billion for Disney's domestic parks and experiences business. Universal's adjusted EBITDA grew 15.1% and Disney's domestic operating income 12.1%. Universal's margin slipped to about 30.1% from 30.5%, while Disney's rose to about 26.4% from 25.4%. These are our calculations, summing the four quarters reported in each company's quarterly results and comparing them with the prior four.

Exhibit 5. Four quarters ended June 27, 2026 (Disney) and June 30, 2026 (Comcast). Universal Theme Parks revenue +16.5%, adjusted EBITDA +15.1%, margin 30.5% to 30.1%. Disney Domestic Parks and Experiences revenue +7.8%, operating income +12.1%, margin 25.4% to 26.4%.

The two profit measures differ: Disney's operating income is after depreciation and Universal's adjusted EBITDA is before it. Each company's trend is meaningful; the margin levels cannot be compared directly.

The wider market points the same way as Universal's account. Orlando International Airport's passenger traffic was down 6.9% in August from a year earlier, after a record 76.7 million visitors to the region in 2025. Airport traffic is not park attendance, but it is a reason not to assume Disney's spring strength carried into the summer.

What the Street is saying: Rosenblatt (Oct. 23, 2026), Bank of America (Sept. 29, 2026), Goldman Sachs (Oct. 4, 2026) and MoffettNathanson (Aug. 2025) on Orlando parks demand.
What we are watching: Disney fiscal fourth quarter, including a 53rd week, on Nov. 17; Orlando airport September traffic; TEA 2025 attendance estimates; Comcast fourth quarter and the new three-park passes in late January 2027; Comcast target for theme parks growth in the second half of 2027.

The next test

Disney reports its fiscal fourth quarter, July through September, on Nov. 17. It is the first period that overlaps Universal's soft summer. The quarter also has an extra week, because Disney's fiscal 2026 runs 53 weeks; its outlook calls for adjusted earnings per share to grow about 16% including that week and about 12% without it. Growth in the parks should be read with that week removed.

If domestic attendance and spending per visitor both fall, the case that Disney is winning the contest for the whole week is wrong. If growth comes mostly from cruises, it says little about the parks. At Universal, the test is whether the new passes and better ride capacity turn Epic's added capacity into more visits and higher earnings.

For a family that has already paid for tomorrow, the rival's most important price is the cost of changing plans.

Sources

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]]><![CDATA[Universal’s Slowdown Raises the Stakes for Disney]]>https://substack.mousemoney.co/p/universals-slowdown-raises-the-stakeshttps://substack.mousemoney.co/p/universals-slowdown-raises-the-stakesSat, 24 Oct 2026 14:10:24 GMT
Universal Theme Parks, quarter ended Sept. 30, 2026: revenue down 4.4% to $2.6 billion; adjusted EBITDA down 17.1% to $780 million vs. a year earlier.

Universal's newest theme park was supposed to give vacationers another reason to visit Orlando. Comcast's latest results show that adding attractions is only part of the challenge.

Revenue at Universal's theme-park business fell 4.4% in the quarter ended Sept. 30, while adjusted earnings before interest, taxes, depreciation and amortization dropped 17.1%. Lower admissions revenue, including the effect of increased promotions, met higher operating costs.

For Disney, those results raise a question rather than settle a contest: Can its parks keep growing as its largest Orlando rival struggles with softer demand and operational problems?

Disney's most recent results were stronger. But they cover an earlier period, and its Experiences business includes cruises and consumer products as well as parks. Declaring a winner now would get ahead of the evidence.

A New Park, Familiar Constraints

Comcast executives identified two problems beyond broader economic and geopolitical pressures. Competitors responded more quickly to weakening demand, and Epic Universe continued to face constraints on ride capacity and the number of guests attractions can accommodate.

Management expects Orlando's softness to persist through at least the first half of 2027. It is responding with promotional packages and work to improve attraction reliability and loading times.

There is a counterpoint: Executives said Orlando attendance, guest spending and overall financial performance remained materially above their levels two years earlier. The current decline follows a substantial expansion of the business.

That distinction matters. A difficult comparison after a new park opens does not establish that the investment has failed. It does expose the demands of operating a larger resort: attracting enough additional visitors, getting them onto rides and generating enough revenue to cover the added expense.

Building capacity and earning an adequate return on it are separate achievements.

What Disney's Results Actually Show

Disney reported a 3% increase in domestic park attendance in its quarter ended June 27. The company credited attendance growth among domestic tourists and annual passholders at Walt Disney World, alongside summer promotions and new experiences.

Those results complicate a simple narrative in which Universal needs discounts while Disney relies on brand loyalty. Disney uses promotions, too. The relevant question is whether those offers generate enough additional business to justify their cost.

Nor did Universal's difficulties begin only in the September quarter. In the preceding quarter, its theme-park revenue increased 2.7%, but adjusted EBITDA fell 5.1% as expenses grew faster than revenue. Epic Universe was contributing to Orlando's sales growth while the broader parks business faced pressure on earnings.

That makes the comparison with Disney worth watching. It still does not establish that Disney captured visitors who otherwise would have gone to Universal.

The two companies report different businesses using different profit measures. Disney's cruise expansion also adds a source of growth that Universal's parks segment does not share. A chart comparing their segment earnings should make those differences explicit.

Exhibit 1. Disney Experiences and Universal Theme Parks earnings growth by calendar quarter. Disney Experiences operating income: +6% Oct.-Dec. 2025, +5% Jan.-Mar. 2026, +20% Apr.-Jun. 2026, due Nov. 17 for Jul.-Sep. Universal Theme Parks adjusted EBITDA: +24%, +33%, -5%, -17%. Profit measures differ.

Why the Rest of Comcast Matters

Parks were one part of an uneven quarter for Comcast.

Peacock generated $261 million in adjusted EBITDA, compared with a $217 million loss a year earlier. That $478 million improvement exceeded the company's $68 million increase in consolidated pro forma adjusted EBITDA.

Exhibit 2. Peacock adjusted EBITDA by quarter in $ millions: -372 (Q4 2024), -215, -101, -217, -552, -432, then +189 (Q2 2026) and +261 (Q3 2026).

Subtracting Peacock's improvement implies that the remainder of Comcast, including corporate costs and consolidation adjustments, deteriorated by about $410 million on that basis. The calculation illustrates Peacock's growing contribution; it is not a separately reported company measure.

