Borrowings

12 Months Ended

Oct. 01, 2022

Debt Disclosure [Abstract]

Borrowings

Borrowings

The Company’s borrowings, including the impact of interest rate and cross-currency swaps, are summarized as follows:

					October 1, 2022
	Oct. 1, 2022		Oct. 2, 2021		Stated Interest Rate(1)	Pay Floating Interest rate and Cross- Currency Swaps(2)			Effective Interest Rate(3)	Swap Maturities
Commercial paper	$	1,662	$	1,992	—		$	—	3.31%
U.S. dollar denominated notes(4)	45,091		49,090		4.03%		12,625		4.07%	2023-2031
Foreign currency denominated debt	1,844		2,011		2.92%		1,847		3.42%	2025-2027
Other(5)	(1,653)		(18)				—
	46,944		53,075		3.85%		14,472		4.02%
Asia Theme Parks borrowings	1,425		1,331		2.35%		—		6.11%
Total borrowings	48,369		54,406		3.94%		14,472		4.08%
Less current portion	3,070		5,866		3.65%		1,000		3.85%
Total long-term borrowings	$	45,299	$	48,540			$	13,472

(1)The stated interest rate represents the weighted-average coupon rate for each category of borrowings. For floating-rate borrowings, interest rates are the rates in effect at October 1, 2022; these rates are not necessarily an indication of future interest rates.

(2)Amounts represent notional values of interest rate and cross-currency swaps outstanding as of October 1, 2022.

(3)The effective interest rate includes the impact of existing and terminated interest rate and cross-currency swaps, purchase accounting adjustments and debt issuance premiums, discounts and costs.

(4)Includes net debt issuance discounts, costs and purchase accounting adjustments totaling a net premium of $1.9 billion and $2.1 billion at October 1, 2022 and October 2, 2021, respectively.

(5)Includes market value adjustments for debt with qualifying hedges, which reduces borrowings by $1.7 billion and $0.1 billion at October 1, 2022 and October 2, 2021, respectively.

Commercial Paper

At October 1, 2022, the Company’s bank facilities, which are with a syndicate of lenders and support our commercial paper borrowings, were as follows:

	Committed Capacity		Capacity Used		Unused Capacity
Facility expiring March 2023	$	5,250	$	—	$	5,250
Facility expiring March 2025	3,000		—		3,000
Facility expiring March 2027	4,000		—		4,000
Total	$	12,250	$	—	$	12,250

These facilities allow for borrowings at SOFR-based rates plus a fixed spread that varies with the Company’s debt ratings assigned by Moody’s Investors Service and Standard & Poor’s ranging from 0.755% to 1.225%. The bank facilities contain only one financial covenant, relating to interest coverage of three times earnings before interest, taxes, depreciation and amortization, including both intangible amortization and amortization of our film and television production and programming costs. On October 1, 2022, the Company met this covenant by a significant margin. The bank facilities specifically exclude certain entities, including the Asia Theme Parks, from any representations, covenants or events of default. The Company also has the ability to issue up to $500 million of letters of credit under the facility expiring in March 2027, which if utilized, reduces available borrowings under this facility. As of October 1, 2022, the Company has $1.9 billion of outstanding letters of credit, of which none were issued under this facility.

Commercial paper activity is as follows:

	Commercial paper with original maturities less than three months, net(1)		Commercial paper with original maturities greater than three months		Total
Balance at Oct. 3, 2020	$	—	$	2,023	$	2,023
Additions	—		2,221		2,221
Payments	—		(2,247)		(2,247)
Other Activity	—		(5)		(5)
Balance at Oct. 2, 2021	$	—	$	1,992	$	1,992
Additions	50		2,417		2,467
Payments	—		(2,801)		(2,801)
Other Activity	—		4		4
Balance at Oct. 1, 2022	$	50	$	1,612	$	1,662

(1)Borrowings and reductions of borrowings are reported net.

U.S. Dollar Denominated Notes

At October 1, 2022, the Company had $45.1 billion of fixed rate U.S. dollar denominated notes with maturities ranging from 1 to 74 years and stated interest rates that range from 1.75% to 9.50%.

Foreign Currency Denominated Debt

Prior to fiscal 2020, the Company issued Canadian $1.3 billion ($0.9 billion) of fixed rate senior notes, which bear interest at 2.76% and mature in October 2024. The Company also entered into pay-floating interest rate and cross currency swaps that effectively convert the borrowing to a variable-rate U.S. dollar denominated borrowing indexed to LIBOR.

In fiscal 2020, the Company issued Canadian $1.3 billion ($0.9 billion) of fixed rate senior notes, which bear interest at 3.057% and mature in March 2027. The Company also entered into pay-floating interest rate and cross currency swaps that effectively convert the borrowing to a variable-rate U.S. dollar denominated borrowing indexed to LIBOR.

Cruise Ship Credit Facilities

The Company has credit facilities to finance up to 80% of the contract price of two new cruise ships, which are scheduled to be delivered in fiscal 2025 and fiscal 2026. Under the facilities, $1.1 billion is available beginning in August 2023 and $1.1 billion is available beginning in August 2024. Each tranche of financing may be utilized for a period of 18 months from the initial availability date. If utilized, the interest rates will be fixed at 3.80% and 3.74%, respectively, and the loan and interest

will be payable semi-annually over a 12-year period from the borrowing date. Early repayment is permitted subject to cancellation fees.

Asia Theme Parks Borrowings

HKSAR provided Hong Kong Disneyland Resort with loans totaling HK $0.8 billion ($102 million). The interest rate is three month HIBOR plus 2%, and the maturity date is September 2025.

Shendi has provided Shanghai Disney Resort with loans totaling 8.3 billion yuan (approximately $1.2 billion) bearing interest at rates up to 8% and maturing in 2036, with early repayment permitted. Shendi has also provided Shanghai Disney Resort with a 2.6 billion yuan (approximately $0.4 billion) line of credit bearing interest at 8%. As of October 1, 2022 the total amount outstanding under the line of credit was 1.2 billion yuan (approximately $162 million).

Maturities

The following table provides total borrowings, excluding market value adjustments and debt issuance premiums, discounts and costs, by scheduled maturity date as of October 1, 2022. The table also provides the estimated interest payments on these borrowings as of October 1, 2022 although actual future payments will differ for floating-rate borrowings:

	Borrowings
Fiscal Year:	Before  Asia Theme Parks Consolidation		Asia  Theme Parks		Total Borrowings		Interest(1)		Total Borrowings and Interest
2023	$	2,918	$	162	$	3,080	$	1,811	$	4,891
2024	2,872		—		2,872		1,748		4,620
2025	3,604		102		3,706		1,631		5,337
2026	4,578		—		4,578		1,533		6,111
2027	2,905		—		2,905		1,428		4,333
Thereafter	29,881		1,161		31,042		19,738		50,780
	$	46,758	$	1,425	$	48,183	$	27,889	$	76,072

(1) In 2023, the Company has the ability to call a debt instrument prior to its scheduled maturity, which if exercised by the Company would reduce future interest payments by $1.1 billion.

Interest

The Company capitalizes interest on assets constructed for its parks and resorts and on certain film and television productions. In fiscal 2022, 2021 and 2020, total interest capitalized was $261 million, $187 million and $157 million, respectively. Interest expense, net of capitalized interest, for fiscal 2022, 2021 and 2020 was $1,549 million, $1,546 million and $1,647 million, respectively.