Merlin writes down Madame Tussauds by £262m as visitor numbers fall

Merlin Entertainments has written down the value of its Madame Tussauds business by £262 million, reflecting ongoing pressure on visitor numbers and shifting consumer behaviour across key global markets.

The impairment comes as the group, which also operates Alton Towers, Legoland and the London Eye, continues to grapple with a challenging macroeconomic environment, particularly in North America and Asia, where demand has remained subdued.

Chief executive Fiona Eastwood said the writedown was an accounting adjustment rather than a reflection of the brand’s long-term viability.

“It is still a very successful brand, it’s just recognising we’ve lost some of the volume we had in its heyday,” she said, emphasising that the move does not affect the company’s cash position.

More than any of Merlin’s other attractions, Madame Tussauds continues to feel the lingering effects of the Covid-19 pandemic. The wax museum chain, which has operated for nearly 190 years, is heavily reliant on international tourism — a segment that has yet to fully recover in key cities such as London, New York and Sydney.

This has contributed to a broader decline in footfall across the group. Merlin reported total visitor numbers of 60.5 million in 2025, down by 2.3 million compared with the previous year.

While spending per visitor increased, helping to offset some of the impact, total revenues still fell 2.8 per cent to £1.99 billion.

Performance varied significantly by region. North America was the weakest market, with underlying sales falling 8 per cent to £577 million, driven by increased competition and aggressive discounting across the attractions sector.

In Europe, revenues rose modestly by 1 per cent, although the UK lagged behind, with sales down 3.5 per cent and visitor numbers dropping 6.5 per cent. Merlin attributed this to weaker demand in London, where fewer international tourists and a shift towards free attractions have weighed on attendance.

By contrast, Asia-Pacific delivered strong growth, with visitor numbers rising 5.3 per cent and revenues increasing 4.5 per cent to £285 million. The region also saw a sharp 120 per cent increase in underlying operating profits, supported by strong performance at Legoland resorts in Japan and Shanghai.

In response to the downturn, Merlin is investing in new concepts to revitalise Madame Tussauds and attract a broader audience. Among the initiatives planned for 2026 is an immersive Jumanji-themed experience, set to launch in major locations including New York, Hollywood, Las Vegas and Sydney.

Eastwood said the strategy builds on Merlin’s track record of developing innovative attractions tied to popular culture and entertainment franchises.

“We are focused on reinvigorating the brand in line with changing consumer trends,” she said, pointing to the success of previous themed experiences across the group’s portfolio.

The writedown comes as part of a wider restructuring programme aimed at improving efficiency and profitability. Over the past year, Merlin has consolidated its operations, bringing together its three divisions, spanning 130 individual attractions, into a more streamlined structure.

The changes have already resulted in more than 1,000 job cuts and delivered £37 million in cash savings, with a further £50 million in annualised savings expected.

The company reported signs of improvement in the second half of 2025, with underlying adjusted profits rising 6.5 per cent after a weaker first half. Overall, profits grew marginally on a constant currency basis for the year.

However, the group remains in a loss-making position, posting a pre-tax loss of £426 million, albeit an improvement on the £492 million loss recorded the previous year. Net debt stands at £3.8 billion, much of which dates back to its 2019 take-private transaction.

For Merlin, the challenge now is to balance cost discipline with investment in new experiences that can reignite demand, particularly for legacy brands such as Madame Tussauds.

While the writedown reflects current market realities, the group is betting that innovation, operational efficiencies and a gradual recovery in international tourism will help restore momentum.

As consumer preferences evolve and competition intensifies, the success of that strategy will determine whether Madame Tussauds can reclaim its position as a flagship global attraction, or continue to face pressure in a rapidly changing leisure landscape.

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Merlin writes down Madame Tussauds by £262m as visitor numbers fall