Exhibit 3. Change in Comcast pro forma adjusted EBITDA vs. Q3 2025: Peacock +$478M, everything else -$410M, Comcast total +$68M.

The result also cautions against treating a diversified entertainment company as a single business moving in one direction. Streaming can improve while parks weaken. A successful film slate can coexist with pressure elsewhere.

For Disney, the attraction of owning franchises is the ability to earn revenue from the same characters across films, streaming, merchandise and vacations. That creates opportunities to spread investment across several businesses. It does not remove the need for each new film, attraction or ship to earn a return.

The same discipline applies to efforts to connect those businesses more closely. Cross-promotion is valuable when it changes customer behavior profitably. A discount on a vacation a family would have booked anyway is a different proposition from winning an additional trip.

The Next Test

Disney's next report, on Nov. 17, will provide a more current view of demand and help narrow the timing gap with Comcast's results.

Investors should distinguish growth from new capacity, growth from existing operations and any benefit from fiscal 2026's extra week. Disney's outlook calls for approximately 16% adjusted earnings-per-share growth including that week, compared with approximately 12% excluding it.

Exhibit 4. Disney fiscal 2026: segment operating income up 21% in the June quarter vs. 5% for nine months; free cash flow up 63% vs. down 24%. Adjusted EPS growth guidance about 16%, about 12% excluding the 53rd week.

For parks, attendance alone will not answer every question. Higher visitor numbers can coexist with heavier promotions or rising costs. Revenue and earnings need to show what the additional business is worth.

Universal's slowdown demonstrates how quickly the economics can become harder when demand weakens and operating expenses rise. Disney's earlier results offer reasons for confidence, but they cannot establish how its parks performed through the same summer.

The question is how much profitable demand either company can create for the capacity it has built.

What the Street is saying: Rosenblatt (Oct. 23, 2026) ties Universal weakness to Orlando softness and the Epic Universe comparison; Bank of America (June 2026) expected modestly improving Disney attendance; Barclays (July 2024) said Universal weakness may not carry over to Disney; MoffettNathanson (2024) expected Epic to cost Disney World about 1 million visits.
What we are watching: late October, Oriental Land first-half results; Nov. 17, Disney fiscal Q4; late January, Comcast fourth quarter; spring 2027, Disney+ membership details; second half of 2027, Universal return to growth and NBCUniversal spin-off.

Sources

]]><![CDATA[Disney and the NFL’s Business Ties Go Far Beyond a $40 T-Shirt]]>https://substack.mousemoney.co/p/disney-and-the-nfls-business-tieshttps://substack.mousemoney.co/p/disney-and-the-nfls-business-tiesMon, 19 Oct 2026 17:26:47 GMTAn Arizona Cardinals T-shirt has an unexpected new bird.

Iago, the red parrot from Disney's Aladdin, appears alongside the villain Jafar against a backdrop of Cardinals lettering. The design is part of a new merchandise collection pairing NFL teams with characters from Disney, Pixar, Marvel and Star Wars. Fanatics lists the shirt at a regular price of $39.99.

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A model wearing the red Arizona Cardinals Disney x Champion T-shirt showing Jafar and Iago against Cardinals lettering.
The Jafar and Iago Arizona Cardinals T-shirt. Photo: Fanatics

The novelty apparel is one piece of a much larger business relationship between Disney and the NFL, encompassing merchandise licensing, television rights, streaming and an ownership stake in ESPN.

In January, the NFL acquired 10% of ESPN in exchange for media assets in a transaction Disney valued at approximately $3 billion. ESPN is preparing to produce its first Super Bowl in February 2027, with the game airing on ABC, ESPN and Disney+. Meanwhile, Disney is bringing its characters into football through merchandise, animated broadcasts and a yearlong promotional campaign.

The arrangements give the companies more ways to reach consumers and generate revenue from audiences they already share. How much additional business they produce remains largely undisclosed.

The Business Behind a Disney Football Shirt

The Disney-Champion NFL collection debuted July 16 at Fanatics Fest in New York, where NFL Commissioner Roger Goodell and broadcaster Taylor Rooks hosted a staged character draft. The first eight team-character pairings were revealed there, with the remaining 24 announced Aug. 24.

Some selections draw on the teams' identities. The Dallas Cowboys get Woody from Toy Story, the New England Patriots get Captain America and the Las Vegas Raiders get Darth Vader.

Others require more specialized football knowledge. The Washington Commanders were paired with Hamm, the Toy Story piggy bank, a reference to the Washington franchise's celebrated 1980s offensive line, known as the Hogs.

Bret Healey, director of graphic design at Disney Consumer Products, told the entertainment website Laughing Place that the idea grew out of seeing visitors wear their hometown teams' apparel at Disney parks.

Disney characters have appeared on NFL clothing before. In 2021, a licensee called Junk Food Clothing approached the league about a line combining team logos with Mickey Mouse, Marvel and Star Wars imagery.

The latest collection is broader, with pairings for all 32 teams, and ESPN is promoting it as part of its buildup to the 2027 Super Bowl.

Several companies have a financial interest in the clothing.

Disney owns the characters, while the NFL controls the licensing of its team identities. The apparel carries the Champion label, which Authentic Brands Group acquired in 2024. Champion's U.S. teamwear business is managed by Ames Watson, which also has an investment relationship with Lids. Fanatics, another major retail partner, identifies itself as Lids' majority owner.

Licensed merchandise typically generates royalties for the owners of the intellectual property involved. But the companies haven't publicly disclosed the royalty rates, revenue shares or minimum guarantees for this collection.

That makes the $39.99 regular retail price a poor guide to what Disney receives, how much goes to the NFL or what remains for the companies making and selling the clothes.

Disney's broader licensing business illustrates the potential scale. In fiscal 2025, the company reported $3.879 billion in merchandise-licensing revenue.

Separately, the trade publication License Global estimated in its 2026 rankings that Disney-licensed products generated $63 billion in worldwide retail sales during 2025, more than those of any other company it tracks.

The measures aren't interchangeable. Disney's reported figure represents revenue it recognized. The industry estimate measures consumer spending on licensed products, much of which goes to manufacturers and retailers.

Disney also participates in retail sales directly. It sells the NFL collection through DisneyStore.com, while Good Morning America, part of Disney-owned ABC News, published shopping coverage featuring links to the clothing. A disclosure accompanying that coverage says ABC receives commissions on purchases made through those links.

