As Hurricane Milton intensifies towards central Florida, a Category 5 storm, Goldman Sachs has estimated a potential financial blow to Walt Disney World’s Parks and experiences. The investment bank projects a loss of $150 million to $200 million for the current quarter, primarily driven by a predicted drop in domestic attendance. This translates to a 6% year-over-year decrease in attendance growth, a stark contrast to the earlier projected 2% decline.
Drawing parallels to previous hurricanes, analyst Michael Ng points to Hurricane Irma in 2017, which resulted in significant operational disruptions for Walt Disney Co. Irma caused a $100 million hit to operating income and a 3 percentage point decrease in domestic park attendance. The storm forced the closure of Walt Disney World for two days, along with numerous cruise ship itinerary cancellations. Considering Disney’s 10% compound annual growth rate (CAGR) in its Parks & Experiences segment since 2017, Ng has scaled up his estimates for Hurricane Milton’s potential impact, reflecting the company’s expanded operations and increased revenue base. The report notes that hurricanes like Hurricane Ian (2022) and Hurricane Matthew (2017) also caused notable disruptions, leading to adverse impacts of $65 million and $70 million, respectively, on Disney’s operating income.
While Walt Disney World is currently operating under normal conditions, with no official closures announced, Orlando International Airport has confirmed a halt in commercial operations starting Wednesday morning. Tampa International Airport plans to suspend operations earlier on Tuesday morning. With the National Hurricane Center (NHC) upgrading Hurricane Milton to a Category 5 storm, the strongest classification, with projected landfall along Florida’s Gulf Coast, further disruptions to Disney’s operations appear likely.
Historically, Disney parks have been closed for one to two days during major hurricanes. For instance, both Hurricane Dorian (2019) and Hurricane Ian resulted in brief closures of Walt Disney World, leading to minimal longer-term damage but substantial short-term attendance disruptions. Despite the anticipated short-term challenges, Goldman Sachs remains optimistic about the company’s long-term financial outlook. The investment bank has revised its fiscal 2025 earnings per share (EPS) estimate to $5.14, down slightly from the previous estimate of $5.22, mainly accounting for the anticipated impacts of Hurricane Milton. This new EPS projection aligns with market expectations, with the consensus at $5.13.
Despite the short-term challenges posed by Hurricane Milton, Ng’s report maintains a steady outlook for Disney’s financial performance in fiscal 2026 and 2027. The EPS forecasts for 2026 and 2027 remain unchanged at $5.96 and $7.10, respectively, reflecting confidence in Disney’s Parks & Experiences segment. Goldman Sachs maintains a Buy rating on shares of Walt Disney Co. with a 12-month price target of $120, implying a 30% surge from current levels.
