Two weeks after reporting disappointing fourth quarter earnings that missed Wall Street’s expectations on both the top and bottom line, Disney announced the immediate return of Bob Iger as CEO of the company he had previously led from 2005 to 2020. Iger will replace Bob Chapek at the helm of Disney, his hand-picked successor who had fallen out of favor with Disney’s board of directors after a tumultuous two-and-a-half-year tenure.
Interestingly, Chapek’s contract had been renewed for three more years as recently as June 2022. Back then, Disney Chairwoman Susan Arnold wrote that “Bob is the right leader at the right time,” expressing the board’s “full confidence in him and his leadership team.” Five months later, that confidence has apparently evaporated, raising some question over the sincerity of those comments earlier this year.
With Iger’s return, Disney hopes to bring back a sense of optimism to the company. And while the sentiment surrounding the Burbank, California-based media giant has been overwhelmingly negative lately – the company’s share price is down more than 50 percent from its March 2021 peak – not all is bad at the Magic Kingdom. As the following chart shows, the company’s Parks & Experiences business bounced back strongly from its Covid slump, while the Linear Networks delivers steady results and the Direct-to-Consumer (i.e. streaming) business keeps growing. For the fiscal year ended Oct. 2, 2022, Disney reported revenues of $82.7 billion, up from $69.6 billion in the year ended Sept. 29, 2019, i.e. the last pre-pandemic year.
“I am extremely optimistic for the future of this great company and thrilled to be asked by the Board to return as its CEO,” Mr. Iger said in the announcement of his return. “Disney and its incomparable brands and franchises hold a special place in the hearts of so many people around the globe—most especially in the hearts of our employees, whose dedication to this company and its mission is an inspiration. I am deeply honored to be asked to again lead this remarkable team, with a clear mission focused on creative excellence to inspire generations through unrivaled, bold storytelling.”