The Board of Directors of the Walt Disney Company has made a shocking decision to replace Bob Chapek with his predecessor Bob Iger as CEO.
Bob Iger had been the chief executive of the Walt Disney Company for 15 years until 2020. His successor, Bob Chapek, held the position since then, and has seen a less-than stellar performance, particularly with recent controversial decisions regarding the present and future business direction of the entertainment giant.
What does this surprising turn of events mean for Disney and its multi-billion dollar franchises? Read on for the details revealed so far.
The news of Bob Iger’s appointment as chief executive officer was posted at the official Walt Disney Company website on Sunday, November 20. The announcement reads as follows:
The Walt Disney Company (NYSE: DIS) announced today that Robert A. Iger is returning to lead Disney as Chief Executive Officer, effective immediately. Mr. Iger, who spent more than four decades at the Company, including 15 years as its CEO, 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 a successor to lead the Company at the completion of his term. Mr. Iger succeeds Bob Chapek, who has stepped down from his position.
— Walt Disney Company (@WaltDisneyCo) November 21, 2022
Meanwhile, his handpicked successor, Bob Chapek, was relieved of his position on the same day. The Walt Disney board of directors thanked the outgoing executive.
As Susan Arnold, Chairman of the Board of the Walt Disney Company states:
We thank Bob Chapek for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the pandemic. 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.
Coinciding with this, Bob Iger sent an email to Disney employees to confirm the Board’s decision and his return to the top position in the company’s hierarchy:
It is with an incredible sense of gratitude and humility — and, I must admit, a bit of amazement — that I write to you this evening with the news that I am returning to The Walt Disney Company as Chief Executive Officer.
Bob Iger returns to his previous capacity, which he held from 2005 to 2020. It was during Iger’s time as CEO that the Walt Disney Company acquired Pixar in 2006, the Marvel Comics properties in 2009, and Lucasfilm in 2012. While this collectively cost $15 billion, the profits from these acquisitions over the past several years have more than made up for it.
The shockingly quick development of this changing of hands within the House of Mouse comes after a disappointing series of events in the company.
During the earnings announcement earlier this November, Disney reported $1.5 billion in losses from the Disney+ streaming service. A significant factor of this came from high costs of original programming, such as Marvel Cinematic Universe and Star Wars content, but which failed to produce the desired financial returns.
Furthermore, the shares of Disney had fallen 41% for 2022 to a low of $98 per share. This situation was exacerbated by the apparent nonchalant attitude Bob Chapek had during the investor call, as well as the announcements of hiring freezes, layoffs, and other cost-cutting measures after the underwhelming quarterly report.
Bob Chapek took over from the retiring Bob Iger in 2020. The timing could not have come at a more inopportune time for Mr. Chapek’s tenure, as the Covid-19 pandemic began its global peak in that year.
The global pandemic paralyzed many industries that relied on mass gatherings of customers, which seriously affected Disney’s theme parks and theatrical releases. Plus, Bob Chapek was also infamously connected to the controversial decision regarding Scarlett Johansson’s pay for the release of her solo Marvel Studios film Black Widow in 2021.
Bob Iger, 71, will serve as Disney CEO for two years, effective immediately. Within the day of Bob Iger’s return as CEO, The Walt Disney Company’s shares have rallied up to over 8% premarket trading this Monday.