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Despite stalled growth in China, Brazil and Russia, a wave of newly middle-class travelers from the BRICs and beyond will start visiting international destinations in the coming decades — dwarfing the numbers we’ve seen thus far.
With all important metrics on the rise in the U.S. and ongoing global developments in high potential markets, Disney’s parks and resorts on track for profitable and high growth year.
Visitor growth and higher guest spend led to a 8-percent revenue increase at Walt Disney parks and resorts in the second quarter of 2014. Segment revenue reached $3.6 billion in Q2, up from $3.3 billion during the prior-year quarter.
Operating income at global parks and resorts grew 19 percent to $456 million due to higher spending at Walt Disney World Resort in Orlando, more visitors at Disneyland Resort in Anaheim, and an increased number of occupied room nights at both resorts.
Higher spend was caused by the rising cost of ticket prices as well as increased revenues from food and merchandise purchases. Revenue increases were partially offset by a change in the timing of the Easter holiday as well as increased spend on MyMagic+ bands and labor.
Globally, operating income at international parks and resorts remained relatively unchanged from the second quarter of 2013. An increase in visitor volume and spend at Hong Kong Disneyland Resort offset by a drop in both measures at Disneyland Paris, mirroring a shift in visitor trends worldwide.
Parks are traditionally the second largest revenue driver, but the segment was edged out this quarter due to a more than 100 percent spike in studio entertainment income. We imagine Disney executives are singing Frozen songs all the way to the earnings call.