The NFL has another financial connection to the retail business. In 2022, it invested $320 million in Fanatics as part of a $1.5 billion financing round. That investment gave the league an equity interest in Fanatics, separate from its role as a merchandise licensor.

It doesn't establish that the league receives any additional payment on an individual shirt sale.

The result is a network of commercial relationships surrounding a single product. What remains unavailable is a breakdown of how much each participant earns.

Table of five Disney-NFL arrangements and how much of each one’s money is public: media rights (about $2.7 billion a year, reported), the NFL media-assets transaction ($3 billion fair value, disclosed), and character apparel, animated telecasts and the Year of the Super Bowl (not disclosed).

The Much Bigger ESPN Deal

The more consequential financial connection between Disney and the NFL was completed Jan. 31.

ESPN acquired NFL Network, the pay-TV distribution rights to NFL RedZone and the league's fantasy football business. The NFL retained ownership and production of RedZone, along with its digital-distribution rights.

In exchange, the league received a 10% noncontrolling interest in ESPN. Disney now holds an effective 72% stake in the sports network, Hearst owns 18% and the NFL owns 10%.

Bar showing ESPN ownership after January 31, 2026: Disney 72%, Hearst 18%, NFL 10%, with notes on what each side exchanged, the $3 billion fair-value estimate and the post-2034 options.

Disney valued the noncash transaction at approximately $3 billion, according to its securities filing.

The ownership arrangement need not be permanent. After July 2034, depending on the performance of the acquired assets, Disney may gain the right to repurchase the NFL's stake at 70% of its then-current fair market value, using a 10-year note. Alternatively, the NFL may gain the right to acquire up to an additional 4% of ESPN at a similar discount.

The acquired assets haven't materially affected Disney's consolidated results. The company said their contribution to revenue and net income wasn't material for the quarter and nine months ended June 27, 2026.

Disney's financial relationship with the NFL extends well beyond the assets it acquired in January.

ESPN's television-rights agreement with the league was negotiated in 2021, years before the NFL became an ESPN shareholder. The agreement extended Monday Night Football rights through the 2033 season and awarded ESPN and ABC two Super Bowls.

CNBC reported at the time, citing people familiar with the negotiations, that Disney would pay approximately $2.7 billion annually. The companies haven't publicly confirmed the figure.

The first Super Bowl under that agreement is scheduled for Feb. 14, 2027, at SoFi Stadium in Inglewood, Calif.

Disney has since expanded its distribution plans. On Oct. 7, ESPN announced that all U.S. Disney+ subscribers would be able to stream the game, with the service also carrying it in more than 55 international markets.

Advertising demand has been strong. Disney said in August that it had sold out its commercial inventory for the game, with 58 brands securing advertising time across 34 categories.

The Super Bowl is also the centerpiece of a 12-month marketing campaign spanning Disney's entertainment businesses. One advertisement reworks the company's familiar “I'm going to Disney World!” Super Bowl tradition with more than 60 Disney characters. The NFL apparel collection is another part of that promotional effort.

The connections are commercial, but they shouldn't be confused with the terms of the January media transaction.

Disney and ESPN secured the 2027 Super Bowl rights years before the NFL received its ownership stake. Neither company has publicly established that the apparel agreement was negotiated as part of the January deal.

What has changed is the financial relationship: The NFL now owns part of ESPN, the network that broadcasts Monday Night Football and will televise the 2027 Super Bowl.

Timeline of Disney and NFL deals, programs and scheduled events, March 2021 to February 2027, from the 2021 TV deal that gave ESPN and ABC two Super Bowls to Super Bowl LXI on February 14, 2027.

Can Disney Bring New Viewers to Football?

The collaboration also extends to animated broadcasts intended to reach audiences beyond conventional sports television.

In October 2023, ESPN and Disney transformed a live Atlanta Falcons-Jacksonville Jaguars game into Toy Story Funday Football. A December 2024 broadcast put the Cincinnati Bengals and Dallas Cowboys into the world of The Simpsons. In December 2025, the Philadelphia Eagles and Los Angeles Chargers played inside an animated version of the factory from Pixar's Monsters, Inc.

The broadcasts use player-tracking data from Sony's Hawk-Eye system and animation technology from Beyond Sports to recreate the action in real time.

ESPN has been explicit about its ambitions. Before the Simpsons broadcast, Rosalyn Durant, an ESPN executive vice president who oversees league programming, described audience expansion as a top priority for the network.

The format gives viewers another way to experience football, potentially attracting people more familiar with Disney characters than NFL players. It also provides Disney's streaming services with programming built around franchises the company already owns.

But drawing someone to an animated broadcast doesn't necessarily make that person a regular football viewer. The companies haven't released sufficiently detailed data to establish how many occasional viewers subsequently became regular NFL viewers.

The merchandise presents a related question, although its immediate commercial purpose is simpler.

A Simba shirt bought by a longtime Detroit Lions supporter generates retail sales and potential licensing revenue. The same shirt bought by a Disney fan who doesn't follow football could introduce the NFL to a new customer.

Both purchases can be commercially valuable. Neither requires the buyer to become a regular football viewer for the sale to generate revenue.

Beyond the Merchandise

The financial scale of the Disney-NFL relationship is clearest in television rights, licensing and ESPN ownership. The economics of individual merchandise and promotional collaborations are considerably less transparent.

That distinction matters. A merchandise sale doesn't necessarily demonstrate growth in the NFL's audience, just as viewership of a special animated broadcast doesn't establish a lasting increase in football fandom.

What the arrangements do demonstrate is how Disney and the NFL can use familiar assets across multiple businesses.

Disney characters appear on football merchandise, in television promotions and in animated broadcasts. NFL games reach viewers through ESPN, ABC and Disney+, while licensed clothing is sold through Fanatics, the league's retail channels and Disney's own stores.

The Jafar shirt is an unlikely symbol of that relationship. What looks like an amusing pairing of a cartoon villain and a football team reflects a broader effort to generate business from audiences the companies already command.

Neither Disney nor the NFL needs to create a new football fan with every collaboration to benefit commercially. They can also seek additional spending and engagement from existing customers.

Whether these arrangements produce substantial additional profits remains unknown. What is clear is that Disney and the NFL have created more opportunities to generate revenue from audiences they already share.

