Disney Parks: Record 2025 Growth, Slower 2026 Forecast

The Walt Disney Company consistently commands global attention, with its operations frequently making headlines, whether related to adjustments in theme park admissions, streaming service fees, or various corporate policy discussions. This week’s financial disclosures, following the company’s November 13 earnings call, sparked a significant market reaction, culminating in an almost 8% decline in share prices. Such a substantial drop might suggest adverse underlying performance; however, a closer examination of Disney’s fourth-quarter and full-year results for fiscal year 2025 reveals a narrative of robust growth, predominantly fueled by its Parks and Experiences division. This segment has consistently served as a reliable engine for expansion, particularly as the traditional media divisions navigate an evolving landscape marked by considerable revenue pressures.

Key Points:

• Disney reported strong fourth-quarter and full-year results for FY25, with the Parks and Experiences division leading growth.
• Fiscal Q4 revenue was $22.46 billion (flat year-over-year), while net income surged to $1.31 billion, a significant increase from $460 million.
• Full-year FY25 revenue reached $94.4 billion, and net income hit $12.4 billion, marking increases of 3% and 170%, respectively.
• Adjusted earnings per share were $1.11 for Q4 and $5.93 for the full year, up 19% from FY24.
• The company announced plans to double its share-repurchase authorization to $7 billion and raise its annual dividend to $1.50 per share, reflecting strong confidence in cash flow.
• The Experiences segment recorded a record operating income of $1.9 billion for Q4 (up 13%) and $10 billion for the full year (up 8%).
• International Parks & Experiences operating income rose 25%, driven by higher attendance and guest spending, while Domestic parks saw 9% growth due to cruise-line performance.
• Bookings for fiscal 2026 Q1 are up 3%, with guest spending at Walt Disney World Resort increasing by 5%.
• FY26 guidance anticipates high-single-digit percentage growth in segment operating income, weighted towards the second half, suggesting a moderation compared to FY25.
• Increased operating costs, including $160 million in pre-opening expenses for new cruise ships (Disney Adventure, Disney Destiny) and $120 million in dry-dock expenses, are factored into the FY26 outlook.
• Disney continues significant investments in global parks and five new cruise ships post-FY26, including the new Disney Destiny launching this month and Disney Adventure in March 2026.
• U.S. park attendance saw a modest decline (~1%), but this was offset by increased guest spending, robust international attendance, and strong cruise-line growth.
• The company is shifting its strategy towards yield over volume, employing dynamic pricing, premium experiences, and cross-platform integration to maximize revenue per guest.

Financial Highlights: A Year of Robust Performance

Despite the initial apprehension from the market, evidenced by the share price drop, The Walt Disney Company’s financial reporting for fiscal year 2025 painted a picture of underlying strength. For the fourth quarter, the company posted revenues of $22.46 billion, which remained largely consistent year-over-year. However, a more striking figure emerged from its net income, which saw a significant surge to $1.31 billion, a substantial increase from $460 million in the same period a year prior. This impressive leap underscores effective cost management and revenue optimization strategies across various business units.

Examining the full fiscal year, Disney reported total revenues of $94.4 billion and a net income of $12.4 billion, reflecting increases of 3% and an extraordinary 170% respectively. This robust full-year performance highlights the company’s resilience and strategic execution in a dynamic economic environment. Adjusted earnings per share further reinforced this positive trend, reaching $1.11 for the quarter and $5.93 for the full year—a notable 19% increase from fiscal year 2024. In a clear signal of confidence in its sustained cash flow generation and future prospects, Disney also announced plans to double its share-repurchase authorization to an impressive $7 billion and concurrently raise its annual dividend to $1.50 per share, benefiting shareholders directly.

The Engine of Growth: Disney Parks & Experiences Soar

The standout performer in Disney’s recent financial narrative is undeniably its Experiences segment, encompassing its world-renowned theme parks, luxurious resorts, and expanding cruise line operations. This division has not only met but exceeded expectations, delivering a record operating income of $1.9 billion for the fourth quarter, representing a robust 13% increase compared to the prior-year quarter. For the entirety of fiscal year 2025, the Experiences unit generated a remarkable $10 billion in revenue, marking an 8% increase and solidifying its position as the company’s most reliable growth engine amidst evolving market dynamics.

