Disney’s Theme Parks Fuel Growth Amid Economic Unease

May 7 2025

Credit: courtesy of Disney

NEW YORK - Despite ongoing economic anxiety and pressure on household budgets, The Walt Disney Company has delivered a strong performance in its latest quarterly results driven largely by the surprising resilience of its domestic theme park business.

In the three months ending this winter, Disney’s domestic parks division posted a 13% year-over-year increase in operating profit, reaching $1.82 billion. Revenue rose 9% to $6.5 billion, as consumer spending on tickets, food, merchandise, and hotel stays continued to climb, defying the broader trend of tightening discretionary spending.

The performance underscores Disney’s unique position in the consumer landscape. While many Americans are reining in nonessential purchases amid inflationary pressure, a Disney vacation remains, for many, a “non-negotiable” expense. Attendance and hotel bookings were both up across domestic resorts, reflecting a broader willingness among consumers to spend on immersive experiences.

The company’s Experiences division, which includes its international theme parks, cruise line, and consumer products business, also remains a powerful growth engine. Disney reiterated its guidance for operating profit growth of up to 8% for the full year, doubling the growth rate seen in 2024. This segment now contributes roughly 60% of the company’s annual operating profit, highlighting a strategic shift toward experience-led revenue.

In a notable global expansion, Disney announced plans to open its seventh resort destination, Disneyland Abu Dhabi, in partnership with the UAE-based Miral Group. CEO Robert A. Iger described the move as “a huge endorsement of that location,” citing robust tourism growth in the region.

The robust performance of the parks division helped lift Disney’s adjusted earnings per share by 20%, coming in at $1.45, well ahead of Wall Street expectations. In response, Disney’s stock jumped 10% in early trading.

Disney’s direct-to-consumer business also beat expectations. Analysts had anticipated a dip in subscribers following price hikes and content reductions, but instead, Disney+ added 1.4 million new users, ending the quarter with 126 million subscribers. The streaming division, which includes Disney+, Hulu, and ESPN+, reported $336 million in operating profit, a significant jump from $47 million a year earlier.

However, the company’s traditional television business continued to underperform. Revenue declined 13% to $2.4 billion, as linear TV viewership and advertising revenue both dropped. Programming cuts did help limit losses, with the segment posting a modest 2% increase in operating profit ($769 million).

The sports division, home to ESPN, was also under pressure. Higher operating costs and a write-down tied to the shuttered Venu sports streaming venture weighed on results, leading to a 12% year-over-year decline in operating income, to $687 million.

The film division delivered lackluster results this quarter. While carryover successes like Mufasa: The Lion King buoyed the segment, underperformers such as Snow White offset gains. Overall, the segment remained flat.

While Disney faces challenges in its traditional media and sports segments, its theme parks and streaming businesses are demonstrating impressive resilience and adaptability. The company’s strategic investments both domestically and internationally signal confidence in its long-term vision: anchoring growth in experiential entertainment while adapting to the digital future.

In a climate where many brands are bracing for contraction, Disney is doing what it has always done best, inviting consumers to escape, spend, and return for more.