Sources

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]]><![CDATA[Disney Raised the Annual Pass Again. Has It Gone Too Far?]]>https://substack.mousemoney.co/p/disney-raised-the-annual-pass-againhttps://substack.mousemoney.co/p/disney-raised-the-annual-pass-againFri, 16 Oct 2026 13:46:33 GMTI have gone to Disney World almost every year since 1982, the year Disney started selling an annual pass there. The Annual World Passport cost $100 for an adult and covered a year of admission to two parks, Magic Kingdom and EPCOT, which was about to open. Disney's 1982 employee bulletin

Today the Incredi-Pass, the only Disney World annual pass sold to the general public without Florida residency or a Disney Vacation Club membership, costs $1,749 before tax. It has no blockout dates, though visits are still subject to Disney's pass terms, including park reservations where required. Disney's current pass prices

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Adjusted for inflation ($100 in 1982 is worth about $342 today), that is roughly five times the original price, although today's pass covers four parks rather than two and operates under different rules. CPI-U

At its year-end 2025 price of $1,629, one pass cost about 1.86% of median U.S. household income, compared with 0.60% in 1984. Pass price history, Census income data

Disney has raised the price of belonging much faster than inflation, and it has also taken more control over when that belonging gets you in.

The latest increase, and a former CEO's account

In October, Disney raised the Incredi-Pass by $120, from $1,629 to $1,749. That is the largest dollar increase since the pass launched in 2021. At 7.4%, it is smaller in percentage terms than the 7.7% increase in 2022. 2026 increase

On September 29, Bob Chapek published Behind the Castle Walls, a memoir that includes his account of annual-pass pricing during his time as CEO. Publisher

According to BlogMickey's coverage of the book, Chapek writes that Michael Colglazier and Josh D'Amaro, who was then running Walt Disney World and is now Disney's CEO, studied the annual-pass business with him and recommended changes to shift demand and spread out crowds. They told him, he writes, that the pass was a fantastic deal for passholders and a terrible one for Disney. In BlogMickey's telling, Chapek describes D'Amaro as a "key ally" and as the "tip of my spear" in rolling out park reservations. BlogMickey on the memoir

Chapek's account, as reported by BlogMickey, describes D'Amaro's involvement but does not establish responsibility for individual price increases.

The leadership record is simpler:

  • May 2020: D'Amaro becomes parks chairman, reporting to Chapek.

  • November 2022: Disney announces a pass increase on November 15, while Chapek is CEO. Robert Iger returns as CEO on November 20, before it takes effect.

  • 2023 to 2025: Further increases follow under Iger, with D'Amaro still running the parks.

  • March 18, 2026: D'Amaro becomes CEO, and Thomas Mazloum succeeds him as parks chairman.

2020 appointment, 2022 announcement, Iger's return, 2026 succession, Mazloum appointment

D'Amaro ran the parks business through every pass increase from May 2020 until he became CEO, under two chief executives.

Chart: after inflation, Disney's top annual pass costs five times its 1982 price; pass price from $100 in 1982 to $1,749 in October 2026, with CEO terms

What the pass does for Disney

An annual pass commits the customer to a year of admission and gives the holder a reason to return. For Disney, that means cash committed early and more chances to sell food, merchandise and tickets for friends. On a slow Tuesday, a passholder fills space that would otherwise sit empty.

On a packed Saturday, the math flips. A park has only so many ride seats, restaurant tables and places to stand. A passholder who comes that day pays nothing more to get in. A guest buying a one-day ticket does.

Disney’s recent changes give it tools to manage that tension. When Disney resumed new pass sales in 2023, it said quantities would be limited and a pass type could sell out, even as it eased some reservation rules. Disney's announcement Tiers, blockout calendars, reservations and sales caps give the company several levers at once: it can earn more from each passholder, keep passholders away on the busiest days and steer some guests toward dated tickets. Disney doesn't publish the customer-level figures, such as visit frequency, in-park spending and hotel stays, that would show which lever matters most or whether passholders are more or less profitable than other guests.

Cheaper passes, different terms

Florida residents can buy the Pixie Dust Pass for $499. Measured against the $100 pass of 1982, that is only about 46% more after inflation. The catch is the calendar: it is good on eligible weekdays, with peak and holiday blockouts. Disney's Florida resident passes

A working parent who can mostly go on weekends faces a different choice from a retiree who can go on a Tuesday. Both may live in Florida, but the cheaper pass means something very different to each of them.

Disneyland follows the same pattern. Its Magic Key runs from $599 for the Imagine Key, sold only to Southern California residents, to $1,899 for the Inspire Key, and even the top tier has blockout dates and requires reservations. Disneyland's Magic Key comparison

The annual pass has always been more than a ticket. Disney now prices it more precisely, by who you are and when you want to come.

How the price compares

I compared the pass with 15 government price indexes for household costs, from September 1982 to August 2026. Over that period the pass rose from $100 to $1,629, more than sixteenfold, before October's increase. None of the 15 indexes rose as fast. The closest were hospital services, up about thirteenfold, and tuition, school fees and childcare, up almost tenfold. Rent rose less than fivefold. Hospital services, tuition and childcare, rent

Those are price indexes, not spending. A slower increase in a necessity can strain a family budget far more than a faster one in a vacation.

For a price you can picture: in September 1986, a U.S. Big Mac cost $1.60 and the pass cost $155, about 97 Big Macs. By July 2026, the burger cost $6.22 and the pass cost $1,629, or 262 Big Macs. After inflation, the Big Mac rose 28% and the pass rose 247%. The Economist's Big Mac data, pass price history

Chart: a Disney World annual pass cost 97 Big Macs in 1986 and 262 in July 2026

The math of belonging

Disney's strongest defense is everything it has built. The 1982 pass covered two theme parks, and today's covers four, along with entire new lands and attractions. Value and affordability are different questions, though. A family pays for a bigger bundle with cash, not with an estimate of how much better the bundle is.

For a frequent visitor, the pass still works. At $1,749, admission works out to about $175 a visit for someone who goes ten times and about $35 for someone who goes fifty, before travel, food or anything else. The effective price falls with every visit, which is why the pass rewards the people who come most.

So, has Disney gone too far?

On price, the record is clear. The pass has risen faster than inflation, faster than every household price index I checked and faster than median household income.

Whether that is too far depends on who is asking. For a customer, the question is affordability, and the pass now takes about three times the share of a median household's income that it did in 1984. For Disney, the question is commercial: whether higher prices and tighter access bring in more revenue and more manageable crowds than a cheaper, busier pass would. A pass can fail the first test and still pass the second.

