The Small But IMPORTANT Change Disney Just Made to Its Financial Reporting Model

Disney fans and investors alike share a strong interest in The Walt Disney Company’s financial health. In fact, Disney’s earnings calls consistently generate media attention and lead to a slew of analyst predictions.

©Disney

Ahead of The Walt Disney Company’s fourth-quarter earnings call, Disney is slightly altering how it reports its financial information. Let’s break it down.

For a little background, Disney CEO Bob Iger announced plans to restructure the company, effective immediately, during the first earnings call of 2023. Iger explained that Disney would be organized under three divisions: Disney Entertainment, ESPN, and Disney Parks, Experiences, and Products. During the earnings call, Iger also made some major announcements about restructuring at the company, cost-cutting measures, and new projects.

Disney CEO Bob Iger

Now, we have an update ahead of the final earnings call of 2023. On October 18th, Disney filed a Segment Reporting Changes notice to “provide summary recast segment financial information for the nine months ended July 1st, 2023, fiscal year 2022 and fiscal year 2021.”

Burbank Disney Company Headquarters ©️LA Times

The filing revealed that Disney’s theme parks segment had over $24 billion in overall revenue for the first nine months of 2023, a 17% increase compared to the first nine months of 2022, per CNBC. That revenue is now being reported in a slightly different way, though.

Magic Kingdom

According to CNBC, Disney used to report part of its theme park revenue in two categories:

Retail and wholesale sales of merchandise food and beverage
Merchandise licensing

Now, this information will be split into three categories:

Parks and experiences merchandise, food, and beverage
Merchandise licensing and retail
Park licensing and other

Theme park admissions and resorts and vacation revenue data will still be reported the same as before. These changes reflect how “Disney’s theme park revenue continues to grow even as the overall theme park industry has [a] slowdown in attendance and hotel room occupancy,” per CNBC.