A deeper dive into the segment’s performance reveals nuanced drivers of this success. International Parks & Experiences demonstrated exceptional vitality, with operating income surging by 25%. This impressive growth was primarily attributable to heightened attendance figures and an observable increase in guest spending across its international properties, albeit partially offset by elevated operational costs associated with the introduction of new guest offerings. Concurrently, the domestic parks experienced a respectable 9% growth in income, primarily bolstered by the strong performance of Disney’s cruise line. Looking ahead, bookings for fiscal year 2026 Q1 are already showing promising signs, up 3%, while guest spending at the flagship Walt Disney World Resort has seen a healthy 5% increase, indicating continued consumer demand for premium experiences.

Navigating Future Horizons: Growth Moderation in 2026

While fiscal year 2025 concluded with record-breaking achievements, Disney’s forward-looking guidance for fiscal year 2026 suggests a more measured pace of growth. The company anticipates a high-single-digit percentage increase in segment operating income compared to fiscal 2025, with growth expected to be more heavily weighted towards the second half of the year. This projected moderation reflects a strategic balancing act between capitalizing on past successes and investing for long-term sustainability.

A significant factor contributing to this tempered outlook is the anticipation of increased operating costs. Executives highlighted substantial pre-opening expenses totaling $160 million, primarily driven by the upcoming launches of the Disney Adventure and Disney Destiny cruise ships. Additionally, $120 million has been allocated for dry-dock expenses, further impacting the profitability margins in the initial half of the fiscal year. These figures, while substantial, underscore Disney’s unwavering commitment to enhancing its global fleet and park infrastructure. Consequently, while the trajectory of growth remains positive, these financial commitments imply that year-over-year gains in fiscal 2026 may not reach the same record-setting levels observed in fiscal 2025, particularly during the earlier quarters.

Strategic Investments for Sustained Momentum

In a testament to its long-term vision, Disney is committing substantial capital to expand and enhance its global network, with a particular focus on the high-performing Parks and Experiences sector. The strategic roadmap for late 2025 and 2026 outlines several ambitious projects designed to fortify its market leadership and broaden its appeal to an international audience. Key among these initiatives are the introduction of two state-of-the-art cruise ships: the Disney Destiny, set to launch this month, and the Disney Adventure, slated to become the first Disney ship home-ported in Asia in March 2026.

Beyond its cruise line expansion, Disney is actively pursuing significant development projects across its major theme parks worldwide. These include new attractions and enhancements at iconic destinations such as Disneyland Paris and Hong Kong Disneyland, alongside the ongoing development of a brand-new theme park in Abu Dhabi. This comprehensive investment strategy underscores the company’s dedication to innovation and maintaining a best-in-class entertainment offering. As CEO Bob Iger and CFO Hugh Johnston emphasized during the earnings call, "With expansion projects underway at every one of our theme parks, five additional cruise ships scheduled for launch beyond fiscal 2026, and a new theme park planned for Abu Dhabi, the strategic investments we are making now will help ensure our offerings remain best-in-class and appeal to audiences worldwide well into the future."

Evolving Attendance Dynamics and Yield Management

While Disney's international park attendance remained robust, its U.S. park attendance experienced a modest decline of approximately 1%. However, the company adeptly mitigated this slight dip through a combination of enhanced guest spending, continued strong international visitor numbers, and consistent growth within its cruise line segment. This strategic pivot reflects an increasing organizational focus on maximizing yield rather than solely pursuing volume. Disney is strategically employing dynamic pricing models, curating premium experiences, and leveraging cross-platform integration with services like Disney Plus to optimize revenue per guest.

This shift in strategy is a pragmatic response to market realities. As TheStreet Co-Editor and Disney travel expert Dan Kline observed, "At its theme parks, Disney can deliver a better experience by charging higher prices and selling fewer tickets. That may not be something people want to hear out loud, but it’s a reality." This approach allows Disney to manage crowd levels more effectively, potentially enhancing the guest experience while simultaneously boosting financial returns. The confluence of resilient international growth and a concerted effort to increase per-guest spending effectively sustains overall revenue, even in the face of domestic attendance figures showing signs of plateauing.

Conclusion

The Walt Disney Company's Parks and Experiences unit continues to stand as its most vital growth engine, delivering record-breaking performance in fiscal year 2025. While guidance for fiscal year 2026 suggests a more moderate pace of growth due to significant strategic investments and associated operating costs, the company’s expansive plans for cruise line and global park developments position it for sustained long-term momentum. Disney’s proactive approach to yield management, coupled with its robust international presence, ensures its continued leadership in the global entertainment and leisure industry.