Walt Disney (DIS) Is Up 6.0% After $1 Billion OpenAI Deal And AI Character Licensing Shift

• Earlier this week, The Walt Disney Company announced a three-year agreement to invest US$1.00 billion in OpenAI and license more than 200 Disney, Marvel, Pixar, and Star Wars characters for use on the Sora and ChatGPT Images generative AI platforms, with fan-created videos set to appear on Disney+ from early 2026.
• The deal highlights a shift in how Disney monetizes its intellectual property, tightly controlling AI use while turning fan-generated content into a new, licensed engagement channel.
• We’ll now examine how Disney’s US$1.00 billion OpenAI investment and AI-powered character licensing could reshape its longer-term investment narrative.

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Walt Disney Investment Narrative Recap

To own Disney today, you need to believe its core IP can keep anchoring films, parks, and streaming while the unified Disney+/Hulu/ESPN app becomes a stickier, more profitable bundle. The US$1.00 billion OpenAI deal does not change the near term focus on streaming engagement and sports-heavy cost discipline, but it could modestly ease one key risk by turning short form, user generated content from a headwind into a partially controlled funnel back into Disney+.

The most directly connected development is Disney’s cease and desist letter to Alphabet over alleged AI related copyright misuse, which now sits in sharp contrast to its tightly structured OpenAI partnership. Together, these moves reinforce that any upside from AI assisted fan content and production tools will live alongside legal, reputational, and regulatory risks tied to how Disney defends and licenses its characters across competing tech platforms.

Yet beneath the excitement around AI enabled fan videos, investors should be aware that Disney’s exposure to short form, third party platforms could still...

Read the full narrative on Walt Disney (it's free!)

Walt Disney's narrative projects $106.4 billion revenue and $11.9 billion earnings by 2028. This requires 4.0% yearly revenue growth and a roughly $0.3 billion earnings increase from $11.6 billion today.

Uncover how Walt Disney's forecasts yield a $133.22 fair value, a 19% upside to its current price.

Exploring Other Perspectives

Eight members of the Simply Wall St Community currently see Disney’s fair value between US$106.25 and US$133.22, reflecting wide variation in individual assumptions. Set against that spread, the new OpenAI partnership directly touches the risk that younger audiences keep drifting toward short form, AI powered, user generated content, with important implications for future Disney+ engagement and revenue growth.

Explore 8 other fair value estimates on Walt Disney - why the stock might be worth just $106.25!

Build Your Own Walt Disney Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Walt Disney research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free Walt Disney research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Walt Disney's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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