Josh D’Amaro’s Disney Strikes After OpenAI Deal Ends, Epic Games Cuts

Twenty-four hours earlier than the information broke that the $1 billion Disney-OpenAI partnership was useless, workers at each firms had been nonetheless working to develop their plan to deliver Disney’s characters to the Sora video platform and Disney+. Yet, on Tuesday, OpenAI shuttered Sora, and Disney, led by CEO Josh D’Amaro, pulled out of the settlement, which hadn’t but closed.

Welcome to the CEO suite, Josh.

Less than every week after taking on the coveted job of CEO of The Walt Disney Co., Josh D’Amaro finds himself navigating a flurry of main occasions that can affect the corporate. Some might alter its strategic focus. Others its content material or experiences.

But they’ll have an effect, and it’s now D’Amaro’s disaster to unravel.

From the collapse of the OpenAI deal to a strategic shift from Disney companion Epic Games; a dramatic last-minute resolution to drag an basically accomplished season of ABC’s The Bachelorette to a Middle East theme park which may be impacted by the struggle in Iran, there isn’t a a part of Disney’s enterprise that’s unscathed.

But it was Tuesday’s double-whammy of OpenAI and Epic Games that put D’Amaro’s personal priorities within the highlight. Sources near D’Amaro’s considering have informed The Hollywood Reporter that gaming and interactivity had been key strategic focus factors for him.

“He sees the digital realm — and Epic is a manifestation of that — as a very important place for fans to interact with their favorite characters, franchises and brands in a comprehensive way that you can monetize and that will serve fan interest in a way that, other than a theme park, it’s really impossible to do,” stated Kevin Mayer, the previous head of technique at Disney who now co-leads Candle Media.

Tuesday, nevertheless, Epic Games slashed about 20 % of its workers, greater than 1,000 jobs, citing issues with its flagship Fortnite franchise … the identical franchise that Disney’s Epic Games deal is linked to.

“The downturn in Fortnite engagement that started in 2025 means we’re spending significantly more than we’re making, and we have to make major cuts to keep the company funded,” Epic Games CEO Tim Sweeney informed workers in a blunt memo explaining the cuts.

D’Amaro was the driving pressure behind Disney’s $1.5 billion Epic Games funding (he joined Epic’s board as an observer), and a deliberate IP-laden Disney universe linked to Fortnite. Sweeney informed THR final month that the challenge is progressing, although the businesses can’t share particulars simply but.

“Josh and Disney really get it and have a crisp understanding of how the future of their film and TV IP, Disney+ and games fit together into a digital ecosystem and tie into parks and other things,” he stated.

But Epic’s cuts do elevate questions on the way forward for the challenge, particularly if Fortnite’s troubles proceed. D’Amaro continues to raise gaming, transferring Disney video games chief Sean Shoptaw into Dana Walden’s purview, putting him alongside Disney’s TV and movie management.

Conversely, maybe Disney’s trove of characters could be the driving pressure that turns Fortnite round. Given the fandoms round Marvel, Star Wars and different franchises, it definitely isn’t out of the query.

OpenAI, in the meantime, was a billion-dollar guess from D’Amaro’s predecessor Bob Iger, who informed Wall Street analysts afterward that if the tech goes to occur, then Disney must discover a strategy to embrace it.

“We’ve always felt that if it’s going to happen, including disruption of our current business models, then we should get on board and figure out how we advantage our company and our shareholders, you know, by moving forward with a sense of optimism and being aggressive about it,” Iger stated.

But the partnerships drew angst from creatives, cautious of the slop that Sora produced, and with the corporate cavalierly selecting to disregard any guardrails round IP when it launched. Iger had a imaginative and prescient to deliver the very best Sora movies to Disney+, and in the end to allow Disney+ customers to create their very own brief AI-generated movies.

That might nonetheless occur. Disney will not be essentially getting out of the AI enterprise altogether.

The firm stated Tuesday that “we will continue to engage with AI platforms to find new ways to meet fans where they are while responsibly embracing new technologies that respect IP and the rights of creators,” however with OpenAI out, it isn’t clear who else they might companion with within the close to time period.

When D’Amaro addressed Disney shareholders on March 18, the exec stated he desires to make Disney+ a “digital centerpiece” of the corporate, “a portal that connects our stories, experiences, games, films, and more in entirely new ways.”

As for The Bachelorette, which ABC pulled from its lineup after video surfaced of an alleged home violence incident involving star Taylor Frankie Paul, sources notice that the choice was made a few rungs under D’Amaro, although the transfer might price Disney tens of hundreds of thousands of {dollars}. There is already hypothesis that Disney might attempt to salvage the present by placing it completely on Hulu.

But a high-profile dispute round certainly one of ABC’s flagship franchises will not be what the corporate wants for the time being.

And then there’s Disney’s experiences division, the place D’Amaro minimize his enamel.

The challenges the corporate faces at this time pale compared to the COVID-19 pandemic, however as soon as once more worldwide affairs are discovering a strategy to affect Disney’s planning.

Last 12 months, Disney introduced plans for a brand new theme park in Abu Dhabi, funded and constructed by the Miral Group, however developed with Disney. In an interview with THR on the time, D’Amaro famous {that a} third of the world is just some hours by aircraft from the UAE.

“Abu Dhabi is an incredible place,” he stated. “It’s an international crossroads, a place that celebrates art and creativity and still celebrates their heritage, something that fits very nicely with the Disney company, and we think with this new park, we have an opportunity to celebrate everything that is special about the Disney stories, all the tradition that comes along with our theme parks, but really lean into a modern aesthetic.”

Now, after all, Abu Dhabi finds itself in the midst of the U.S. and Israel’s struggle on Iran, with missiles and drones being despatched towards the UAE, and the long-term ramifications of the struggle nonetheless unknown.

At Disney’s annual assembly final week, in a video that served as an introduction to his tenure as CEO, D’Amaro alluded to the Abu Dhabi challenge as “the first new park in a decade in a brand new corner of the world,” as a rendering of the park appeared onscreen. He didn’t point out Abu Dhabi.

The park continues to be a few years away, and Abu Dhabi’s aim of turning Yas Island into a world vacationer vacation spot stays ongoing, however it’s yet one more problem for D’Amaro to navigate.

A CEO of a Fortune 500 firm as soon as informed me that the job is to set the tone and technique for the corporate’s future, whereas adapting to the fact of the current. If you run an airline, you must sport out what Iran means for oil costs and journey plans and develop a method to safe extra market share; in the event you run a world retailer, that you must adapt to tariffs and safe provide chains whereas protecting buyer visitors rising; in the event you run a tech firm, that you must make your AI bets whereas determining the place to drag again ( you, Meta and Mark Zuckerberg).

D’Amaro set the tone for his run as CEO final week, embracing expertise and the artistic engines that energy Disney.

“Simply put, while others in our industry are consolidating just to compete, or struggling to be relevant in a fragmented and disrupted world, Disney is in a category of one poised to accelerate into our next era of innovation and growth,” D’Amaro informed Disney shareholders. “And this next chapter will be driven by staying focused on world-class creativity, enhanced by technology, bringing unforgettable stories to audiences wherever they are.”

But the times that adopted present that he’ll must be simply as nimble in relation to adapting to the hand he’s dealt, be it a tech partnership or TV franchise that will get pulled, or world occasions that affect visitation to its profitable experiences division.