Disney’s parks are its top money maker — and it plans to spend $60 billion to keep it that way

Three
years
ago,

Josh
D’Amaro
stood
in
a
nearly
empty
Disneyland.

The
California
theme
park’s Main
Street
was
quiet:
no
cheery
tunes
from
famed
barbershop
quartet
the
Dapper
Dans,
no
clanging
railroad
bell,
and
no
wafting
scent
of
waffle
cones
from
the
Gibson
Girl
Ice
Cream
Parlor.

It
had
been
more
than
a
year
since
the
Covid
pandemic
had
forced
Disney’s
domestic
parks
to
shutter,
but
D’Amaro,
chair
of
Disney’s
experiences
division,
was
confident
guests
would
flood
back
in
when
the
gates
reopened.

His
confidence
was
well
founded.
D’Amaro’s
division
is
now


Disney‘s
best-performing
segment,
rebounding
and
offering
stability
in
recent
quarters
as
Disney
shuffles
to
adapt
its
entertainment
business
to
match
consumer
habits
that
changed
after
the
pandemic.

On
that
quiet
day
in
2021,
D’Amaro
had
been
in
charge
of
the
parks,
experiences
and
consumer
products
division,
now
just
called
experiences,
for
only
a
little
more
than
a
year.
He
took
the
helm
when
Bob
Chapek
was
tapped
as
CEO
in
early
2020.
D’Amaro
spent
much
of
those
12
months
dealing
with
substantial
operating
losses
from
global
park
closures,
a
docked
fleet
of
cruise
ships
and
a
plunge
in
hotel
visits.

Revenues
fell
35%
in
2020,
a
nearly
$10
billion
decrease
from
the
$26.2
billion
the
experiences
division
had
tallied
in
the
year
before
the
pandemic.
Then
revenue
dropped
an
additional
3%
in
2021.

But
a
lot
has
changed
in
three
years.
D’Amaro
—
sitting
in
a
conference
room
in
Burbank,
an
hour
north
of
Disneyland
and
just
a
few
miles
from
the
heart
of
Disney’s
theme
park
creative
engine,
Walt
Disney
Imagineering
—
has
much
to
brag
about.

The
experiences
division
posted
record
revenue
of
$32.5
billion
in
fiscal
2023,
a
16%
increase
from
the
prior
year.
Operating
income
jumped
23%
to
$8.95
billion.

D’Amaro
described
the
pandemic
as
“an
opportunity
to
take
a
breath”
and
a
time
for
his
division
to
“think
about
what
we
wanted
the
future
to
look
like.”

“So,
as
difficult
as
that
situation
was,
we
saw
it
as
a
platform,
a
new
vantage
point
for
us
to
look
at
the
operation,”
he
said.

While
its
parks
were
shuttered,
Disney

continued
construction
of
its
Avengers
Campus
themed
land
in
Disneyland
and
touched
up
old
favorites
such
as
the
King
Arthur
Carousel.
And
it
built
new
rides,
and
refurbished
others,
in
the
years
that
followed.

World
of
Frozen
opened
in
Hong
Kong
Disneyland
in
November,
and
a
Zootopia
land
opened
in
Shanghai
Disneyland
in
December.
The
company
also
launched
two
new
rides
at
Walt
Disney
World
in
Florida:
a
“Guardians
of
the
Galaxy”-themed
ride
in
its
Epcot
park
in
2022,
and
a
“Tron”-themed
roller
coaster
in
the
Magic
Kingdom
in
April
2023.

Additionally,
the
company
has
revamped
attractions
and
themed
park
areas,
turning
the
Pacific
Wharf area
of
Disneyland’s
California
Adventure
into
San
Fransokyo
Square,
based
on
the
animated
hit
“Big
Hero
6,”
updating

Mickey’s
Toon
Town
at
Disneyland
and
making

major
transformations
at
Epcot.

Those
investments,
coupled
with
new
technology
in
mobile
ordering
and
the
ability
for
guests
to
pay
to
skip
to
the
front
of
the
line
for
certain
rides,
have
kept
guests
coming
and
boosted
Disney’s
earnings
at
a
time
when
the
entertainment
division
is
struggling
to
recapture
its
late-2010s
boom.

