United Parks & Resorts Inc.

and welcome to the United Parks and Resorts third quarter earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Matthew Stroud of Investor Relations. Please go ahead.

Thank you, and good morning, everyone. Welcome to United Parks and Resorts' third quarter earnings conference call. Today's call is being webcast and recorded. A press release was issued this morning and is available on our Investor Relations website at www.unitedparksinvestors.com. Replay information for this call can be found in the press release and will be available on our website following the call. Joining me this morning are Mark Swanson, Chief Executive Officer, and Jim Forrester, incoming Interim Chief Financial Officer and Treasurer. This morning, we will review our third quarter financial results, and then we will open the call for your questions. Before we begin, I would like to remind everyone that our comments today will contain forward-looking statements within the meaning of the Federal Security Laws. These statements are subject to a number of risks and uncertainties that could cause actual results to be materially different from those forward-looking statements, including those identified in the risk factor section of our annual report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. These risk factors may be updated from time to time and will be included in our filings with the SEC that are available on our website. We undertake no obligation to update any forward-looking statements. In addition, on the call, we may reference non-GAAP financial measures and other financial metrics such as adjusted EBITDA and free cash flow. More information regarding our forward-looking statements and reconciliations of non-GAAP measures to the most comparable GAAP measure is included in our earnings release available on our website and can be also found in our filings with the SEC. Now, I would like to turn the call over to our Chief Executive Officer, Mark Swanson. Mark?

