Madame Tussauds, the iconic waxwork attraction that has drawn tourists for nearly two centuries, has seen its value dramatically reduced by £262 million. Merlin Entertainments, the global operator behind the brand, has written down the asset in response to a sustained decline in visitor numbers and revenue. This move reflects broader challenges facing the tourism and entertainment sectors in a post-pandemic world.
A Historic Brand Faces Modern Struggles
Founded in 1835, Madame Tussauds was once a must-visit destination for travellers seeking photographs with lifelike wax figures of celebrities, from royalty to Hollywood stars. However, the attraction has experienced a steady downturn since the Covid-19 pandemic. Factors contributing to this decline include the cost-of-living crisis, fierce competition from new attractions, and a drop in international tourism. Fiona Eastwood, Merlin's chief executive, acknowledged the shift, stating, 'It is still a very successful brand, it's just recognising we've lost some of the volume we had in its heyday.'
Financial Impact and Corporate Restructuring
The £262 million impairment is an accounting adjustment to reflect the reduced value of the Madame Tussauds proposition on Merlin's balance sheet. Eastwood emphasised that this writedown does not impact cash flow but establishes a baseline for revitalising the brand. This comes as part of a wider decline across Merlin's attractions, which include Legoland, Alton Towers, and Chessington World of Adventures. Visitor numbers at Merlin attractions dropped from 62.8 million in 2024 to 60.5 million in 2025, a 3.6% decrease. Similarly, annual revenue fell to £1,999 million in 2025 from £2,057 million in 2024, down 1.6%.
In response, Merlin has undergone significant restructuring, consolidating three operating divisions into one group encompassing 130 separate businesses. This restructuring led to 1,000 job cuts, resulting in £37 million in cash savings, with further cost-cutting plans underway. A statement on Merlin's website explained, 'Based on current trading performance and the wider macroenvironment we applied a £262 million impairment to the accounting value of the Madame Tussauds proposition on the balance sheet. This establishes an accurate baseline from which to reinvigorate and refresh the brand's offering in line with changing consumer trends and expectations.'
Ongoing Challenges and Competitive Threats
Madame Tussauds has faced persistent struggles, particularly after the Covid-19 pandemic, and was previously given a £163 million write-down in 2024. Despite a brief rise in visitor numbers in 2024, revenues fell by 3.2% to £2 billion, and the company reported a pre-tax loss of £492 million, widening from a loss of £214 million the year before. The cost-of-living crisis has further dampened popularity across Merlin attractions, as consumers prioritise free events and exhibitions over paid experiences like Madame Tussauds, where tickets start from £27 per adult.
Analysts point to shifting cultural trends as a key factor. Greg Johnson of Shore Capital noted, '[Madame Tussauds] is a model that has felt past its shelf life for a long while. That idea of seeing famous people on what feels like a real-life basis, I don’t think that works now.' The digital age has democratised fame, reducing the 'special' status once associated with celebrities who have waxworks. Additionally, competition is intensifying, with new attractions set to open in the UK. Universal Destinations & Experiences is developing a major theme park and resort in Bedford, expected to welcome 8.5 million visitors annually, while Puy du Fou plans a £600 million history-themed attraction in Oxfordshire.
Leadership's Response and Future Outlook
Defending the writedown, Fiona Eastwood described 2025 as a transitional year for Merlin, during which the company took decisive action to stabilise the business. She stated, 'We simplified our operating model, reinforced cost discipline, established a new Growth function, and strengthened our leadership team, creating a leaner and more unified organisation.' Eastwood expressed confidence in Merlin's future, adding, 'We have turned a corner and are firmly on the path to improved profitability and sustainable growth. Merlin is now a stronger, more disciplined and more resilient business. Transformation will not be linear, but our direction is clear.'
The challenges facing Madame Tussauds underscore broader shifts in the entertainment and tourism industries, where traditional attractions must adapt to evolving consumer preferences and economic pressures. As Merlin works to refresh its iconic brand, the success of these efforts will be closely watched by investors and tourists alike.