“Sitting
here
now,
today,
you’ve
seen
our
results;
our
results
have
been
record-setting
as
recently
as
the
last
first-quarter
earnings,”
D’Amaro
said.
“Record
revenue,
record
margins,
record
operating
income.
So,
the
recovery
has
been
swift,
it’s
been
strong.
But
more
importantly,
I
think
the
future
looks
incredibly
bright
for
our
segment
—
and
the
company,
quite
frankly.”

In
2023,
experiences
was
the
best-performing
part
of
Disney’s
business,
accounting
for
36%
of
the
company’s
total
revenue
but
70%
of
its
operating
income.
Meanwhile,
Disney’s
entertainment
division,
which
includes
its
theatrical
and
streaming
businesses,
represented
45%
of
revenue
but
just
11%
of
operating
income.

The
ability
to
get
more
out
of
the
parks
in
recent
years
was
crucial
for
CEO
Bob
Iger
and
Disney’s
board
as
they
tried
to
make
the
company
more
profitable
and
improve
share
performance.
On
Wednesday,
Disney

beat
back
activist
investor
Nelson
Peltz’s
proxy
fight,
reelecting
its
full
board.

The
division’s
strength
is
why
Disney
has
pledged
to

invest
$60
billion
in
experiences
over
the
next
10
years
—
a
key
part
of
its
strategy
to
keep
the
parks
fresh
and
relevant
in
a
competitive
segment.

D’Amaro
said
about
70%
of
that
money
will
go
toward
“new
experiences”
in
domestic
and
international
parks,
along
with
cruise
lines.
The
other
30%
will
go
toward
technology
and
infrastructure,
including
maintenance
of
existing
attractions.

Innovation
at
theme
parks
has
been
a
central
goal
since
Walt
Disney
ran
the
company.
Disney’s
founder
used
to
say
that
its
theme
parks
would
“never
be
finished”
and
would
evolve
to
meet
consumer
demand
and
changing
tastes,
along
with
developments
in
technology.

Walt
Disney
Imagineering
has
long
been
on
the
cutting
edge
of
development.
Its
innovations,
from
ride
mechanics
and
animatronics
to
creature
design
and
immersive
architecture,
have
made
Disney’s
parks
a
standout
in
the
industry.

Last
year,
guests
caught
a
glimpse
of
one
of
these
innovations
—
a
trio
of
tottering
bipedal
robots
from
Star
Wars
called
BDX
droids.
First
spotted
at
California
Disneyland’s
Star
Wars:
Galaxy’s
Edge,
they
are
just
one
iteration
of
a
new
technology
Disney
Imagineering
is
developing
to
bring
walking
robotic
characters
to
life.

Engineers
create
the
mechanics
for
the
remote-controlled
droids
to
move
and
balance,
and
work
with
animators
to
give
those
movements
personality.
The
robots
were
designed
to
have
childlike
curiosity,
reflected
through
cheeky
head
tilts
and
chirping
beeps,
along
with
a
special
emote
dubbed
“tantrum,”
where
their
eyes
glow
red
and
they
emit
a
high-pitched
squeal.

Guests
who
visit
Galaxy’s
Edge
in
the
next
three
months
may
stumble
across
this
trio
as
part
of
Disney’s
“Season
of
the
Force.”
They
add
to
the
regular
roaming
character
meet-and-greets
with
the
likes
of
Rey,
Chewbacca,
Kylo
Ren
and
stormtroopers.

Disney
hopes
hands-on
innovations
such
as
the
robots
will
keep
guests
coming.

“Those
moments
where
there’s
a
spark,
there’s
an
emotion
that’s
on
full
display,
where
a
guest
is
interacting
with
an
attraction
or
a
cast
member
or
a
character,
it’s
very
real
and
genuine,”
said
D’Amaro.

That
emotion
was
on
display
at
the
South
by
Southwest
conference
in
March
2023,
when
Disney
debuted
a

new
iteration
of
its
“stuntronics”
robot,
this
time
in
the
form
of
Judy
Hopps
from
“Zootopia.”
This
technology
had
previously
been
used
to
create
the
Spider-Man
leap
stunt
at
Avengers
Campus.
During
the
2023
presentation,
Imagineers
showed
the
audience
how
the
Judy
Hopps
robot
could
balance
on
roller
blades
and
perform
somersaults.