Thank you, Matthew. Good morning, everyone, and thank you for joining us. We're obviously not happy with the results we delivered in the quarter. Performance during the quarter was negatively impacted by an unfavorable calendar shift, poor weather during peak holiday periods, a decline in international visitation, and less than optimal execution. The consumer environment in the United States appears to be inconsistent as has been outlined by a number of other leisure and hospitality businesses. Nonetheless, we can and expect to do better. Attendance in the third quarter was negatively impacted by approximately 150,000 visits from unfavorable calendar impacts, particularly the timing of the Fourth of July holiday, and was also impacted by poor weather over peak Fourth of July and Labor Day weekends. We saw a decline in international visitation of approximately 90,000 guests during the quarter, which was a reversal of earlier trends we saw in the first half of the year. Adjusting for these calendar shifts and the international visitation declines, attendance would have been roughly flat for the quarter. On the positive side, we were pleased to report growth in in-part per capita spending, which has grown in 20 of the last 22 quarters. Our Halloween events just concluded last week, and we saw meaningful year-over-year growth from our separately ticketed Hallow's Scream events including record attendance in Orlando and San Diego for these events. Looking forward, we are encouraged by the forward-looking revenue trends into 2026 for our Discovery Co. property and our group business, both of which are up over 20% compared to the same time last year. We are also happy to report that our attendance at SeaWorld Orlando is up year-to-date. We are also pleased that during the third quarter, stockholders granted authority to the Board of Directors to approve and implement additional share repurchases. The Board previously announced a $500 million share repurchase program contingent on receiving this approval, and we have already repurchased 635,020 shares for an aggregate total of $32.2 million through November 4, 2025. Underscoring our strong balance sheet, significant free cash flow generation, and our strong belief that our shares are materially undervalued. Later this month, we will begin our award-winning Christmas events at our SeaWorld, Busch Gardens, and Sesame Place Langhorne parks. This year, we believe our Christmas events will be our best ever. With the popular rides, attractions, and exhibits our guests have come to expect, plus additional new and exciting events, specialty food and beverage offerings, and holiday shopping for everyone. I want to thank our ambassadors for their dedication and efforts during our busy summer season and as well during our Halloween events and upcoming Christmas events. As we move into 2026 and beyond, we firmly recognize their significant opportunity to execute better and drive meaningfully more attendance to our parks, grow total per capita spending, and continue to reduce costs and find efficiencies. While this year has been disappointing to date, we have high confidence in our ability to deliver operational and financial improvements that will lead to meaningful increases in EBITDA, free cash flow, and shareholder value. We are focused, well-positioned, and confident in the investments we are making, the operational efficiencies we expect to achieve, and the value we plan to build for stakeholders. We have announced several of the upcoming new rides, attractions, and events and upgrades for 2026. This includes the following. SeaWorld Orlando is pushing the boundaries of family thrills once again with its new attraction, SeaQuest Legends of the Deep. Guests will embark on a vibrant, submersible adventure through dazzling undersea ecosystems where they'll encounter extraordinary life forms, breathtaking environments, and inspiring stories of the sea. This groundbreaking attraction plunges explorers into an environment of awe and mystery guided by the SeaWorld Adventure team. SeaWorld San Diego is creating a reimagined and immersion version of the Shark Encounter, which will debut in the spring of 2026. SeaWorld San Antonio is making waves once again with an all-new thrill ride, Barracuda Strike, Texas' first inverted family coaster. The one-of-a-kind attraction invites guests of all ages to dive into the deep and experience the ocean's most agile predator like never before. With every twist, drop, and tight turn, Barracuda Strike will deliver a rush of excitement that's bold enough for thrill-seekers, yet built for the whole family. Suspended beneath the track, riders will glide above the park's iconic water ski lakes in a high-speed pursuit that captures the speed, power, and precision of the Barracuda. Busch Gardens Tampa Bay is roaring into 2026 with an all-new Lion and Hyena Ridge, an extraordinary new addition to the park's award-winning animal care portfolio and a most ambitious new habitat in more than a decade. This reimagined area of the park expands the existing space to more than double its previous size, creating nearly 35,000 square feet of dynamic savanna terrain where two of Africa's most iconic species will thrive, a pride of five young male lions, and a pair of playful hyenas. Busch Gardens Williamsburg will be announcing their upcoming attraction later this week. Our balance sheet continues to be strong. On September 30, 2025, net total leverage ratio was 3.2 times, and we had approximately $872 million of total available liquidity and approximately $21 million of cash on hand, including restricted cash. This strong balance sheet gives us flexibility to continue to invest in and grow our business and to opportunistically allocate capital with the goal to maximize long-term value for shareholders. I'm disappointed in our management of costs during the quarter. We have made changes to address our execution issues in this area and have implemented new processes and initiatives to address cost opportunities across the enterprise. Moving on to an update on select strategic initiatives. On the sponsorship front, we have made good progress on several partnerships that we expect to announce in the coming months. As a reminder, we have over 21 million annual visitors across our park portfolio, and the average length to stay is over six hours. We continue to expect approximately $20 million in annual sponsorship revenue in the coming years. On our international opportunities, we are in active discussions with multiple potential partners. We signed one MOU during the quarter with an international partner and have since entered a development advisory agreement and have begun concept development work. We expect to sign at least one additional MOU in the coming months. In regards to the mobile app, we continue to make progress on functionality, adoption, usage, and financial impact. The app is being used by an increasing number of guests in our parks to improve their in-park performance. The app has now been downloaded more than 16.8 million times, up from 15.6 million at the end of Q2. Total revenue generated on the app continues to grow, and we are now seeing an approximate 37% increase in average transaction value for food and beverage purchases made through the app compared to point of sale orders. We are excited about the potential of the app and its ability to improve the in-park guest experience, drive increases in revenue, and decreases in cost. On real estate, we continue to discuss alternatives with potential partners and have recently received specific proposals that we are actively evaluating. As we have discussed, we own over 2,000 acres of valuable real estate in desirable locations including approximately 400 acres of undeveloped land adjacent to our parks, including significant developable land in Orlando. We do not believe that the public markets have or are appropriately giving credit to these attractive and valuable 100% owned real estate assets. I'm excited about the significant investments we are making and the many initiatives we have underway across our business that we expect will improve the guest experience allow us to generate more revenue and make us a more efficient and more profitable enterprise. We are building an even stronger and more resilient business that we are confident over time will deliver improved operational financial results and meaningful increases in value for all stakeholders. With that, Jim will discuss our financial results in more detail.

