The Walt Disney Company (DIS) has announced, citing "current economic realities," that it is closing Blue Sky Studios, an animation division that had been a property of 21st Century Fox, which Disney acquired in 2019. Blue Sky is best known for its "Ice Age" series of five films, which collectively have grossed $3.2 billion at the box office internationally.
In total over its history, Blue Sky has produced 13 feature films, with total international box office gross revenues of $5.9 billion. Beside the "Ice Age" series, other Blue Sky releases were "Rio," "Rio 2," "Dr. Seuss' Horton Hears a Who!," "Ferdinand," "Epic," "Robots," "The Peanuts Movie," and "Spies in Disguise."
- Disney is closing Blue Sky Studios, an animation division acquired with Fox and best known for its "Ice Age" series of films.
- Disney appears to be rationalizing its various animation properties.
- Disney has acquired several other animation properties over the years, including Pixar, Lucasfilm Animation, and the animation division of 20th Century Studios.
Blue Sky Closure Details
Blue Sky is based in Greenwich, Connecticut, and employs 450 people. Closure is slated for April 2021, and Disney indicates that it will assist these people in finding open positions at other animation studios that it owns.
Meanwhile, Disney is canceling a Blue Sky science fiction film called "Nimona." Previously scheduled for release on Jan. 14, 2022, work on this film already has been underway, with 10 months of further production planned. Meanwhile, a series based on characters from "Ice Age" is under development, slated for release on the Disney+ streaming service and now apparently to be completed by one of the company's other animation studios.
The thirteenth and final film produced by Blue Sky, "Spies in Disguise," released in December 2019, was its worst-performing release, grossing $66 million at the box office in the United States and $171 million globally. Andrew Milstein and Rob Baird, the co-presidents of Blue Sky since August 2019, are expected to leave Disney. Milstein previously was president of Walt Disney Animation Studios.
Significance for Investors
Disney's feature film business has been hurt by the protracted government-ordered closures of theaters worldwide in response to COVID-19. In addition to the company's oldest division – the Walt Disney Animation Studios in Burbank, California – Disney has acquired several other animation properties over the years, including Pixar, Lucasfilm Animation, and the animation division of 20th Century Studios. Disney apparently feels that it has excess production capacity in the area of animated films and is seeking to rationalize it.