Disney Infinity Shuts Down, End of Disney as Games Publisher

Disney has cancelled the entirety of the Disney Infinity video game line, at a cost of $147 million dollars. This news is just coming in from Ben Fritz of the Wall Street Journal, but it’ll certainly have more of an impact in the days to come. The company has since released an official statement regarding the end of the game’s future.

Disney falls short of Wall Street estimates for revenue and earnings, stock falls 6% in after-hours trading

— Ben Fritz (@benfritz) May 10, 2016

Disney cancels struggling Infinity video game line. Takes $147 million charge. End of Disney as video game publisher.

— Ben Fritz (@benfritz) May 10, 2016

Disney Interactive posted an official blog addressing the news, stating that the company will be ending its work and support for Disney Infinity and stated that the game’s two final releases are on the way, before thanking everyone who worked on the game.

“By now you may have heard the news that we have made the difficult decision to discontinue production of Disney Infinity. From the beginning Disney Infinity was built for you—our fans—and I wanted to take a moment to thank you not just for your support over the years, but for creating a community that made Disney Infinity more than just a game,” they wrote.

“So what’s next for Disney Infinity? We have two final retail releases coming, including three new characters from Alice Through the Looking Glass later this month, and the Finding Dory Play Set launching in June.”

According to CNBC, the company reported in its earnings briefing that it had missed estimates by a large margin.

The company reported adjusted earnings of $1.36 per share on $12.97 billion in revenue for its fiscal 2016 second quarter. Its earnings per share missed analysts’ estimates for the first time in five years.

2016 has been a tough year for video games so far. According to Infinity Inquirer, subsidiary Avalanche Software is also closing down.

BREAKING: Disney has closed Avalanche Software as well.#DisneyInfinity

— Infinity Inquirer (@InfinityInq) May 10, 2016

According to an internal memo:

The team behind Disney Infinity created an incredible product. It was a critical success that inspired a deeply engaged community of players. But, despite Disney Infinity’s quality, it has become difficult to financially justify continued investment given the lack of growth in the toys-to-life market. Coupled with high development costs, the economics of our current vertical business model no longer add up.

What does this mean for Marvel, Star Wars, and related games like that? Disney will continue licensing that to third-parties.

We will update this story with more information as the news breaks.