Jim? Thank you, Mark, and good morning. During the third quarter, we generated total revenue of $511.9 million, a decrease of $34.1 million, or 6.2%, when compared to the third quarter of 2024. The decrease in total revenue was primarily a result of decreases in attendance and admissions per capita, partially offset by an increase in in-park per capita spending. Attendance for the third quarter of 2025 decreased by approximately 240,000 guests, or 3.4%, when compared to the prior year quarter. The decrease in attendance was primarily due to an unfavorable calendar shift, including the timing of the 4th of July holiday, and a decrease in an international visitation compared to the prior quarter. In the third quarter of 2025, total revenue per capita decreased 2.9%. Admission per capita decreased 6.3%, and in-park per capita spending increased 1.1%. Total revenue per capita lowered due to decreases in admissions per capita, partially offset by increases in in-part per capita spending. Operating expenses increased $7.1 million, or 3.4%, when compared to the third quarter of 2024. Selling, general, and administrative expenses increased $5.3 million, or 9.6%, compared to the third quarter of 2024. We reported net income of $89.3 million for the third quarter compared to net income of $119.7 million in the third quarter of 2024. We generated adjusted EBITDA of $216.3 million in the quarter. Looking at our results for the three quarters of 2025 compared to 2024, total revenue was $1.29 billion, a decrease of $51.9 million, or 3.9%. Total attendance was 16.4 million guests, a decrease of approximately 252,000 guests, or 1.5 percent. That income for the period was $153.3 million, and adjusted EBITDA was $490 million. Now turning to our balance sheet. As Mark mentioned, our September 30, 2025 net total leverage ratio is 3.2 times, and we had approximately $872 million of total available liquidity. We have approximately $221 million of cash on hand, including restricted cash. The strong balance sheet gives us flexibility to continue to invest in and grow our business and to opportunistically allocate capital with the goal to maximize long-term value for shareholders. Our deferred revenue balance as of the end of September was $145.5 million. Through October 2025, our pass base, including all past products, was down approximately 4% compared to October 2024. We have launched our 2026 PASS program, which includes our best-ever PASS benefits program. We're excited about our new 2026 PASS program and expect to see improvement in growth in our PASS base as we progress into next year. We started our Black Friday sale earlier this week. It's one of our bigger selling periods for the year, and we're encouraged with the preliminary results so far. Finally, as of September 30th, 2025, year to date, we have invested $167.2 million in CapEx, of which approximately $142.2 million was on core CapEx, and approximately $25 million was on expansion or ROI projects. For 2025, we expect to spend approximately $175 to $200 million on core CapEx, and approximately $50 million of CapEx on growth and ROI projects. Now, let me turn the call back over to Mark. who will share some final thoughts.

Mark? Thank you, Jim. Before we open the call to your questions, I have some closing comments. In the third quarter of 2025, we came to the aid of 192 animals in need. Over our history, we have helped over 42,000 animals, including bottlenose dolphins, manatees, sea lions, seals, sea turtles, sharks, birds, and more. I'm really proud of the team's hard work and their continued dedication to these important rescue efforts. I'm excited about the opportunity set in front of us, both in the near term, where we see clear paths to drive meaningful progress, and over the medium term, where the growth potential is greater. We're focused, well-positioned, and confident in the investments we are making, the operational efficiencies we are realizing, and the value we are building for stakeholders. Now let's take the questions.

We'll now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. Our first question comes from Steve Wisniewski with Stifel.

