Group writes losses
Ex-boss Iger makes a surprising return to Disney
11/21/2022 8:04 am
With the acquisitions of “Star Wars”, Pixar and “Marvel”, Bob Iger formed today’s Disney group over the years. After he gave up the post in 2020, the company slipped deep into the red in the streaming business. Now the 71-year-old is taking the helm again.
There is a surprising change of boss at entertainment giant Disney: Long-time CEO Bob Iger is returning to the top. Iger has agreed to take the lead again for two years, Disney said. He had been Disney boss for 15 years. It was said that his successor, Bob Chapek, had resigned. Iger, 71, is once again taking the helm at a difficult moment for Disney and the entertainment industry as a whole. The group has to take account of consumers’ reduced willingness to spend in times of high inflation. At the same time, revenues from cable TV in the USA are falling.
A particular problem is the streaming business. It’s growing fast with services like Disney+, but it’s in the red. In the last quarter alone, it brought in an operating loss of $1.47 billion. The reason for this is the high cost of elaborately produced films and series that have not yet been brought in from subscription revenues. Chapek had promised that the area should be profitable by September 2024. The theme parks, which are booming after the pandemic break, are making up for the losses.
With the most recent quarterly profit of 162 million dollars, Disney missed the expectations of the stock market, the stock continued to fall. Chapek announced austerity measures such as a hiring freeze and job cuts. Disney has also been targeted this year by aggressive investors who buy into companies and then demand change. At times, billionaire Dan Loeb called for the sports broadcaster ESPN to be sold.
Chapek and Iger at odds
Iger is the architect of today’s Disney Group. During his era, the entertainment giant bought animation studio Pixar, the companies behind the Star Wars series and the lucrative Marvel films, and Hollywood studio 21st Century Fox. And he brought Disney into the streaming business on the home stretch of his tenure. Chapek, who was previously in charge of the theme parks, took over in 2020 as Iger’s own preferred successor. Disney preferred him to streaming boss Kevin Mayer, who had high hopes for the post. Mayer left the group and was temporarily head of the video platform Tiktok.
Most recently, however, Chapek and Iger were in dispute, according to media reports. The business broadcaster CNBC reported that the tensions had started early on with an interview with Iger, in which he had promised Chapek support in overcoming the corona pandemic. However, the new boss felt patronized by his powerful predecessor, it said, citing informed people. Iger was also Chapek’s chief supervisor as chairman of the board of directors and only left this post eleven months ago. A factor in the rift was also a corporate restructuring carried out by Chapek, in which budget responsibility was centralized, CNBC reported back in March. As a result, Disney was able to make decisions more quickly, but the heads of individual divisions lost a lot of freedom in spending and were dissatisfied, it said.
Disney’s handling of a dispute with actress Scarlett Johansson was also considered unfortunate under Chapek’s leadership. She sued the company for lost revenue after her film “Black Widow” was also released online during the corona pandemic. Disney countered that Johansson had already received $20 million. The dispute was settled out of court, but left the company in a bad light.