With its theme park business booming despite a slowdown in international turnstile clickers, NBCUniversal parent Comcast (CMCSA -0.37%) is all in on completing its new and ambitious Epic Universe theme park. The cable, content, and connectivity giant announced during Thursday morning's earnings call that the new gated attraction currently in the early construction phase near its Universal Orlando resort in Florida should open in 2025, and definitely in time for that year's peak summer travel season.
It's been three years since Comcast unveiled plans for Epic Universe, including an initial opening date of 2023. The pandemic halted construction, but obviously more than just that is factoring into what will be a two-year delay for the new theme park. With the new park located a couple of miles outside of Universal Orlando the logistics remain to be solved on how they will transport visitors from one resort to the other through the heart of the area's tourist corridor with several hotels and attractions that they don't own.
Image source: Universal Orlando.
Epic games
A lot can happen between now and 2025, and that includes pushing out the opening date again. With its theme parks business bouncing back a lot faster than anyone expected, the real shame is that it wasn't able to stick to its original 2023 debut. Rival Disney (DIS 0.18%) is knee-deep into an 18-month celebration of the 50th anniversary of its Disney World resort in Florida. It will be drawing a lot of attention until the festivities conclude at the end of March of next year, including a pair of highly anticipated themed roller coasters opening in the next year and change.
Disney World will likely take a breather in 2023, and that would've been an ideal time to strike the Central Florida market with a brand new theme park. Pushing Epic Universe out another two years will likely mean Disney World cranks out new tourist-luring attractions by then. The House of Mouse doesn't stand still for long.
There's also something to be said about momentum. Universal Orlando just capped off its most profitable quarter ever. Despite a surge in the omicron variant in the Sunshine State, inflation and high gas prices that are keeping road trips in check, and international travel restrictions, Comcast's amusements arm is rocking. Revenue nearly tripled for the segment in its latest quarter. The year-over-year comparisons are kind. The original Universal Studios Hollywood park in California was closed a year ago, and a new park just opened a few months ago in Beijing. However, even taking away all of those variables the Orlando-based resort has never delivered as well as it just did on the bottom line for Comcast.
This is all made even more impressive considering that travel restrictions have kept a lot foreign visitors away. Universal Orlando guests are typically just above 30% of its customer mix. Right now it's clocking in at just 20%. There's a lot of upside just waiting to be tapped, and having a brand new gated attraction next year would've been a game changer -- and even Comcast agrees.
"One of the things I wish we could redo was slowing down Epic," CEO Brian Roberts said during Thursday's call.
Investing takeaways
Comcast may be making theme park fans wait for Epic Universe, but it doesn't make investors wait for financial updates. It's typically the first of the market's theme park operators to report. Disney will report its quarterly results for the same three-month period on Feb. 9. SeaWorld Entertainment (SEAS) has historically posted its results in the final week of February.
A strong report out of Comcast -- at least for its theme parks business -- bodes well for Disney and SeaWorld Entertainment, the latter about to open several new thrill rides across its parks in the coming weeks. All three operate tourist attractions in Central Florida and Southern California. SeaWorld Entertainment also has the benefit in this case of being a pure play in theme parks. Consumers are flocking to year-round theme park attractions, and that momentum could trickle into strong spring and summer seasons for the regional amusement park operators. If you've been waiting to ride entertainment stocks it may be time to get in line.