Yeah, hey guys, good morning. So Mark, if we go back to your last call, which was early August, I think you noted then that attendance was up on a day-to-day basis through early August. So I'm just wondering maybe what happened from early August through the end of the quarter because you know, that would kind of tell me that, you know, you witnessed somewhere, you know, low to mid single digit declines for the rest of the quarter. And this was also off of a, you know, an easier comp since the third quarter of 24, I think you had a weather headwind of somewhere around 300,000 guests or somewhere in that range. So, you know, maybe just trying to figure out, you know, what kind of happened through, you know, through August and September.

Yeah. Hey, Steve, I can help you with that. So look, August, August is where we started to see, I should say, we expected to get more of the weather recovery. We got some early in the month, early on, and then we did not get as much as we expected over Labor Day and obviously into September. You also had the international attendance impact in there as well, and that you know, was there in July as well, but obviously there in August and more pronounced in September and here into October. And I think that's been pretty well reported, you know, that we view that as more of a macro issue, and I'm sure there's things we can be doing better too, but more of a macro issue. You also have at, you know, kind of the end of the quarter, and this is just a function of how we report our results, we report at the end of the month, regardless of what day a week it is. So if you kind of go back and look at the days in the quarter, right there, kind of at the end of the month, you have a negative calendar shift that happens. And that's just unique to us. Some of that, we will get some benefit of that back in Q4. But that was another pretty meaningful impact in the quarter, obviously.

Okay, gotcha. Thanks for that. And then second question, Mark, you noted the, you know, in your words, the consumer is inconsistent. And just maybe you want to understand what that means a little bit more. And then, you know, maybe if you can kind of touch on as well the impact from, you know, or lack of impact from Epic through the summer and into the fall so far. Thanks. Sure.

So I'll take your second one first. So On Epic, I mean, you heard me say in the prepared remarks that year-to-date attendance is up at SeaWorld Orlando. I'm not going to really comment much beyond that, obviously. But the thesis hasn't changed. We still view the Epic opportunity as a very good opportunity. We welcome investment into the market. We think it benefits the market in general. And obviously, you know, we can share and in that market improvement, if you will. And that's evidenced by more than 50 years of being in Orlando and continuing to grow and adding our own additional parks and things like that. So that has not changed. Obviously, it's going to ebb and flow from quarter to quarter, I'm sure. And they're going to do things, and we're going to do things. Others in the market are going to do things. But I think we're going to continue to optimize and learn and take advantage of what will be more people coming to the market, obviously. As far as the consumer, you know, I said last quarter, you know, what I look at a lot of times is the in-park spend, and our in-park spend was up in this quarter. So people are, you know, at least in our park, you know, the in-park spend is growing. We recognize that there's a lot of companies talking about the consumer and the health of the consumer. So, you know, it's hard for us to pinpoint, you know, if it's having a significant impact on us, but we're not, you know, we're not ignoring that. Obviously a lot of people are talking about it. So I'm sure there is some, some impact to certain guests across our portfolio. It's just really hard for us to tell. And like I said, we see our per cap on an impact basis up in the quarter. And I can tell you it was up, up again in October. So that's kind of the commentary there. It's just a little bit mixed. We're going to continue to move forward on our end. And like I said, the things we got to do to continue to drive our results. And we know there could be some challenges with consumers, obviously. But at least from where we sit, looking at our end part per capita, which is the one thing I do look at, That is positive in the third quarter and positive in October as well. Steve, I'll add, sorry, just one quick thing to add to that. I kind of mentioned it, but, you know, if you do look at our pass space, we know that's been, you know, down. And, look, I'm sure some of the peak selling seasons for our passes were around when the tariff noise was happening. I said this last quarter. It's hard to know if that had an impact on us. I'm sure it didn't help us is, I think, what we're trying to say. And so, you know, we have opportunities to close that gap, and I can talk to you more about that, I'm sure, a little later.

Our next question comes from Artane Kasharian with UBS.

Hi. Thank you for taking my question. I have a couple of quick ones. First, what do you think drove the reversal in international visitation you were seeing in the first six months of the year? It seems like you're saying it's not Orlando. What do you think drove that? And then I have a quick follow-up.

