Walt Disney (DIS) Invests $1 Billion in OpenAI Deal

The Walt Disney Company (NYSE:DIS) is one of the 14 Best Large Cap Stocks to Invest In Now. On December 11, Reuters reported that The Walt Disney Company (NYSE:DIS) is making a $1 billion investment in OpenAI. This deal will allow OpenAI to use in its Sora AI video generator characters from Star Wars, Pixar, and Marvel.

This three-year partnership deal between OpenAI and The Walt Disney Company (NYSE:DIS) has the potential to change how Hollywood creates content and it marks a key moment in Hollywood’s embrace of generative AI. It also sidesteps worries about AI hurting jobs or intellectual property rights.

Under the licensing agreement, starting early in 2026, Sora and ChatGPT Images will generate videos with Disney characters like Mufasa, Cinderella, and Mickey Mouse. The deal does not include any talent likenesses or voices.

The Walt Disney Company’s (NYSE:DIS) CEO, Bob Iger, said that this collaboration will carefully expand the company’s storytelling with generative AI. It will also respect and protect creators and their work.

Iger first hinted at this strategy during a November investor call, where he noted that AI would let The Walt Disney Company (NYSE:DIS) offer tools to help Disney+ users make and enjoy user-generated content, primarily in short form. Under the agreement, a selection of user-generated videos will become available for streaming on Disney+. This will allow the platform to benefit from the growing appeal for short-form video content.

The Walt Disney Company (NYSE:DIS) is an American multinational mass media and entertainment conglomerate that operates through 3 core business segments: Disney Entertainment, ESPN, and Disney Experiences.

While we acknowledge the potential of DIS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 14 Most Promising Fintech Stocks to Invest In and 15 Best Technology Penny Stocks to Buy.

Disclosure: None. This article is originally published at Insider Monkey.