It's not business as usual for theme park operators in Central Florida. Walt Disney (DIS 0.18%), Universal Orlando parent Comcast (CMCSA -0.37%), and SeaWorld Entertainment (SEAS) aren't exactly hitting the ground running heading into historically potent summer season.
The ghosts of vacations past, present, and future are haunting Orlando these days.
- Orange County's tourist tax -- a 6% charge levied on guests of area hotels and other short-term lodging rentals -- experienced a decline in collections for the month of April, capping a streak of 14 consecutive months of year-over-year gains.
- Disney World is offering Florida residents discounts on multiday tickets this summer, along with deals to save as much as 30% on stays of its on-site resorts. Rivals are also promoting summertime deals for locals.
- The Orlando Sentinel is reporting this week that a couple of tech and nursing conventions have canceled upcoming conferences at the Orange County Convention Center in response to recent polarizing political moves in Florida.
It's not just thunderstorms pouring in Central Florida right now. Disney, Universal, and SeaWorld will need to keep making moves to make sure that they're able to ride out the economic rainfall.
As the turnstile turns
The streak of booming revenue from overnight visitors wasn't going to last forever. It's probably not a coincidence that the run would end in April, as Disney World completed an 18-month celebration of the resort turning 50 at the end of March. It's not a surprise that Disney World would begin offering its full slate of annual passes again in April. The county was still able to collect a whopping $33.6 million in April from the tourist tax, so it's not as if hotels are smarting. The only problematic aspect of the inevitable dip is that Disney World officially introduced its highly anticipated Tron Lightcycle Run coaster in early April.
It's not just Disney World offering price breaks. Comcast's Universal Orlando may have turned heads by raising annual pass prices by as much as 23% in the springtime, but it's also now offering Florida residents a deal to buy a three-day multi-park ticket for the price of a one-day admission through the end of September. SeaWorld has also offered limited-time deals in recent weeks. The ticket deals are a bit extreme, but it's not unusual for operators to pump out promotions even during peak travel periods.
Image source: Walt Disney.
Losing conventions can be problematic, especially since most of the major trade shows and industry conferences take place during the seasonal lulls. It remains to be seen if the changes in the state that are repelling some groups will attract others in its place.
The potential slowdown in the coming months also shouldn't take away from the remarkable recovery for the region's iconic theme parks industry. The parks were shuttered for three to four months three years ago. Now they are largely posting record financial results. Revenue per guest is markedly higher for all operators compared to their pre-pandemic performances.
Now that Disney has introduced its Tron-themed thrill ride and SeaWorld Orlando has opened its Pipeline surf coaster there isn't a lot to look forward to in terms of major attractions coming online this summer. The biggest new experience expected this summer is the repurposed Minions Land at Universal Studios Florida, followed by Disney World's walk-through Moana-themed Journey Into Water attraction at Epcot later this year.
It's still too soon to give up on the area's travel and tourism stocks. The industry has evolved during the initial pandemic downtime, making the players stronger. The publicly traded participants will be vulnerable to any economic setbacks, but the long-term prospect remains promising and bullish.
