The Walt Disney Co., straining in the transition to streaming, announced that it has replaced CEO Bob Chapek with his predecessor Bob Iger in a bit of Return of the Jedi-type drama.
Iger had a legendary 15-year term as CEO of Disney. Near the end of his run he led Disney’s strategic shift to jump headlong into streaming by successfully launching Disney Plus in 2019.
Disney is now the leader in streaming subscribers, surpassing Netflix, but the company is losing about $1 billion a year on its direct-to-consumer video business.
The company said Iger has agreed to serve as Disney’s CEO for two years with a mandate from the board to set the strategic direction for renewed growth and to work closely with the board in developing another successor to lead the company.
“Mr. Iger has the deep respect of Disney’s senior leadership team, most of whom he worked closely with until his departure as executive chairman 11 months ago, and he is greatly admired by Disney employees worldwide — all of which will allow for a seamless transition of leadership,” said Susan Arnold, who remains chair.
“I am extremely optimistic for the future of this great company and thrilled to be asked by the Board to return as its CEO,” Iger said. “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.”
Analyst Steven Cahall liked the move.
"While Chapek's departure is not a surprise due to recent turmoil and the stock's decline, Iger's resurgence is a positive surprise. Iger will be viewed as a catalyst to improve the content aspects of Disney, and we expect bigger potential strategic changes around the long-term shape of DTC," Cahall said in a note Sunday night. "While the announcement doesn't solve all of Disney's problems, we think investors will embrace it as it puts perhaps the best leader in Media at the helm with a mandate to shake things up."
Iger rose from a weatherman at an ABC station to become head of Disney in 2005. He made important acquisitions in Pixar, Marvel and Lucasfilm, the maker of Star Wars.
He agreed to stay on for a few more years as CEO in order to satisfy Rupert Murdoch, who agreed to sell 21st Century Fox to Disney.
Toward the end of his tenure, Iger went through a series of potential successors before anointing Bob Chapek, who ran the company’s parks business, in 2020.
Iger left a big shadow and Chapek inherited the company as the pandemic set in and also had to helm the company during the expansive middle rounds of the streaming wars as Wall Street shifted its focus from adding subscribers to cutting losses and becoming profitable.
Also Read: Bob Iger Sells Off Half of His Disney Stock Holdings
The company said Chapek stepped down from his position. Chapek got a new three-year contract in June. At the time he was under fire for how he handled Disney's reaction to Florida’s “don't say gay” law.
Disney's stock price closed at 128.19 on February 25, 2020, Chapek's first day as CEO. It rose to a high of $197.18 on March 12, 2021 and close Friday at $91.80.
“We thank Bob Chapek for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the pandemic,” said Arnold. “The Board has concluded that as Disney embarks on an increasingly complex period of industry transformation, Bob Iger is uniquely situated to lead the Company through this pivotal period.” ■
