The company’s sixth ship, the Disney Treasure, will take its maiden voyage on Dec. 21, and seven additional ships are expected to launch by 2031. The ships, part of Disney’s experiences segment, which also includes its theme parks business, represent a key area of growth that’s rapidly expanded in recent years.
Prior to the Treasure, Disney unveiled its sister ship, the Disney Wish, in 2022 after a decade of no new announcements. But with two ships setting sail in late 2025 — the Disney Destiny and the Disney Adventure — and five additional vessels to follow over the next six years, Wall Street analysts say it’s time to start paying attention.
“We think that these businesses have a higher return on invested capital than your average non-Disney cruise business,” Morgan Stanley analyst Ben Swinburne told Yahoo Finance, citing high occupancy levels and high revenue-per-room rates given most guests on the cruise ships are families.
The Disney Treasure can carry 4,000 passengers and 1,555 crew members. Prices for the maiden voyage start at $8,511 per person. All rooms are currently sold out online.
“That’s obviously a recipe for a very profitable investment,” Swinburne continued. “We think it’s a positive for the company that they’re investing to grow this business.”
In an interview with ABC’s “Good Morning America” last week, Disney CEO Bob Iger noted the Treasure recreates rides, characters, and storylines from Disney’s theme parks, as more consumers opt for the mostly all-inclusive cruise ship vacation in place of the often pricier stay at the parks.
Investors have recently grown concerned over a potential slowdown in Disney’s theme parks business as prices rise and demand wanes. But Disney CFO Hugh Johnston said earlier this month that operating income within the experiences division — which includes parks, cruise ships, and consumer products — is expected to rebound next year, with growth estimated between 6% and 8%.
He specifically cited the launch of the Treasure ship as a catalyst for that growth.
In a separate note to clients last month, Swinburne estimated cruise capacity will increase from 5,500 staterooms today to over 10,000 by 2026, “positioning Disney cruise revenues to more than double” between the end of this year and the end of 2027.
Cruising for growth? A view from Pier 60 of the Disney Drone Light Show celebrating the christening of the Disney Treasure cruise ship on Nov. 19, 2024 in New York City. (Photo by Craig T Fruchtman/Getty Images) ·Craig T Fruchtman via Getty Images
“While still relatively modest in size when compared to the overall US parks business and even smaller relative to the experiences segment, this business is not insignificant in terms of contributions to growth and margins,” the analyst said.
As the chart below shows, cruise revenues are expected to increase as a percentage of the US-based experiences segment, according to Morgan Stanley’s estimates. The firm projects cruises will pull in the majority of US revenue growth for the segment in 2026, with two ships set to launch in late 2025.
In addition to revenue growth, operating margins, a key measure of profitability, are also expected to increase.
Per the Morgan Stanley team, the Magical Cruise disclosure showed operating income margins running at a sizable 20% to 25% for the cruise business prior to the pandemic.
Although margins have yet to recover to those high levels, likely due to start-up costs related to the fleet’s expansion and continued recovery of the cruise industry at large, the analyst team noted that “both Disney’s historical cruise margins and public cruise comps indicate an opportunity for meaningful operating income contribution ahead.”
Ultimately, Swinburne told Yahoo Finance that investors have grown more curious about the trajectory of cruises over the last year, especially as it relates to Disney’s future earnings potential.
The analyst compared the cruise ship business to other growth areas for Disney: In 2032, the year the cruise ship build-out is expected to be complete, Morgan Stanley estimates cruises will pull in about $9 billion in revenue and yield roughly $2.3 billion in operating income. Meanwhile, Disney’s sports segment, which includes its flagship ESPN network, just reported revenue of $17.6 billion and operating income of $2.4 billion for the full year ending Sept. 28.
In other words, cruises — at roughly half the size of Disney’s sports segment in terms of revenue — are projected to eventually generate about the same amount of earnings the sports division reported this year.
“The cruise ships play a very important role,” Swinburne said. “For those of us focused on growth and the company’s ability to deliver or outperform expectations, understanding the timing of cruise launches and the earnings contribution of launches is actually very important. And it’s very important to the stock.”
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com.
