It's been 24 years since a major theme park has opened in the U.S., so Thursday's official grand opening of Comcast's (NASDAQ: CMCSA) Epic Universe is a pretty big deal for the gated attractions industry. After more than a month of highs and lows during paid guest previews, Comcast was ready for its national -- and international -- close-up.
Epic Universe got off to an encouraging start on Thursday morning. All 11 rides were running an hour into the opening, a rarity for anyone who visited during the previous weeks of technical rehearsals. Outside of a five-hour wait for the signature Harry Potter and the Battle at the Ministry attraction, the remaining experiences had wait times of 30 minutes or less. An hour later, the buggy Battle at the Ministry ride was down, and the queue was not accepting new guests until the delay had passed.
A lot of time and money has gone into the park that was originally announced to open in 2023, and the theme park enthusiast community and investors have been trying to figure out if this would boost Comcast's prospects or diminish Walt Disney's (NYSE: DIS) dominance in this space.
In short, Thursday's refreshingly successful opening shows that Comcast's Universal Orlando resort is ready to become a larger force in the theme park market. It doesn't mean Disney has to lose in the process.
I saw the park at its best, a day of light crowds and ideal weather, when it closed three hours early for a private event. I also saw it at its worst, dealing with the downtime and ride glitches that will get better over time, but also the lack of shade and plethora of stairs that will only get worse for guests as we dig deeper into summer. I was also there for the first day that experienced a weather delay for paid guests, a problem in Florida, since it shut down all but three rides for more than two hours.
Despite the negatives, I was blown away by the positives. It's not just about the three bar-raising signature ride experiences. The rest of the industry will have to take note of how immersive and detailed and just flat-out gorgeous Epic Universe can be. This summer will be brutal between the heat and perpetual afternoon thunderstorms, but when the weather turns in late autumn, it will be a hard place to resist.
Image source: Getty Images.
I am happy to be both a Comcast and Disney shareholder. Epic Universe will bring no shortage of visitors to the Orlando area, but the capacity constraints of the new park will find guests checking out other area attractions until it builds out more high-capacity attractions. It's a process that will take years to fully flesh out.
Comcast will be the biggest beneficiary, naturally. The older Universal Orlando parks will gladly take Epic Universe visitors on days when a visit to the shiny new park isn't optimal. Disney could also experience an uptick in traffic if the overall tourist counts to the area spike in the next few quarters.
Comcast can use the boost. Its theme parks business reported a 5% dip in revenue and a 32% slide in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in the first quarter of this year. Disney held up considerably better in the same first three months of this year. Its stateside parks and experiences segment posted a 9% jump in revenue and a 13% increase in operating profit.
As I file this piece -- three hours into the first day of Epic Universe's grand opening -- Harry Potter and the Battle at the Ministry is still down. Folks who got in bracing for a 300-minute wait will have to tough it out a bit longer, or abandon the queue and take advantage of the still reasonably short wait times of 45 minutes or less for the rest of the rides. It's too beautiful a park to be stuck in one confined space for longer than anyone should have to, but that's just another reason why both Comcast and Disney are winners on this historic day.
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Rick Munarriz has positions in Comcast and Walt Disney. The Motley Fool has positions in and recommends Walt Disney. The Motley Fool recommends Comcast. The Motley Fool has a disclosure policy.
