Q2 2024 domestic visitation for destination theme parks was very similar to the past year: Disney gained share, visits were roughly flat year-over-year, and visitors were down -4% (likely due to consumer retrenchment, cruise vacations which offer better value, and international holidays). Universal Studios experienced the deepest decline, especially Hollywood. Florida was also down, perhaps because families are holding off until its new park Epic Universe opens in 2025. SeaWorld’s declines were driven by Busch Gardens, and that likely reflects comparisons to the COVID recovery (recall one of our major themes is “2023 was the Year of Peak Fun"). Busch Gardens are also more of a "locals" park (i.e., non-destination parks) which is a more challenged segment given the budgetary pressures on lower-income households.
That said, April was really the soft spot during the quarter, and that’s not where the money is; the key months are June, July, and August. The parks were up nicely in June, as was the case for the industry (which saw a mid-single-digits increase in attendance). Below, we show this with Six Flags and Cedar Fair as a proxy for the non-destination theme park industry. However, we've previously discussed that Six Flags and Cedar Fair are seeking to change that “locals” designation to capture market share from destination parks.
Six Flags and Cedar Fair completed their merger on July 1. We’ve written several stories about the industry and merger; principally the merger allows them more scale to invest in new attractions and technology, as well as a broader portfolio of attractions to offer membership holders. Below we show the two’s competing parks in Northern and Southern California. What strikes us is the limited shared true trade areas for the two parks: 25% for Cedar Fair (California’s Great America and Knott’s Berry Farm) in the two regions, and 28%-37% for Six Flags (Six Flags Discovery Kingdom and Six Flags Magic Mountain).
Going one layer deeper, we looked at visitors between the parks in the two regions. Here the separation is more striking. Over the past year, in Northern California, only 6.7% of Cedar Fair’s California’s Great America visitors went to the in-market Six Flags park and only 6.3% of the Six Flag’s went to California’s Great America.
In Southern California, only 8.7% Knotts Berry Farm’s visitors also visited Six Flags and only 11.0% of Six Flags Magic Mountain visitors went to Knott’s Berry Farm. Disney dominates both.
And so, if a combined Cedar Fair and Six Flags annual membership program can cut into some of Disney’s share, that can really move the needle of the newly merged entity.
