Crystal ball: Although Disney is unlikely to attempt a purchase of the gaming giant anytime soon, the idea remains on the table, according to people familiar with the company's inner workings. Both companies are facing fresh headwinds, but Disney has long aspired to establish a major presence in gaming and virtual entertainment.
Sources newsletter author Alex Heath recently said he "knows for a fact" that some senior Disney executives are waiting for the right moment to buy Fortnite and Unreal Engine developer Epic Games. However, others within the company disagree.
Heath made the comments on a recent episode of The Town with Matt Belloni, where the two discussed how recent events could affect both companies' fortunes. Disney is already heavily invested in Epic, and others with inside knowledge have previously suggested the company could acquire it or another major video game publisher.
Bloomberg reported in 2023 that Disney executives were urging Bob Iger to purchase either EA or another large publisher, but the CEO was not interested. Earlier this month, former Disney executive Kevin Mayer told CNBC that Disney would be a natural fit if Epic ever decided to sell.
Disney invested $1.5 billion in Epic in 2024 to help build a themed experience within Fortnite, possibly as a successor to the media giant's failed metaverse ambitions. While Meta and other companies have stepped back from the once-popular concept, Fortnite remains one of the few successful examples of anything resembling a metaverse.
However, although much of Disney's content is already available within Fortnite, the company's broader planned ecosystem inside the game has yet to materialize.
Beyond Fortnite, Unreal Engine is Epic's other crown jewel. It powers not only a large share of AAA games released in recent years, but also enterprise 3D rendering tools and visual effects production for Disney-owned properties such as The Mandalorian.
Still, as Heath notes, founder and CEO Tim Sweeney's control over Epic makes a sale unlikely in the near term, even as both companies face significant setbacks announced around the same time.
Last week, Epic confirmed more than 1,000 layoffs, citing slowing Fortnite growth, broader industry challenges, and costly legal battles with Apple and Google.
Sweeney later apologized for laying off a terminally ill employee and pledged to help restore their life insurance coverage. In the same week, Disney's $1 billion deal with OpenAI fell apart as the ChatGPT maker shut down Sora, its AI video generation service.
Despite the current situation, Heath claimed that Disney executives would be the natural choice if Sweeney ever decided to sell Epic.