Theme park attendance began softening in June, a trend that continues into the third quarter, according to Universal Destinations & Experiences parent company Comcast.
Despite the drops in attendance, though, Comcast still views the segment positively in the long run.
During Comcast's financial earnings call Thursday, CEO Mike Cavanagh said the theme park market was softer than expected in the second quarter.
"Unpacking this by geography, in Orlando, Epic Universe continues to perform well and is delivering the strong guest response we expected," Cavanagh said. "At the same time, attendance across the broader Orlando market began to soften in June, and that trend has continued into the third quarter."
Cavanagh attributed the decline in attendance to higher fuel prices and weaker consumer sentiment, both of which he called "temporary factors."
Universal's park in Osaka, Japan, has been affected by China curbing travel to the country, Cavanagh said, while its Beijing park has been affected by "a challenging macroeconomic backdrop."
"Despite these near-term pressures, our outlook for the long-term opportunity in parks is unchanged," he said. "We have great brands, great locations and a proven playbook for investing behind attractions and experiences that create real consumer demand and strong returns."
New theme parks and a spinoff
Universal's newest park, the Universal Kids Resort in Frisco, Texas, and the construction of its first U.K. park, provide further avenues for growth moving forward, he said.
Overall, theme park revenue was up 2.7%, totaling $2.41 billion in the second quarter. Ebitda was down 5.1% to $609 million.
Comcast CFO Jason Armstrong attributed the drop mainly to reduced attendance in Osaka. The U.S. parks saw growth in the quarter, however, with both Ebitda and revenue up in Orlando, despite attendance declines there, as well.
On the call, Comcast chair Brian Roberts also addressed the company's plan to spin off NBCUniversal, which includes its theme parks, film and television studios, creating two separate, publicly traded companies. Comcast announced the plan three weeks ago.
"Since then, we've talked with our key constituencies, employees at every level, most of our key partners, and the reaction has been overwhelmingly positive," Roberts said. "I feel more positive and energized today than I was on the day we announced it."
The spinoff, which executives said will better position both companies for new opportunities and growth, is expected to be completed in a year.
Copyright Northstar Travel Media, LLC. All rights reserved. From https://www.travelweekly.com. By Jamie Biesiada.