Outsiders can't see where Disney's commercial limit is. Disney doesn't publish how many passes it sells, how often holders visit or how many renew, so neither continued sales nor a sold-out tier would settle whether the price is right for Disney, let alone for its customers.

That is the business of the annual pass. It makes coming back cheap once you've paid to belong. Over four decades, Disney has raised the price of belonging far faster than inflation and gained more control over when belonging gets you in. A customer can reasonably decide that is too far, even if Disney keeps selling every pass it offers.

Methodology: Inflation figures use monthly, unadjusted CPI-U for the U.S. city average. August 2026 is the latest CPI reading used, so comparisons with October 2026 pass prices carry a two-month lag. Comparisons with household price indexes run from September 1982 to August 2026, comparing the $100 pass of September 1982 with the $1,629 price in effect in August 2026. Income shares use year-end pass prices and median U.S. household income: $135 against $22,420 in 1984, and $1,629 against $87,460 in 2025. The Big Mac comparison runs from September 1986 to July 2026. Prices exclude tax and optional add-ons, and no dollar value is assigned to changes in attractions or benefits. Memoir material is attributed to BlogMickey's published coverage.

Mouse Money is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

]]><![CDATA[The Push and the Pull: Who Paid for Disney+?]]>https://substack.mousemoney.co/p/the-push-and-the-pull-who-paid-forhttps://substack.mousemoney.co/p/the-push-and-the-pull-who-paid-forTue, 13 Oct 2026 12:04:26 GMTI thought Disney was a parks company

I have been going to Walt Disney World almost every year since 1982. For most of my childhood, Disney was a place: the castle, the monorail, the walk down Main Street. If you had asked me what business Disney was in, I would have said theme parks.

That changed in my first strategy course at Wharton, where Disney showed up again and again in the case studies. One was about governance. Michael Eisner’s board included Reveta Bowers, head of the school his sons attended, and Father Leo O’Donovan, the Jesuit president of Georgetown. BusinessWeek named it the worst board in America in 1997.

Another was about the companies that tried to copy Disney. The clearest example came later, in China. Wang Jianlin, then China’s richest man, promised his Wanda theme parks would surround Shanghai Disneyland like “a pack of wolves.” A year after Shanghai opened, Wanda sold 91% of its 13 tourism projects to Sunac and 77 hotels to R&F. Debt and regulators drove that sale. My read is that Wanda also ran into what Disney already knew: the rides are the easy part to build. The reason to come back is the stories.

The little green army men

The example I remember from class is the green army men from Toy Story, the plastic soldiers who run recon with a baby monitor. They are on screen for minutes, and they still march through Toy Story Land at Hollywood Studios. But they were never Disney’s. They are a 1930s toy anyone can make, and Toy Story revived a whole shelf of toys Disney did not own: sales of Mr. Potato Head and Etch A Sketch soared.

What Disney did own paid off. Merchandise from the first two Toy Story films reached $4 billion in retail sales by 2010. For fiscal 2010, Disney projected $2.4 billion of Toy Story merchandise sales at retail, and analysts estimated that could bring Disney more than $200 million in licensing revenue. That is the loop in Disney’s 1957 synergy map: films at the center, feeding television, Disneyland, music, books and merchandise. At Disney, one side has never worked without the other.

Disney's 1957 synergy map

Disney’s 1957 synergy map. © Walt Disney Productions.

The question

Disney’s streaming business now earns an operating profit. But that milestone answers only one question. The larger one is how Disney divides its cash among recovering from the streaming build, expanding Experiences, rewarding shareholders and reducing debt, and how much room is left if the parks slow down.

Four CEOs and the deals they left behind

Disney’s last four CEOs came from two sides of the house. Eisner and Iger came up through television and film. Chapek and D’Amaro came up through consumer products and the parks.

Disney CEOs, signature moves and borrowings

The résumés are a useful lens, but they do not explain the balance sheet on their own. The dates in the table are fiscal year ends near each handover, except D’Amaro’s, which is the latest quarter. Borrowings peaked at $58.6B in FY2020, Chapek’s first year, as Disney borrowed through the pandemic, then fell to $48.4B by FY2022. They fell again during Iger’s return and rose this year. The clearer pattern is in how the big content deals were paid for, and what each successor inherited.

How Disney paid for Pixar, Marvel, Lucasfilm, Fox and Hulu: cash versus stock

Source: Disney 10-K filings and deal announcements; cash paid to sellers at closing.

Pixar, Marvel and Lucasfilm, which built much of the Disney+ library, cost about $4.6B in cash combined; Disney paid the rest in its own stock, so the sellers shared the risk. Fox and Comcast’s Hulu stake cost about $45B in cash paid to sellers, and Disney also assumed roughly $19B of Fox debt. Those obligations outlasted the CEO who made the deals.

Where the cash went

Disney borrowed to buy Fox, and its debt has not come back down to where it was.

Disney borrowings and cash, FY2000 to FY2025

Source: Disney annual reports and Forms 10-K, FY2000 to FY2025; borrowings = current plus long-term.

Disney won Fox at a headline $71.3B after a bidding war with Comcast; its own accounts value the deal at $69.5B, $35.7B in cash and $33.8B in stock. It borrowed $31.1B in bridge loans for the cash, repaid $16.1B of that the next day with cash it acquired, and assumed about $19.2B of Fox’s debt. Borrowings went from $20.9B to $47.0B in a year, then to $58.6B as Disney borrowed through the pandemic. Buying out Comcast’s share of Hulu cost about $9.0B more in FY2024 and FY2025. Interest expense, $682M in FY2018, has run between $1.2B and $2.1B a year since. Fox also brought far more than streaming: studios, FX, National Geographic and, until it was written down and folded into a joint venture, Star India.

So who paid for the streaming build? Segment results show which businesses earned money, not which dollars funded which project, so “the parks paid for streaming” is shorthand. Here is what the segment results do show.

Streaming operating income versus Experiences, FY2020 to FY2025

Source: Disney Forms 10-K, FY2020 to FY2025; Direct-to-Consumer and Experiences segment operating income.

Streaming lost about $11B from FY2020 through FY2023. Two businesses earned the profits that carried the company through it. In FY2020, with the parks closed, the Experiences segment lost $81M and the TV networks, including ESPN, earned $9.0B. As the parks reopened, Experiences became the larger engine. In FY2025 it earned $10.0B, 57% of Disney’s segment operating income, while the entertainment networks earned $3.0B and are shrinking.