The
biggest
audience
reaction
came
at
the
end
of
the
presentation,
when
an
Imagineer
lifted
the
bot
to
sit
on
his
shoulders
and
it
realistically
moved
its
legs
to
fit
around
his
neck,
as
a
child
would.
The
simple
motion
—
programmed
just
for
the
presentation,
Imagineers
told
CNBC
—
captured
something
intrinsic
to
the
human
experience.

D’Amaro
said
those
moments
show
why
it’s
important
for
Disney
animators
to
be
part
of
the
development
process:
As
the
Imagineers
craft
new
technologies,
the
artists
can
help
bring
them
to
life.

It
shows
in
Disney’s
rebrand
of
Splash
Mountain.
In
both
the
California
and
Florida
parks,
the
company
is
refurbishing
the

ride
into
Tiana’s
Bayou
Adventure,
which
will
feature
dozens
of
animatronic
characters
from
“The
Princess
and
the
Frog.”

Imagineers
have
developed
all-electronic
audio-animatronics
for
the
ride
for
characters
such
as
Lewis,
the
trumpet-playing
alligator
from
the
film.
Disney
revolutionized
animatronics
decades
ago
with
its
hydraulic,
or
liquid-fueled,
and
pneumatic,
or
air-fueled,
systems,
but
the
electronic
animatronics
for
Tiana’s
Bayou
allow
for
more
refined
and
precise
movement,
making
them
appear
more
realistic.
Similar
animatronics
can
be
seen
in
the
rides
Smuggler’s
Run
and
Rise
of
the
Resistance,
in
Galaxy’s
Edge.

Interior
pieces
of
some
of
the
animatronics
were
crafted
using
3-D
printing,
resulting
in
a
lighter-weight
material.

Disney’s
ambitions
to
grow
its
experiences
unit
hinge
in
part
on
making
its
attractions
feel
more
real.

“They
continue
to
push
the
envelope
of
storytelling
and
creativity,”
D’Amaro
said
of
the
Imagineering
team.

He
cited
the
recently
shuttered

Star
Wars
Galactic
Starcruiser,
a
hotel
and
immersive
experience
that
took
guests
on
a
two-day
“voyage”
in
space.
It
was
a
48-hour
interactive
story
that
allowed
fans
to
physically
play
in
the
Star
Wars
universe.

“This
is
something
that
had
never
been
done
before,”
D’Amaro
said.
“It
was
difficult
to
even
explain
to
the
public,
and
I
think
it
was
incredibly
brave
for
us
to
move
into
this
space.
…
And
this,
to
me,
says
Imagineering
is
still
at
its
best
today.”

High
ticket
prices
deterred
the
average
parkgoer,
and
the
Galactic
Starcruiser
shuttered
in
September.
Still,
D’Amaro
said
the
experiment
was
a
learning
opportunity
for
the
company.

“Those
learnings
are
being
employed
on
the
next
experiences,
which
we
haven’t
even
announced
yet,”
he
said.

Storytelling
is
at
the
heart
of
everything
across
Disney’s
experiences
division.

This
extends
to
Disney’s
cruise
line
and
hotels,
as
well
as
its
video
game
business.
The
company
has
a
fleet
of
five
cruise
ships,
and
plans
to
add
three
more
by
fiscal
2026.

The
Disney
Wish,
which
made
its
maiden
voyage
in
2022,
was
the
first
addition
to
the
fleet
in
a
decade
and

bet
big
on
its
powerhouse
franchises
to
entice
travelers
to
the
high
seas.

There’s
a
“Frozen”
sing-along
dinner
and
a
Marvel
dining
experience,
as
well
as
a
Star
Wars-inspired
Hyperspace
Lounge.
The
ship
also
has
the
first
ever
Disney
water
ride
attraction
on
board,
the
AquaMouse.

