In a stunning reversal, the Walt Disney Co. DIS, +0.38% announced Sunday night that Chief Executive Bob Chapek was out, and will be replaced by his predecessor, Robert Iger.
“We thank Bob Chapek for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the pandemic,” boardf chair Susan Arnold said in a statement. “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.”
Iger served as Disney’s CEO from 2005-2020, and has served as executive chairman and chairman of the board since 2021. Over his 15-year tenure as CEO, Disney rebuilt itself as a media powerhouse, with the acquisitions of Pixar, Marvel, LucasFilm and 21st Century Fox.
“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,” Arnold said in the statement.
Earlier this month, Disney stock suffered its worst day since 2001 following what one analyst termed a “massive earnings downgrade,” after the company in its fourth-quarter earnings report forecast a significantly softer-than-expected, single-digit growth in the coming fiscal year, far below analysts’ consensus view of 25% growth.
That was all despite Disney’s best year for revenue growth in more than 25 years. Disney’s theme parks grew steadily after in the third year of the COVID-19 pandemic, its largest business segment, media and entertainment distribution suffered a sharp drop last quarter. And while the Disney+ streaming service is rapidly growing, it’s a money-loser. The service will add a cheaper, advertising-supported tier in December in a bid to draw more revenue.
Iger announced he was stepping down in February 2020, with Disney saying at the time he would continue to “direct the company’s creative endeavors.”
This past June, Disney extended Chapek’s contract for another three years, with Arnold calling Chapek “the right leader at the right time,” and saying he had the board’s “full confidence.”
Disney shares have fallen about 10% since June, and are down 38% year to date, compared to the 5% decline this year by the Dow Jones Industrial Average DJIA, +0.59%, of which it is a component.
In a statement Sunday night, Iger said he was “thrilled” to return.
“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.”
This is a developing story that will be updated.