Disney's 'AI Magic' on Advertising - Will It Be A Boost For Disney+ and Hulu?
Portfolio Pulse from Anusuya Lahiri
Walt Disney Co (NYSE:DIS) has developed 'Disney's Magic Words,' an AI-powered advertising tool for Disney+ and Hulu, aimed at tailoring commercials to specific scenes or moods. This innovation comes as Disney reports a 3% drop in advertising revenue to $3.35 billion in Q1 fiscal 2024, reflecting a broader industry shift away from traditional TV. Despite this, Disney's strategic investment in streaming ad technology and AI across its divisions underscores its adaptation to changing market dynamics. However, Disney's Q1 revenue was flat at $23.5 billion, missing estimates, and its shares fell by 2.04%.
February 09, 2024 | 5:09 pm
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Disney's introduction of 'Disney's Magic Words' and its strategic investment in AI and streaming ad technology reflect its adaptation to the digital shift in advertising, despite a 3% drop in ad revenue and flat Q1 revenue.
Disney's development of 'Disney's Magic Words' demonstrates its commitment to leveraging AI for advertising, aiming to offset the decline in traditional TV viewership and advertising revenue. The 3% drop in advertising revenue and flat Q1 revenue indicate challenges in the advertising sector, but Disney's strategic investments in AI and streaming technology could position it well for future growth. The short-term impact on DIS shares is neutral to slightly negative due to the mixed financial results and market reaction, but the strategic direction could be beneficial in the long term.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100