- Underperformance in Fiscal 2025 Revenue fell 3.6% YoY to $1.66 billion, with attendance dropping 1.8% to 21.2 million guests, driven by uneven consumer demand and international tourism challenges.
- Record In-Park Spending Despite lower attendance, in-park per capita spending increased 2.1% in Q4 2025, reflecting strong visitor engagement and higher average spend per guest.
- Share Buybacks and Liquidity The company repurchased 6.7 million shares (12% of outstanding) in 2025 and maintained $789 million in liquidity with a net leverage ratio of 3.4x.
- 2026 Growth Momentum Advanced bookings for Discovery Cove rose high single digits, while group bookings are up over 50%, signaling optimism for next year’s financial performance.
- Strategic CapEx and Sponsorships $217.5 million in 2025 CapEx was allocated, with $175 million planned for 2026 core projects and a sponsorship pipeline growing toward $30 million annually.
Operational Performance
The company's operational performance was impacted by lower international visitation and fewer operating days compared to the fourth quarter of 2024. Attendance decreased by approximately 126,000 guests or 2.6%, while operating expenses decreased $1.8 million or 1.0% compared to the fourth quarter of 2024. The company's pass base was down approximately 4% in December 2025 compared to December 2024, but sales momentum is improving heading into the peak selling season.
Growth Prospects
Looking ahead to 2026, the company has a promising outlook, with Discovery Cove advanced booking revenue up high single digits, and company-wide group booking revenue pacing up over 50%. The sponsorship business is viewed as a $30 million-plus revenue opportunity in the coming years. The company is investing in its parks, including SeaWorld Orlando, Discovery Cove, and Aquatica, and is confident in its long-term strategy, which will drive improved operating and financial results and long-term value for stakeholders.
Valuation
With a P/E Ratio of 11.38 and an EV/EBITDA of 3.52, the company's valuation appears reasonable. The company's Free Cash Flow Yield is 13.28%, indicating a potentially attractive return for investors. However, the ROIC and ROE metrics are negative, likely due to accounting treatments. Analysts estimate next year's revenue growth at 2.5%, which is relatively modest. The company's strong balance sheet, with a net total leverage ratio of 3.4x and approximately $789 million of total available liquidity, provides a solid foundation for future growth.
Share Repurchase and Capital Allocation
The company repurchased 6.7 million shares in 2025, representing approximately 12% of shares outstanding. The company's capital allocation strategy appears to be focused on returning value to shareholders, and the company's confidence in its business is reflected in its share repurchase activity. The company believes its shares are undervalued, trading at a fraction of its replacement value.