I think if you're asking specifically about international attendance, I mean, we saw it up in the second quarter and then, you know, obviously a decline in the third quarter. And I know I think Visit Orlando has put out some projections that it's going to be to the market in Orlando for the year. And so I think it's more macro factors. Obviously, there's always things we can do better, but I think this one is pretty well understood on the macro side that international visitation to the United States is slowing, and we see that mentioned I think some of you guys even mentioned that in some of your reports this morning.

Okay, and you don't see that tied to some of the immigration stuff and harder to get visas and whatnot versus macro?

No, all those things you said I'm sure are factors. That's what I'm saying. I think they're more macro factors that aren't necessarily in our control. So whether it's visas or immigration costs, whatever it may be, that's what I'm saying. I think all those things are a drag for just the international visitation in general.

Our next question comes from Thomas Yee with Morgan Stanley.

Thanks so much. Yeah, I just wanted to follow up a little bit more on that Orlando market comment. Can you maybe just flesh out what you're seeing at the regional level a little bit more? You did cite SeaWorld Orlando attendance up year to date, and I would have imagined most of the international visitation headwind you cite stems from that market. Is that fair? And if so, then were the other markets kind of underperforming even relative to that?

Yeah, hey, Thomas. I think you can, as we've said in the past, assume that the international attendance is, as you noted, more of an impact to the Florida market and Orlando. So, you know, the fact that we're up year to date at SeaWorld Orlando with that headwind, you know, I think you could view that as a positive. You know, we'll see where we shake out, obviously. But, you know, your point is a valid one. On a relative basis, there's other parks that we need to see do better that are outside of the Orlando market.

Okay, that's helpful. And then for October, you cited per caps growing. How is attendance pacing, if you can comment on that, particularly given I think you're comping the Hurricane Milton issues that you were facing in early October last year?

Yeah, so on October attendance, you know, we had the hurricane recovery in Tampa, which we got a good portion of that, and to some extent here in Orlando as well. There's been a couple headwinds against that, mainly the weather in Williamsburg, which is one of our more popular Halloween parks. You guys might remember over Columbus Day, a pretty big nor'easter up the East Coast that really impacted that park and to some extent our Sesame Park in Langhorne for a number of days. And then we did have a couple of rain weekends here in Orlando. And then we have the continued international decline as well. I mean, when you net it all up, attendance was up in October, not as much as we'd like because the weather recovery was not as strong in part due to just poor weather in other places and the international decline. I will say, I think it's important to note, I said in part per cap was positive for October. Admissions per cap was also positive as well for the month. No one's asked me yet about this, but the comment I'd make around that is I think we're doing a better job of managing the emissions per caps here, you know, in October. And, you know, we'll see where that goes going forward. But that's a couple of data points for you.

Our next question comes from Chris Woronka with Deutsche Bank.

Hey, good morning, guys. Thanks for taking the questions. Mark, I guess... if you guys kind of collect feedback from guests and any surveys you do, your marketing approach, I mean, do you get the sense that you need a, you know, more strategic pivot and whether it's, you know, in part offerings or marketing approach and thinking about things like, you know, social media versus traditional, but really the gist of the question is, you know, if you're collecting feedback from customers, you know, is there something more different they want to see outside of, you know, price value situations?

