Key points
- What Adobe will build for Disney
- Why Disney's OpenAI deal fell apart
- What Disney says about Imagineering jobs
The Walt Disney Company (DIS) has hired Adobe (ADBE) to build generative AI models trained on Disney's own characters, settings, and visual styles. The two companies announced a multi-year alliance on November 9 at Adobe MAX, Adobe's yearly creativity conference. The models will be private and proprietary to Disney, Reuters reported.
The deal comes about eight months after Disney's last big AI partnership, with OpenAI, fell apart. Neither company put a dollar figure on the Adobe deal.
What will Adobe build for Disney?
The models run on Adobe Firefly Foundry, a service where Adobe works with one company to build AI models trained on that company's own material. Adobe said Disney's versions will learn "character attributes, environments, visual styles" from Disney's properties to produce "commercially safe and production-ready outputs."
Walt Disney Imagineering, the group that designs Disney's theme parks, already uses a model that turns hand-drawn sketches into finished concept art. It also has a custom image model that makes pictures true to each franchise. Adobe first announced that Imagineering project in June.
Under the new deal, Adobe becomes Disney's "Official AI Innovation Partner." That means early access to Firefly, Premiere, and Photoshop. Adobe's also putting its own engineers and researchers on Disney's work. Adobe will also work with StudioLAB, the experiments group inside Walt Disney Studios, and with ESPN Edge, the sports network's technology lab. At ESPN, the two companies will look at ways AI can help ESPN reach sports fans and bring more of its archive to them.
There's a marketing side, too. Adobe gets to tell its story through Disney World, Disneyland, Disney Cruise Line, ESPN Edge, and StudioLAB, and it'll show up more across Disney's media platforms.
What happened with OpenAI?
In December 2025, Disney agreed to take a $1 billion stake in OpenAI and license more than 200 characters from Disney, Marvel, Pixar, and Star Wars to Sora, OpenAI's video app. Fans would have been able to make short videos with those characters. Disney also planned to become a major OpenAI customer, using its APIs to build products and rolling out ChatGPT to employees.
On March 24, about three months later, OpenAI said it was shutting Sora down. Disney then ended its partnership with OpenAI, including the planned $1 billion stake, Variety reported. A Disney spokesperson said the company would "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."
There's a pattern here. In 2025, Disney sent cease-and-desist letters over its characters to Character.AI and Google. Then in September, it hired Character.AI's chief executive, Karandeep Anand, as its first chief technology officer. Now it's working with Adobe to train models on those same characters. The common thread is control. Disney wants a say in how its characters get used.
Sora would have let fans make videos with them on someone else's app, and OpenAI shut that app down. The Adobe models announced so far are aimed at Disney's own creative work, and they're being built for Disney's use. Other AI companies still want in. Google later pitched studios on licensing characters for its own AI.
Does Disney plan to replace artists?
Kyle Laughlin, Disney's senior vice president of R&D technology and engineering, told Reuters the tools are "in no way meant to replace" jobs at Imagineering. He's pitching them on speed. "What Adobe Foundry has allowed us to do is compress the creative process that would have taken months to now being able to do that in hours and days," he said.
Laughlin said faster rounds of design help Imagineering reduce "costly changes in the field" once construction starts. Laughlin's comments come as Disney weighs broader job cuts. Bloomberg News reported earlier this month that the company was considering cuts of thousands of jobs, Reuters noted.
How are the two stocks doing?
Adobe shares were at $237.50 at 11:19 a.m. Eastern on November 9, down 0.8% from Friday's close of $239.30. They're down about 32% this year, as investors worry AI tools will cut into what companies pay for software. We looked at that fear in our piece on the SaaSpocalypse.
The Disney deal is the answer Adobe would like investors to hear. Firefly Foundry builds models for one customer, trained on that customer's own material, and Disney's will be private to Disney. Adobe's pitching a product built on Disney's own material for Disney alone, which is a different thing to sell than a general AI tool anyone can buy.
Disney shares were at $118.06 at the same time, up 1.1%.
Disney reports its fiscal fourth-quarter results before the market opens on November 17. That call is the next chance for analysts to ask what the deal costs and how Disney plans to use the models across its studios.
