Key Takeaways:
- Disney shares surged after the entertainment giant reported better-than-expected results for its fiscal first quarter of 2024.
- Disney also said it’s investing $1.5 billion in Fortnite maker Epic Games, in Disney’s biggest push into video games yet.
- Disney and Epic Games will work together to create a gaming „universe” that is interconnected to the popular online game.
Disney (DIS) shares surged 6% in after-hours trading Wednesday after the entertainment giant reported better-than-expected results and said it’s investing $1.5 billion in Fortnite maker Epic Games, in its biggest push into video games yet.
The companies will work together to create a gaming „universe” that uses Disney characters and stories, according to a statement released in tandem with Disney’s earnings Wednesday. This gaming experience will be interconnected with Epic’s popular melee fighting game Fortnite.
Disney CEO Bob Iger said the company is making the move because younger generations are spending large portions of time with video games.
„We think we can turn this into a good solid business in terms of the bottom line,” Iger said in an interview on CNBC. „We’re not giving guidance on that but we do expect it to be nicely accretive for this company once we launch this universe.”
The pair have collaborated in the past as Marvel and Star Wars characters have appeared in Fortnite.
The company also reported diluted earnings per share that topped analysts’ expectations and revenue that was just shy of projections.2
| Q1 FY 2024 | Analyst Estimates for Q1 FY2024 | Q1 FY 2023 | |
|---|---|---|---|
| Revenue | $23.5 billion | $23.72 billion | $23.51 billion |
| Diluted Earnings Per Share (EPS) | $1.04 | 84 cents | 70 cents |
Going Where Consumers Are Going With Streaming
The Disney CEO also addressed the just-announced sports streaming partnership that the company’s ESPN unit entered into with Fox (FOXA) and Warner Bros. Discovery (WBD).
„I think this is a step that we felt was one that we not only wanted to take, but one that we really should take given what we know sports fans want and given what we see with the current multi-channel ecosystem,” Iger said, referring to the decline of the linear television business.
Still, Iger said Disney is committed to linear TV, saying the business remains profitable. „We’re investing in it in terms of the channels we own. We’re running them more efficiently but we’re still in that business,” he said. „But we also have to be mindful of where the consumer is now and where the consumer is going.”
Shares of Disney were up 6% at $105.10 about two hours after the closing bell.
Disney and Epic Games to Create Expansive and Open Games and Entertainment Universe Connected to Fortnite
“Our exciting new relationship with Epic Games will bring together Disney’s beloved brands and franchises with the hugely popular Fortnite in a transformational new games and entertainment universe,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “This marks Disney’s biggest entry ever into the world of games and offers significant opportunities for growth and expansion. We can’t wait for fans to experience the Disney stories and worlds they love in groundbreaking new ways.”
“Disney was one of the first companies to believe in the potential of bringing their worlds together with ours in Fortnite, and they use Unreal Engine across their portfolio,” said Tim Sweeney, CEO and Founder, Epic Games. “Now we’re collaborating on something entirely new to build a persistent, open and interoperable ecosystem that will bring together the Disney and Fortnite communities.”
“This will enable us to bring together our incredible collection of stories and experiences from across the company for a broad audience in ways we have only dreamed of before,” said Josh D’Amaro, Chairman, Disney Experiences. “Epic Games’ industry-leading technology and Fortnite’s open ecosystem will help us reach consumers where they are so they can engage with Disney in the ways that are most relevant to them.”
Deepening the Epic Games & Disney Relationship
Disney and Epic Games have engaged hundreds of millions of players through Fortnite content integrations, season collaborations, in-game activations, and live events, including the Marvel Nexus War with Galactus, which drew more than 15.3 million concurrent players.
Unreal Engine is used to produce assets and content across the Disney portfolio including in the development of video games like Kingdom Hearts 3 and Star Wars Jedi: Survivor; in cinematic editing and animation for film and streaming; and in the creation of more than 15 Disney Parks attractions like Millennium Falcon: Smugglers Run at Star Wars: Galaxy’s Edge.
Games Industry Growth & Disney Games Success
The digital world is growing and evolving with more than 3 billion video game players worldwide who want to move safely and seamlessly between the worlds they love, unleash their own creativity, and experience great gameplay.
Watch here Disney x Epic Games Trailer (Content is hosted by a third party – youtube.com/fortnite (viewing time 0:43)
Article sources:
– Disney Stock Jumps on Earnings Beat, $1.5B Investment in Fortnite Maker Epic Games(en) – ”investopedia.com”
– Disney and Epic Games to Create Expansive and Open Games and Entertainment Universe Connected to Fortnite(en) – ”thewaltdisneycompany.com”
Also read:
– JOIN THE FIGHT IN FORTNITE BATTLE ROYALE CHAPTER 5 SEASON 1: UNDERGROUND!(en) – ”stiridigitale.ro”