Well, look, Chris, thanks for the question. I mean, when you kind of back up in the quarter and you take out the weather and the calendar shift, you know, those are things that just kind of happen. So I don't think that has to do with necessarily, you know, what we offer in the parks or anything. The international, you know, impact is a new emerging thing, and that's more macro related. So, look, there's obviously things we can do better. in our parks, and we've got to execute better on some things. But I think as far as the events and the rides and the attractions we offer are compelling, and we're going to continue to do that. We saw, like I noted, for our hollow scream event in San Diego and Orlando, record attendance for those events. And we have a good Christmas event ready to start this weekend in one of our parks and the rest of the parks later on. But one of the, I think, key things, I don't know that pivot's the right word. I think we will continue, and I think this is really important, we are going to continue to invest in our parks. We're going to continue to drive improvements in putting new attractions in, updating venues, aesthetics, all those things that have been things we've done for years. And so we're not ever going to neglect the parks or anything. We're going to make sure They're fresh and reasons to visit. So we'll continue to make that capital investment. So there's no change in that strategy. That will attract people if you give them some good reason to come and it's new and exciting and things like that. Where I think we could do a better job is obviously on the execution around that. And some of that comes down to marketing. Some of that comes down to the different ticket offers we have and whatnot. So we've got to do a better job on some of those areas, but the core of what we do to our parks, the rides, the attractions, the collection of assets still remains really strong and we'll continue to invest in those.

Okay, thanks for that Mark. As a follow up, I think you mentioned the MOU being signed internationally in third quarter and one I think you said you expect to sign soon. can you maybe give us just a little bit of an overview of the overall size of that pipeline and knowing that, you know, things may or may not happen, but you know, how big can that get over the next three, five years? And then also on the sponsorship side, you gave us kind of a run rate number you expect. And then I think in the next couple of years, same question is, is there a, is the pipeline growing there as well? Thanks.

So on the international, I think what's exciting is people continue to reach out to us. And so we talked about in our release, or in my prepared comments, the two things that we were comfortable mentioning, the two MOUs. One signed, one we expect to sign in the coming months. So I think that outreach should continue. I don't want to guide you to anything, obviously. These things can take a while to develop, but certainly, I think having people see the potential in our product, the park in Abu Dhabi, if you've not seen it, you know, go there or look online. It's a really well-done park. I mean, it just really showcases the brand well, in my opinion, and I think people see the potential of what our kind of know-how and knowledge can bring to, you know, wherever they may be located, right? And it doesn't just have to be SeaWorld. I mean, we have obviously other brands, whether it's Busch Gardens or Aquatica or even Discovery Cove. So I expect, you know, outreach will continue, but I don't have anything specific to guide you to. We'll update you each quarter. On the sponsorships, you know, similar. I mean, people recognize that we have, You know, over 20 million visitors coming to our parks on an annual basis. It's somewhat of a captive audience. And, you know, there's a lot of activation and different things we can do. And so there's a list that, you know, we're working through. And, you know, we're excited about those opportunities going forward. So I expect we'll continue to find more opportunities in that over the coming years.

Our next question comes from James Hardiman with Citigroup.

Hi, this is Sean Whitener for James. I guess you've talked somewhat about the international weakness. Are you able to break down domestic visitors? Are you seeing any differences there between destination of fly-in versus local drive-in?

Yeah, I don't know that we'll comment a whole lot on just the nuances. I mean, just, you know, a lot of our parts get visitation from closer in, right? So even here in Florida where we're sitting today, a lot of our attendance is coming from the state of Florida. And things move around from quarter to quarter. I think the most pronounced thing like we saw, which is why we called it out, was the international attendance changing.

OK. On the attendance per cap front, are you able to provide any more color on how that breaks down by park, or are you more aggressive in Orlando versus other markets, given some of the international and competitive headwinds there?