The budget shows where Disney now expects its returns. In FY2022, it initially budgeted up to $33B of content spending, nearly seven dollars for every dollar of capital spending. This year it is guiding to $24B of content and about $9B of company-wide capex.

Content spending versus capital spending, FY2022 to FY2026

Source: Disney earnings calls and Forms 10-K; content spend includes sports rights; capex is company-wide, mostly parks and cruise.

Last fiscal year, operating cash covered capex, buybacks and dividends: $18.1B from operations paid for $8.0B of capital spending, $3.5B of buybacks and $1.8B of dividends, and borrowings fell. This fiscal year looks different. Disney raised its buyback target to at least $9B.

FY2026 nine-month cash bridge

Source: Disney Form 10-Q for the quarter ended June 27, 2026.

In the first nine months of FY2026, Disney generated $12.5B from operations and spent $6.8B on capital projects, leaving $5.7B. It spent $7.2B on buybacks. It also sold $4B of bonds in February, its first since 2020, and borrowings rose from $42.0B to $46.0B. Two qualifiers: this year’s operating cash included paying taxes Disney had deferred, and management tied the larger buyback partly to cash once set aside for its OpenAI deal and to expected proceeds from the A+E sale. Disney does tie some cruise-ship financing directly to debt: its FY2025 report shows $1.1B borrowed for each of Disney Treasure and Disney Destiny, export-credit loans repaid over 12 years.

What streaming earns, and where it comes from

Disney+ and Hulu reported 131.6M and 64.1M paid subscriptions at the end of FY2025. Those are counts of subscriptions to each service, not unique households.

Streaming services, latest year

The measures differ, so treat this as context, not a ranking. Netflix is a pure streamer; the others carry studios, networks and, in Disney’s case, parks on the same balance sheet.

What people watch is a separate question from what wins or keeps subscribers.

Nielsen streaming minutes by title

Source: Nielsen streaming charts via The Hollywood Reporter, Variety and TheWrap; 2021 to 2025.

The Mandalorian was a genuine hit: in the week of December 14, 2020, its 16 episodes drew 1.3 billion minutes, making it the first show outside Netflix to top Nielsen’s weekly streaming chart. But the most-watched title on Disney’s services is Bluey, which Disney licenses from BBC Studios. Minutes favor long catalogs, so the viewing chart above shows what fills the hours, not which shows earned their budgets. Quarterly subscriber additions cannot isolate a title either: a show can reduce cancellations without producing a visible spike.

Bluey is still the clearest case of licensed IP feeding the flywheel. After it became the top show on US streaming, Disney brought it into Animal Kingdom, Disneyland and its cruises. Disney licenses Bluey from BBC Studios rather than owning the franchise; Ludo Studio produces the show, and Disney’s role in the coming film is theatrical distribution.

Estimated annualized revenue across Disney+ and Hulu rose from about $11.7B in the fiscal fourth quarter of 2021 to $21.4B four years later. This is a run rate, not reported annual revenue: quarter-end paid subscriptions times that quarter’s monthly revenue per subscription, which includes advertising, times 12. It covers three reported series: Disney+ domestic (US and Canada), Disney+ international excluding Hotstar, and Hulu SVOD. Valuing the added subscriptions at 2021 revenue per subscription, they account for 74% of the increase; valuing them at the 2025 rate, 86%. Either way, most of the growth came from volume. The rest came from higher revenue per subscription, mostly outside the US; Hulu’s fell. Disney allocates bundle revenue across the services, so the split also depends on its allocation.

Streaming revenue run-rate bridge, FY2021 to FY2025

Source: Disney quarterly earnings releases; year-end subscriptions times fourth-quarter monthly revenue per subscription, times 12.

Many of those subscriptions came in through cheaper channels: the ad tier, bundles, and wholesale deals like Charter’s.

Disney+ list price versus revenue per subscription

Source: Disney quarterly earnings releases and published US price changes; revenue per subscription includes advertising.

Reported revenue per subscription includes advertising and bundle allocations, so it is not the same as what a household pays. But the gap is the point: from September 2021 to September 2025, the US ad-free price doubled, from $7.99 to $15.99, while reported revenue per domestic Disney+ subscription rose 19%, from $6.81 to $8.09. Disney stopped reporting both subscriptions and revenue per subscription after September 2025.

Earning it back, and the balance

In accounting terms, streaming already covers its programming, marketing and technology costs. What it has not done is recover the operating losses it took to get here. Nobody publishes a date, so I built a simple estimate, shown as cumulative operating-profit recovery rather than a cash return on Fox or Hulu.

Disney reports streaming on two bases. The Direct-to-Consumer line includes its virtual pay-TV services, Hulu Live TV and now Fubo. Since the first quarter of FY2026, Disney has also published a narrower SVOD income statement that excludes them, and that is the basis of its margin guidance, so the forecast below is built on it. In the first three quarters of FY2026, SVOD revenue was $16.4B and operating income $1.74B, a 10.7% margin. For all of FY2025, Disney’s supplemental SVOD statement shows $19.7B of revenue and $1.30B of operating income, a 6.6% margin. The one estimate is FY2026’s fourth quarter, which I put at about $5.6B of revenue and a 9% margin, reflecting the softer advertising Disney flagged. Management first guided to a 10% SVOD margin for this year and in August said double-digit, excluding the 53rd week; I keep 10% as the conservative case.

The losses being recovered sit on older bases. FY2020 to FY2022 include ESPN+, and every year includes Hulu Live TV; Disney has not restated them on an SVOD basis. In FY2025 the gap between the two lines was just $25M of operating income, so the virtual pay-TV business ran near breakeven and moves the totals little. ESPN+ makes the $11.0B somewhat higher than the SVOD services’ own losses, so the dates below lean conservative.

Recovery model assumptions
Cumulative streaming operating-profit recovery

Source: Mouse Money estimate from Disney’s SVOD supplemental disclosures (Q1 to Q3 FY2026) and segment results; 15% margin path from S&P Global Ratings (Dec 2024).

In the recovery chart, the dashed line is streaming’s operating losses from FY2020 to FY2023, $11.0B. On S&P’s path, cumulative profit since FY2024 reaches $10.2B in FY2028 and $14.1B in FY2029. At a flat 10%, it reaches $11.1B in FY2029, only just, so any shortfall pushes recovery to FY2030. The data appendix below adds an illustrative case that also charges streaming with Disney’s extra interest since FY2018.

