Disney icon Bob Iger stunned the entertainment industry when he announced that he would be returning as chief executive for two more years. Iger, who had been named CEO in 2020, was succeeded by Bob Chapek, then head of parks. The Disney board approved Chapek's contract extension to 2025 in June. However, senior executives raised internal concerns that prompted the board to make a U-turn. Disney has now fired Chapek, while the board searches for a permanent replacement.
- “Succession” IRL: It is possible that conflicting loyalties played a part, as Chapek and his circle were apparently caught off guard by this decision.
- Disney shares rose 6% yesterday but have fallen 38% this year. Disney executives say Iger is “uniquely situated” to lead the company at this point.
Although Chapek was a key figure in Disney's survival of the pandemic, there were some public controversies during his tenure. Scarlett Johansson filed a lawsuit against Disney last year alleging breach of contract for “Black Widow.” Chapek narrowly avoided a workers revolt in April after he delayed responding to Florida's “Don't Say Gay” bill.
- The numbers side: Disney stock saw its largest plunge in 21-years this month, after it suffered a decline in revenue from its parks and resorts and a disappointing profit report.
- Disney+ added more subscribers than expected, but Disney's streaming business posted a $1.5B operating loss.
The Takeaway: Brand builders are difficult to replace… Iger spent 15 years building Disney into Hollywood's largest media conglomerate. This is the type of leadership investors and executives love to rely on when times are tough. It's happened before. In 1997, Steve Jobs returned to Apple's helm after 12 years. In April, Howard Schultz, Starbucks founder, was appointed interim CEO.