Yeah, I don't think we're going to break it down by park, but I think a couple comments since you kind of asked. I mean, obviously, you know, you have a lot of things that impact your emissions per cap. you kind of mentioned international decline. That's typically a higher per cap guest. So when that, you know, for all the reasons that were mentioned earlier, why those folks, you know, when that attendance goes down, that can have an impact on your per cap, obviously. Weather and the holiday shift as well. You can't wait around for weather to get better in a compressed summer. I think summer is in my opinion, getting more compressed. You don't have a whole lot of time. You have to react somewhat quickly. And then, you know, obviously with our path space down, you're looking to fill the gap, and there's different strategies for doing that, which, you know, we went after. We also, you know, when I talk to our revenue management team, you know, we have a little team that manages this process. You know, they see more competitive offers, if you will, more promotions from some of our competitors in several markets, right? So I think we're not the only ones, you know, or maybe so another way, we're sometimes having to react to some of those offers that other competitors are putting out in more than one of our markets. The good news, as I said, is we did see improvements in the per cap in October. And, you know, I mentioned Or I think Jim mentioned in his prepared remarks that, you know, we just launched our 2026 passes and one of the big kind of acquisition periods is around Black Friday. And that's kind of our first kind of, you know, big time of the year where we start to acquire passes for the following year. And so that That sale has just started this week. It's very early, but obviously we're encouraged by the trends, as Jim said, that we see there. We know it's very important that we close that gap, and early on here we're encouraged. Still a long way to go, and still that gap can live with you for a little while because it's a yearly path. So that'll start to cycle through as we go into next year. in the spring and summer of next year and hopefully become more of a tailwind for us. And I'm not going to give you specific what we did, but obviously we've done a few things differently with some of our past products that we think are going to be compelling to guests. And we continue to have very good benefits as well. And I think most importantly, to give you a really long-winded answer, is the key thing you need, one of the key things you need, for a strong PASS program is to have reasons to visit. And I said this already, but we have another exciting lineup of new things coming to our parks next year, whether it's attractions, rides, events, refreshed venues, that type of thing. That you fundamentally need to have, I think, most years to continue to have PASS members visit. continue to also give them reasons to come. The second thing would be continue to give them a compelling value proposition. Our passes are among, I think, one of the best values you can buy for entertainment for your family and friends and things like that if you look at the kind of the value you get in a season pass for coming to our park. So the investments in the product is there. The value proposition is there. we have to do a better job of driving the awareness around those past products, how we're marketing those products, and how we're driving people to buy that product.

Our next question comes from Lizzie Dove with Goldman Sachs.

Hi, Deb. Thanks for taking the question. I guess just to go, like, big a picture for a second, it feels like as an industry, and for you guys, like, attendance isn't back to 2019 levels, and you know, for you guys not back to the peak levels either that you've kind of laid out in the past, like what do you think is the kind of gating factor to growing attendance longer term? Like, is it something structural, more competition, you know, maybe not even from other parks, but just other kind of in-home out of home entertainment, or how do you kind of think about that forward trajectory?

Hey, Rosie. So look, I still have a lot of confidence in, in the industry as a whole. It's a good industry, and there's a lot of, you know, I kind of mentioned on the last question about the value proposition and things of going to a theme park, and I think we line up very nicely with that, and we're continuing to make the investments in the product, which I think is really important to do that, and we'll continue to do that. You know, in our case, we've not had the best weather over the last several years here, We know there's a lot of competition for people's time more than ever. And I think we've got to continue to kind of break through on the awareness and why, you know, you should have a ticket or a pass to our park. We sometimes talk about, like, you know, if you moved into town, you know, if you moved into Tampa and you were a new resident, like, It should almost be like your neighbor should be telling you, like, hey, you've got to get a pass to Busch Gardens. It's a great value. Everybody has a pass. So we've got to, I think, market that better, give people reasons to buy our product. And the way to do that is to continue to invest in the parks, continue to give a strong value proposition and people reasons to visit. And so I'm still real confident in not only our business, but obviously the industry as a whole.

Got it. That makes sense. And then just to kind of ask one of the other cost questions a slightly different way, but you know, you've got these kind of cost saving targets. Your margins are still higher generally than the rest of the industry. And look, I know there's nuances with footprint and operating days and all of that, but I guess it's because you maybe speak to the confidence of, you know, being able to kind of grow margins from here or whether there is some reinvestment needed, whether that's, you know, events, marketing, anything like that.

