Disney theme parks are taking a hit as international tourists skip the U.S.
Disney‘s earnings are out, and by the looks of it, the entertainment giant is starting 2026 with some strong points in its first-quarter report, powered in part by two big hits at the box office. However, some disappointing news looking ahead to the second quarter may have spooked investors, causing shares of the stock to slide over 7% to $104.72 in afternoon trading on Monday.
Shares of the Walt Disney Company (DIS) were up briefly on Tuesday morning after news that Disney named Josh D’Amaro as its new chief executive officer (starting March 18), but were back down by another half a percent to $103.99 in afternoon trading on Tuesday at the time of this writing.
First, the good news: Disney’s first quarter earnings beat estimates with revenue coming in at $25.98 billion, above analyst expectations of $25.74 billion; and higher-than-expected earnings per share (EPS) of $1.63 adjusted, 6 cents above Wall Street estimates of $1.57.
That’s due in large part to the entertainment giant’s experiences unit, which operates 12 theme parks across six global resorts, along with cruises and vacation clubs, which reported more than $10 billion in quarterly revenue for the first time.
It also got a nice boost from Disney’s box office blockbuster releases “Zootopia 2” and “Avatar: Fire and Ash,” which each surpassed $1 billion at the global box office, according to Disney’s earnings report. The company also highlighted its streaming services, and said sports channel ESPN delivered strong quarterly ratings (with “ESPN capturing more than 30% of all sports viewership across networks, including ESPN on ABC”).
Now, the bad news: Disney cautioned that looking ahead to its second quarter, it forecasts that its theme parks will likely see “modest operating income growth” due in part to the decline in visits from international tourists to the U.S., the Associated Press reported.
In an answer to a question about the decline on Monday’s earnings call, Disney CEO Bob Iger said because international visitors tend to stay in Disney hotels less, the company was “able to read it from other indicators,” and as a result “pivoted marketing and sales efforts . . . to a more domestic audience” and was “able to keep attendance rates high.”
That overall drop in foreign tourism to the U.S. could likely be the result of a few different factors, including President Donald Trump’s crackdown on immigration; his administration’s aggressive stance toward foreign countries—including our close European allies and Canada—over the U.S. invasion of Venezuela and push to take over Greenland; and his high tariffs on global nations, often accompanied by anti-foreigner rhetoric.