Whether Disney has the balance right comes down to three tests:

  1. Streaming margins keep climbing. The third quarter reached 12.9%, helped in part by the timing of marketing and programming spend. S&P expects 15% by FY2028. If margins stall near 10%, recovery slips toward FY2030 and the rest of Disney carries more of the balance sheet for longer.

  2. Experiences spending adds guests, not just price. In FY2025, US park attendance fell 1% while per-guest spending on tickets, food, drinks and merchandise rose 5%. The $60B plan has to add rides, rooms and ships that bring more people in.

  3. The balance sheet keeps its A. When S&P raised Disney to A in December 2024, it said it expects S&P-adjusted leverage to stay below 2.5 times, the threshold it set for the upgrade. S&P’s adjusted measure includes more than borrowings, and I have not recalculated it. What is visible is the direction: this year buybacks ran ahead of the cash left after capex, and borrowings rose $4B.

Two views of what comes next

Wells Fargo’s Steven Cahall, who rates the stock Overweight, argued in July that Disney should go back to making content and license it to other streamers: “We think it could add ~40% to the stock price.” Goldman’s Michael Ng takes a different view, calling Disney “a multi-year earnings compounder” early in “a broader product and Experiences investment cycle.”

Management sides with Ng. Disney+ is to become “the digital centerpiece of our company,” D’Amaro told shareholders in March, while the parks run on “the largest capital investment plan in Disney Experiences’ history.” Nelson Peltz’s firm, Trian, argued in January 2023 that Disney was “overearning in the Parks business to subsidize streaming losses.” Peltz lost his 2024 proxy fight, but his question is still the right one to ask.

The cash to watch

Streaming now earns a profit. Whether that settles the question depends on how Disney splits its cash. When it reports in November, watch three figures for next year: buybacks, capital spending on the parks plan, and debt repayment. If buybacks keep running ahead of free cash flow while the parks plan accelerates, the room for a slowdown at the parks gets smaller.

Data appendix

Disney interest expense FY2018 to FY2025

FY2019 to FY2025 totals $11.8B, about $7.1B above seven years at the FY2018 level. Adding that $7.1B to streaming’s $11.0B of losses raises the bar to $18.1B: on S&P’s margin path it is reached in FY2030, and at a flat 10% not before FY2032. Treat that only as an illustration, because the extra interest also reflects Fox’s other businesses, pandemic borrowing and higher rates.

Borrowings, cash and cash flow FY2018 to FY2025
Entertainment SVOD by quarter
Cumulative streaming operating income since FY2024

Sources

]]><![CDATA[The Price of Skipping the Line]]>https://substack.mousemoney.co/p/the-price-of-skipping-the-linehttps://substack.mousemoney.co/p/the-price-of-skipping-the-lineSun, 11 Oct 2026 19:10:22 GMTI have watched Disney’s every move since I was a little girl.

When I was born, my grandfather gave me Disney stock. It was meant to pay for my education. As Disney grew, so did that stock, and over twenty years it helped fund my education, including an MBA from Wharton.

My nephew’s first trip to Disney and one of my favorites.

When I think about Disney, I think about it the way many of you do: it lets us dream big, make wishes, and find hope. For some people that comes through the characters, the castles, or the small dancing dolls. For me, it also comes through the company itself.

That stock paid for one of the greatest gifts of my life. It gave me the chance to make the dreams I had for my own life come true.

Today I am a venture capitalist. But Disney was the first business I ever followed.

My family went to the parks almost every year, and I started reading Disney’s annual reports when I was very young. Admittedly, at five, “reading” meant looking at the pictures. Over time I started looking at the charts. Then, once I really understood finance, I realized Disney had some of the greatest lessons in business to teach.

That is what Mouse Money is about.

I am starting with Lightning Lane Premier Pass, Disney’s top-tier way to skip the lines, because it shows Disney charging a substantial premium for flexibility inside an experience guests have already paid for. It is a lesson in willingness to pay, and in the limits of what public numbers can tell us.

Willingness to pay

One of the first concepts you learn in an MBA strategy class is willingness to pay: the most a customer will spend for a particular benefit.

Here is the subtle part. When someone buys, it shows their willingness to pay was at least the price. It does not reveal their maximum. Disney sees who buys, when, and at what price. The rest of us mostly see prices and whether passes sold out.

What Disney is selling

At Walt Disney World, Premier Pass gives a guest one entry to each available Lightning Lane attraction in a single park, with no arrival windows to schedule. It is sold separately from park admission.

Disney is not selling a new ride. It is selling a different way to experience the rides it already runs.

Premier sits at the top of a ladder. Guests can wait in the standby line at no extra cost, buy a Single Pass for one specific ride, buy a Multi Pass and book return times, or buy Premier and skip the planning altogether. Each step up trades more money for less waiting and more flexibility, and each guest picks the step that matches what they value.

A regular visitor may be happy to plan around standby lines. Someone with one day in the park, young children, or older relatives may value control of the day far more. That is the strategy question behind Premier Pass: how much will a customer pay to make an already expensive vacation easier?

To find out, I examined historical prices, reported sellouts, management commentary, analyst coverage, and guest reactions.

The price record

I tracked Premier Pass prices for all four Walt Disney World parks on every date from its October 30, 2024 launch through October 11, 2026: 712 consecutive days and 2,848 park-date prices.

The highest price I found for a specific visit date was $449 per person, and October 2026 reporting describes a new ceiling of $499. (MousePlanet, WDW Prep School) For a family of four at $449, that is $1,796 before tax, on top of park tickets.

But prices have not simply marched upward. At Magic Kingdom, the average posted price rose 3.2%, from $387.82 to $400.27, comparing the same calendar periods a year apart. Across all four parks the increase was 1.9%, and from July to September, average prices actually fell about 5.8%.

These averages weight every date equally, so they are not the average price Disney actually collected. But the pattern is clear: the ceiling rose while typical prices moved modestly. Premier is priced day by day and park by park.

Sellouts: where demand concentrates

I found 337 reported sold-out park-dates. The most interesting finding is where they happened: Magic Kingdom accounts for 162 of them, about 48%.

One possible explanation is that easier access is worth more where there are more attractions and longer waits. Reported sold-out days also carried higher posted prices: about $339 on average, versus $260 on other days.ut a sellout only tells us the available passes ran out. It does not tell us how many there were. One hundred passes and one thousand passes can both sell out.