Thanks. Sure. Well, look, you, you know that we hold ourselves to a pretty high standard, and we've executed over the years, you know, I think reasonably well with some of the cost initiatives. Now, you know, obviously I said I was disappointed in the quarter with the cost saves and efficiencies, and I was. And we've got some, you know, some new efforts around kind of how we're processing some of that, how we're managing that. And, you know, I think we're going to do a better job of managing that going forward. There's obviously, as you noted, always new costs and new things that emerge, and we have to do a better job of managing those things as well. So I think the stuff that is in our cost plan we're managing, it's some of the new things that emerge that we've got to address more quickly and be more able to mitigate those as much as possible. So I don't know. I'm not going to guide you to where margins can go. Margins, you know, we're not guiding to that. But what I can say is, you know, a core kind of piece of our strategy going forward is continuing to find cost efficiencies and managing our costs. Like you said, the margins are still strong for the industry. And, you know, if you look at the The cost, you know, I call them the adjusted EBITDA cost, the difference between revenue and adjusted EBITDA. If you look at that growth, you know, this year, it's, I think, under 2%. So it's not like we're out of control or anything. We've managed to a fairly low level. But we know we can do more, and we've got to execute better on that. And, you know, we're addressing that, you know, as we speak.

Our next question comes from Patrick Scholz. with Truist.

All right. Good morning, everyone. Thank you. I got onto the call a little bit late, so I apologize if any of these have been asked already. Any initial expectations or how should we think about CapEx spend for next year? Thank you.

Yeah, so I can take that. I mean, you know, I think you would expect us to be in a similar range to where we are this year. And that, you know, it might move around slightly, but, you know, that's been our kind of target somewhere in that range. For the most part, we haven't, you know, given you anything specific. I think the key thing for you, and I know I've said this already, but we're going to continue to make investments in the parks. We're not going to suddenly change that mindset. So we'll continue to invest in the parks with capital, with resources, new events with aesthetics, whatever it may be to keep our parks fresh and reasons to visit.

Okay, thank you. And then my next question, this is sort of a high-level sort of thematic question. You know, certainly attendance in the last quarter was soft, but then you point out some really strong initial metrics for next year with Discovery Cove and group up 20%. You know, when I think about especially Discovery Cove, you know, a really high-end type of exclusive type of product. You know, would you say that, you know, in your business, you're seeing these bifurcated trends where, you know, say, Discovery Cove doing initial bookings looking really well, but then sort of, you know, last minute, more mass market attendance softer. You know, is that something that you also see in your business, this K-shaped bifurcation? Thank you. And any other questions? those types of trends that you see. Thank you.

Yeah, sure, Patrick. So I'm glad you called out Discovery Cove. And that park is on pace this year to have record attendance and revenue. And as I mentioned in my prepared remarks, the revenue trends for next year are up. The bookings and revenue for next year are up over 20% compared to the same time last year. So that's a good sign. good park and it's our most expensive park, right? So that, you know, kind of feeds into the comment about, you know, we look at that park, it's solid bookings. We look at our in-park per cap growing in the quarter and again in October. So, you know, there's, you know, are there consumers that are being impacted as part of our kind of guest mix? I'm sure there are. So I don't want to, you know, say they're not. But we see other things, like I said, like Discovery Cove and our in-park per cap that tell us, you know, there's also consumers who are fine, right? So kind of the mixed bag there, as you noted. But, you know, I think the takeaway, Discovery Cove, you know, which is in Orlando, pacing well this year, you know, to a record of attendance and revenue and looking solid for next year as well.

This concludes our question and answer session. I would like to turn the conference back over to Mark Swanson for any closing remarks.

Yeah, thank you. On behalf of Jim and the rest of the management team here at United Parks and Resorts, I want to thank you for joining us this morning. As you heard today, we're confident in our long-term strategy, which we believe will drive improved operating financial results and long-term value for stakeholders. So we thank you and look forward to speaking with you next quarter.

Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.