Disney’s boomerang CEO holds on, as the company announced last week that Bob Iger’s contract, set to expire in 2024, would be extended to 2026, but a skeleton in Iger’s closet from 2019 could lead to Disney’s demise, and no one seems to be talking about that.
Look around, and you’ll be hard-pressed to find a chief executive officer with more of a celebrity following than Disney’s veteran CEO Robert A. Iger. Though some Disney fans like him more than others, Iger has a long history with the company, and over the years, he has garnered the support and even the admiration of Disney fans, many Cast Members, Disney Company executives, Hollywood celebrities, and some of Wall Street’s finest.
And as proven by two of its most newsworthy decisions over the last eight months, Iger also does very well with Disney’s Board. In November 2022, they voted to reinstate Bob Iger as The Walt Disney Company CEO, replacing a disgraced Bob Chapek following a laundry list of happenings and bad decisions at Disney–an apparent series of missteps on Chapek’s part–that ultimately forced the board’s hand in removing him from his post as CEO. Then, late last week, the board voted again, this time to extend Iger’s two-year contract by 24 months, netting the agreement a brand-new expiration date of December 31, 2026.
As news of Chapek’s removal became a viral story across every conceivable news outlet on Sunday evening, November 20, 2022, there were roars, screams, and various other exaltations from Disney fans around the globe who couldn’t contain their joy over what seemed like a Thanksgiving miracle–especially among fans who were visiting the domestic Disney Parks at the time of the announcement. And when the following newsy tidbit unveiled the name of Chapek’s replacement, the elation among fans was nearly palpable.
Just two weeks later, in early December, as Iger, accompanied by his wife, Willow Bay, walked toward the Candlelight Processional at Disneyland Resort in Anaheim, California, they were forced to make their way through crowds of elated Guests who couldn’t help but rush the veteran CEO and express their excitement about his triumphant return.
Per a post from DisneyDining in February 2023, Bob Iger had his work cut out for him upon his return to the chief role at Disney:
“When Iger stepped back into the role, the House of Mouse was a shambles, to say the least. Diehard Disney fans made up a majority of the steady stream of visitors at rival Universal’s theme parks, signaling a dissatisfaction among many who had long loved the Mouse. And only two weeks before Chapek’s removal, the company shared some of the most dismal earnings numbers in recent years. Cast Members throughout the Florida parks were in the middle of heated, unproductive negotiations with Disney when it came to wages, and the company was made the ‘Worst of the Woke’ list for the second year in a row.”
To say that Iger has a knack for this “CEO thing” and that his years at Disney’s helm have been successful would be an understatement. He is credited with broadening Disney’s scope by overseeing the acquisition of dozens of intellectual properties, the most notable being PIXAR, Lucasfilm, and Marvel–all of which have largely proven to be lucrative purchases. But one acquisition driven by Iger in 2019 has been nothing short of a financial nightmare for The Walt Disney Company, but it seems measures have been taken to keep the less-than-successful decision on Iger’s part less-than-loudly-publicized.
A deal between Disney and 21st Century Fox was struck in late 2017 but wasn’t completed until March 20, 2019. The deal was inked for a reported $71.3 billion, making it the most costly acquisition ever undertaken by The Walt Disney Company. In fact, as of April 2023, The Walt Disney Company had completed 19 acquisitions, which cost the company more than $87.10 billion, meaning that almost 82% of that total was spent on acquiring 21st Century Fox.
But unlike the promising and lucrative acquisitions of PIXAR Animation Studios in 2006, Marvel in 2009, and Lucasfilm in 2012, the acquisition of 21st Century Fox has been anything but lucrative, and the general public might not even realize how bad a decision the deal with Fox has been for Disney because of the success of one film–James Cameron’s Avatar: The Way of Water. The wild success of the second film in the Avatar franchise has hidden issues with the Disney-Fox deal, at least for now.
According to The Wrap, Iger’s choice to acquire 21st Century Fox might be the worst decision of the veteran CEO’s career at Disney:
As adult-skewing movies struggle in theaters and Wall Street changes the rules in the streaming war, Disney’s purchase of Fox’s studio properties may prove to be Iger’s biggest blunder, dealing lasting damage to the company’s reputation among shareholders for media-merger magic. The idea that Disney could take any given property, get audiences to associate it with its megabrand, and make it an even bigger cross-platform commercial success was part of how it sold Wall Street on the notion of total entertainment dominance.
Now with a weaker stock currency, heavier debt load, and skeptical investors, Iger has the harder challenge of squeezing performance out of an existing portfolio. He may not be able to buy his way out of this one.”