“This
is
something
I
think
that’s
really
important,
the
idea
of
the
Disney
difference,”
D’Amaro
said.
“That
this
company
works
together
as
one
is
more
powerful
now
than
I
think
it
ever
has
been
—
whether
it’s
[entertainment
co-chair]
Alan
Bergman
in
the
studios
creating
a
new
property
that
we
can
then
take
to
Disney
experiences
and
bring
it
to
life
and
extend
that
story
in
brand
new
ways,
or
franchises
that
are
birthed
out
of
the
theme
parks.”

Disney’s
experiences
division
has
immediate
expansion
plans
—
even
before
the
bulk
of
the
planned
$60
billion
investment
kicks
in.

Next
to
open
for
Disney
is
Fantasy
Springs,
an
eighth
port
at
the
Tokyo
DisneySea
park.
The
land
will
be
home
to
three
new
areas
—
inspired
by
the
films
“Frozen,”
“Tangled”
and
“Peter
Pan”
—
as
well
as
the
new
Tokyo
DisneySea
Fantasy
Springs
Hotel.

Concept
and
design
work
is
also
underway
for
the
Tropical
Americas
area
at
Disney’s
Animal
Kingdom
in
Florida.
There
have
been
no
official
updates
on
the
previously
announced
third
ride
at
Avengers
Campus
in
the
California
Adventure
area
at
Disneyland.

The
company
is
developing
what
it’s
dubbed

“blue
sky”
ideas
for
its
parks
—
projects
that
are
still
in
early
development
and
may
ultimately
not
see
the
light
of
day.

Disney
has
teased
that
an
area
based
on
“Coco”
or
“Encanto”
or
both
could
be
underway
in
the
Magic
Kingdom.
There
were
also
talks
about
opening
an
area
of
the
Magic
Kingdom
that
would
be
overrun
by
Disney
villains.

During
the
company’s
investor
meeting
this
week,
Iger
even
teased
the
possibility
of
an
“Avatar”
land
at
Disneyland
in
California.

“We
have
thousands
of
acres
of
land
still
to
develop,”
Iger
said
during
the
Morgan
Stanley
Conference
in
March.
“We
could
actually
build
seven
new
full
lands
if
we
wanted
to
around
the
world,
including
the
ability
to
increase
the
size
of
Disneyland
in
California,
which
everybody
thinks
is
kind
of
landlocked,
by
50%.”

Price
points
for
these
projects
will
vary,
if
they
do
come
to
fruition.
The
recent
additions
of
the
two
Star
Wars:
Galaxy’s
Edge
lands
in
Disneyland
and
Disney
World
are
estimated
to
have
cost
$1
billion
each.

That’s
where
the
$60
billion
investment
comes
in.

Disney
likely
won’t
spend
it
all
soon.

“We
actually
have
a
fairly
good
idea
in
the
near
term
of
what’s
being
built,
but
we’re
purposefully
not
going
to
allocate
it
all,”
Iger
said
at
a
media
event
Tuesday,

according
to
the
Los
Angeles
Times.
“Because
who
knows?
In
five
years
we
can
end
up
with
a
giant
hit
movie
—
think
‘Frozen’
—
that
we
may
want
to
mine
essentially
as
an
attraction,
or
a
hotel
or
restaurant
in
our
parks.
So
you
want
to
maintain
some
flexibility.”

But
Iger
won’t
be
head
of
the
company
in
five
years,
if
all
goes
according
to
plan.
The
CEO,
who
returned
to
the
post
in
2022,
is
set
to
step
down
at
the
end
of
2026.
Disney’s
board
is
in
the
process
of
succession
planning.

D’Amaro
is
on
the
short
list.

His
track
record
helming
Disney
experiences
is
part
of
a
26-year
career
with
the
Walt
Disney
Company,
in
which
D’Amaro
has
held
posts
as
chief
financial
officer
for
consumer
products
and
global
licensing
and
chief
commercial
officer
for
Walt
Disney
World
Resort.

For
now,
however,
D’Amaro
said
he
is
concentrating
on
his
current
post.
He
called
it
a
“blessing”
to
have
Iger
back
as
CEO.

“I’m
focused
on
Disney
experiences,”
he
said
when
asked
about
potential
succession
plans.
“And
I’m
focused
on
driving
innovation
and
storytelling
forward
and
paying
tribute
to
our
fans
and
continuing
to
grow
this
business.”