:max_bytes(150000):strip_icc()/GettyImages-1526716379-2b8f1a6be83f4614bf56875633313219.jpg)
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 over 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 an earnings beat for diluted earnings per share and on par with revenue projections.
| 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 |
Shares of Disney were up 6.3% at $99.14 per share in after-hours trading on the news. They’ve gained over 9% year-to-date.