How much revenue could Premier generate?

Disney does not disclose Premier Pass revenue or profit. The most concrete published forecast came from Goldman Sachs analyst Michael Ng in October 2024: about one million purchases in 2025 across the two US resorts, worth a reported $220 to $230 million. (Benzinga’s report on the Goldman forecast)

Volume is the number that matters, and it is the one we cannot see. Using actual posted prices over the past twelve months, 250 sales per park per day would add up to about $99 million a year at Walt Disney World. At 1,000 a day, about $397 million.

The more consequential question is how much of a Premier purchase is new spending, and how much replaces something Disney would have sold anyway, like a Multi Pass or a VIP tour.

As an investor, that is the question I would ask next: does Premier increase total spending per visit, or simply change where that spending goes?

Why the economics could be attractive

Premier does not require Disney to build anything new. It repackages access to attractions that already exist. But ride capacity is finite, operations and staffing still cost money, and some purchases displace others.

For scale, Disney’s Experiences segment reported $36.2 billion in revenue and $10.0 billion in operating income in fiscal 2025. (Disney FY2025 results) Even Goldman’s full forecast would be well under 1% of that revenue.

What guests say they are buying

Across the Reddit threads, forums, and reviews I read, satisfied buyers kept coming back to the same things:

  • Less time managing reservations on a phone

  • More freedom to change plans

  • Less backtracking across the park

  • Easier days with children or older relatives

  • More confidence about fitting a short or busy visit in

Critics pointed to the cost for families, cheaper alternatives, the loss of free FastPass, and the idea that guests now pay to remove planning friction from their own vacations.

Before Lightning Lane, skipping the line was free with FastPass+. Photo: Theme Park Tourist, CC BY 2.0

Value also varied by park. Many guests favored Premier at Magic Kingdom or Hollywood Studios, some described great EPCOT days, and Animal Kingdom drew the most skeptical comparisons.

What the premium really buys is control over time, and less work planning the day. (WDWNT Magic Kingdom review, AJC on EPCOT, Disney Tourist Blog on value)

Waiting in the standby line at Magic Kingdom. Photo: Jeremy Thompson, CC BY 2.0

My take

I think Premier Pass is a very smart strategy. Disney adds meaningful revenue with a product that costs very little to deliver to each additional guest. As long as it stays limited, so that it doesn’t come at the expense of everyone else in the park, it’s a beautiful option.

I’ve bought it myself. Last Christmas we went with a group that included my parents, who simply don’t want to wait in line. We didn’t want to spend the day planning which ride we’d get to when. It worked. But you pay for it, and it’s not for every day.

I’m also aware of the growing perception that Disney is getting too expensive. That deserves its own discussion: what the average visitor gets with a base ticket, which add-ons are worth it, and what’s included. I’ll come back to it here.

And I think Disney is just getting started. Expect more premium tiers: more paid layers of access, perks, and add-ons across the parks and beyond.

The lesson for founders: tier your customers

This is the question I think about all the time: how do you charge for something many people see as real value, in a way that also contributes meaningfully to revenue and profit?

Disney’s answer is to stop treating every customer the same. Some visitors will happily spend time planning and waiting. Others, like my parents, will pay a substantial premium to skip it. Same park, same rides, very different willingness to pay. And the premium tier costs very little to deliver.

Disney is not alone, and you don’t have to be in travel to do this. Some of the best businesses charge for speed, access, or capability they already have:

  • The Empire State Building sells an Express Pass from $87, versus $46 for general admission. Same elevator, same view, shorter line. (ESB tickets)

  • Tesla sells an Acceleration Boost for the Model Y for $2,000. It is pure software that unlocks performance the car already has, taking 0 to 60 from 4.6 seconds to 4.2. (Karmactive)

  • Costco Executive members pay $130 a year instead of $65 for 2% back and, since June 2025, an hour of early shopping. Opening the doors early costs Costco almost nothing, and Executive members drive about 75% of its worldwide sales. (Costco 10-K, TipRanks)

  • Tinder launched Tinder Select in 2023, reportedly at $499 a month, offered to fewer than 1% of users: its most active members. Every feature is software. (FOX 5, citing Bloomberg)

  • Apple charges $1,099 for a 256GB iPhone 17 Pro and $1,299 for 512GB. Same phone, more room, priced on what the customer values. (AppleInsider)

There is a warning, too. BMW charged about $18 a month in some countries to turn on heated seats already built into the car. The backlash was strong enough that BMW dropped it in 2023, and its head of product communications called it “probably a mistake.” (TechSpot) It is the same lesson Disney faced when free FastPass disappeared: customers will pay for added value, but they resent paying to remove a restriction you created.

Tokyo shows the other side. After replacing free FastPass with paid Premier Access, its operator raised spending per guest from ¥11,815 in 2018 to ¥18,403 last year and set a revenue record, naming Premier Access as a driver. But visits have fallen from 32.6 million to about 27 million, and visitors under 18 are down nearly 30%. Fewer guests paying more works, until it stops building the next generation of fans. I was one of those kids.

For your own business, the menu of low-cost premiums is short:

  • Speed: priority service or faster turnaround

  • Certainty: a guaranteed spot

  • Flexibility: free changes or cancellation

  • Access: early or exclusive entry

  • Unlocks: capabilities you have already built

So every founder should ask: who are my different customers, what is each group willing to pay for, and what can I offer them using assets I already have?

The takeaway

Premier Pass shows how much some customers value control over their time. Disney’s challenge is to capture that value while preserving the experience that makes the premium worth paying.

For me, that combination of strategy, customer psychology, and open financial questions is why Disney is still such a fascinating business.

I started by looking at the pictures in its annual reports. I am still finding new things to study.

Have you ever paid to skip the line at Disney? Was it worth it, or are you a standby loyalist? Tell me in the comments. I’ll share the best answers in a future issue.

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How I did this: Prices were collected for all four Walt Disney World parks for every date from October 30, 2024 through October 11, 2026. Where sources disagreed on a price (30 park-dates), both values were kept. Sellouts are documented reports counted once per park-date, not a complete record. Price averages weight every date equally. Revenue figures are illustrations, not estimates; Goldman’s reported assumptions reconstruct to $214.9 million, slightly below its headline range. Tokyo figures come from Oriental Land’s results and BigGo Finance.

Mouse Money is independent analysis and is not affiliated with The Walt Disney Company.

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