Disney Extends CEO Bob Iger’s Contract
The Walt Disney Company announced it has extended CEO Bob Iger’s contract by two years, and he will continue to serve as Chief Executive Officer through December 31, 2026. (Well, assuming no further extensions or abrupt resignations, neither of which are a given based on his past precedent!) This post shares the announcement followed by our commentary and background context for the Iger extension.
Here’s the press release from the Walt Disney Company:
In voting unanimously to extend Iger’s contract by two years, the independent members of the Board of Directors noted that Iger’s extension provides continuity of leadership during the company’s ongoing transformation, and allows more time to execute a transition plan for CEO succession, which remains a priority for the Board.
“Time and again, Bob has shown an unparalleled ability to successfully transform Disney to drive future growth and financial returns, earning him a reputation as one of the world’s best CEOs,” said Mark G. Parker, Chairman, The Walt Disney Company. “Bob has once again set Disney on the right strategic path for ongoing value creation, and to ensure the successful completion of this transformation while also allowing ample time to position a new CEO for long-term success, the Board determined it is in the best interest of shareholders to extend his tenure, and he has agreed to our request to remain Chief Executive Officer through the end of 2026.”
“Since my return to Disney just seven months ago, I’ve examined virtually every facet of our businesses to fully understand the tremendous opportunities before us, as well as the challenges we’ve been facing from the broader economic environment and the tectonic shifts in our industry. On my first day back, we began making important and sometimes difficult decisions to address some existing structural and efficiency issues, and despite the challenges, I believe Disney’s long-term future is incredibly bright,” said Iger.
“But there is more to accomplish before this transformative work is complete, and because I want to ensure Disney is strongly positioned when my successor takes the helm, I have agreed to the Board’s request to remain CEO for an additional two years. The importance of the succession process cannot be overstated, and as the Board continues to evaluate a highly qualified slate of internal and external candidates, I remain intensely focused on a successful transition.”
Iger returned to the company in November of 2022 after serving as CEO and Chairman from 2005 to 2020, and then as Executive Chairman and Chairman of the Board through 2021. Since returning as CEO, he has led a significant, enterprise-wide transformation to restore creativity to the center of the company and position Disney’s streaming business for sustained growth and profitability. Throughout his time as the company’s chief executive, Iger’s strategic vision has focused on three fundamental pillars: generating the best creative content possible; fostering innovation and utilizing the latest technology; and expanding into new markets across the globe.
Widely recognized as one of the world’s most consequential business leaders, Iger has built on Disney’s rich history of unforgettable storytelling with the acquisitions of Pixar (2006), Marvel (2009), Lucasfilm (2012), and 21st Century Fox (2019); the landmark opening of Disney’s first theme park and resort in mainland China, Shanghai Disney Resort; and the release of a number of record-setting films, including Marvel’s Avengers: Endgame, Disney’s Frozen and Frozen 2, and Marvel’s groundbreaking Black Panther. Always one to embrace new technology, Iger made Disney an industry leader through its creative content offerings across multiple new platforms, including the highly successful launch of the Disney+ streaming service in November 2019.
Iger first became Chief Executive Officer of Disney in October 2005 and was elected Chairman in 2012. From 2000-2005, he served as Disney’s President and Chief Operating Officer. Iger officially joined the Disney senior management team in 1996 as Chairman of the Disney-owned ABC Group, and in 1999 was given the additional responsibility of President, Walt Disney International. He began his career at ABC in 1974.
Iger was inducted into the Television Academy Hall of Fame in 2020, and the Broadcasting and Cable Hall of Fame in 2015. In 2022, he was recognized as an Honorary Knight Commander of the Most Excellent Order of the British Empire by Her Late Majesty Queen Elizabeth II for his services to the UK/US relations. He is the author of the New York Times best-selling book The Ride of a Lifetime: Lessons Learned from 15 Years as CEO of The Walt Disney Company, which has sold more than a million copies since its publication in 2019. He is a graduate of Ithaca College.
File this one under Least Surprising News Ever. What’s next on the summer rerun schedule, news of (yet another) Main Street Electrical Parade “farewell” run?! Although Iger repeatedly stated that he has “no intention” of staying longer than 2 years as CEO through 2024, Iger also previously stated that he had “no intention” of returning to the Walt Disney Company after Bob Chapek took the helm.
And we all saw how that turned out, culminating in last Christmas season’s #1 smash sensation: Disney’s Bob Swap. A movie that simultaneously does not exist, but also has outperformed 50% of Disney’s recent releases at the global box office. Impressive feat, to be sure!
Prior to this, Iger extended his tenure as CEO after planning to retire on four different occasions between 2013 and 2017. He then retired without warning, and subsequently returned by surprise. Well, surprise isn’t really the right word. Countless commentators predicted his return, including this blog.
Even those who failed to call the Bob Swap probably saw today’s announcement coming a mile away. This news is about as surprising as an M. Night Shyamalan movie having a twist ending, or Walt Disney World raising prices. Pretty much everyone knew Iger would extend again, even as he denied it.
By and large, the response among Walt Disney World fans was positive when Bob Iger returned last November. It’s difficult to quantity, but I’d peg the “approval rating” of that move at around 85% or 90%.
In large part, that was because the reign of Bob Chapek was so terrible, and literally anyone would’ve been deemed an improvement. As we wrote at the time, Bob Chapek Did Not “Get” Disney, and he had an open animosity towards fans. Bob Iger’s homecoming was also viewed positively because he was still largely beloved, and his tenure–although having its share of ups and downs–was a tremendous time of growth for Disney.
Well, the honeymoon is over. Sentiment has already shifted about Bob Iger. Without reading any hot takes or fan feedback, I’m guessing that the responses to this news will be much more mixed–probably about 50/50. It wouldn’t even surprise me if Iger’s approval rating is slightly underwater.
In large part, this will be due to the ongoing culture wars, and Iger now being the face of the DeSantis vs. Disney feud in Florida. It’s not just that, though. Plenty of fans are disappointed that Iger has not done enough to steady the ship or right past wrongs by Chapek. Personally, I think expectations are a little unrealistic on both fronts given what Iger inherited. He’s playing the cards he was dealt (…which he himself kinda dealt to Chapek).
Regardless, my perspective on this isn’t really positive or negative, but instead that Bob Iger’s contract extension is necessary. I am ready for the Walt Disney Company to open a new chapter, but also have a tremendous amount of respect for what Iger has accomplished. I don’t think he’s infallible; there have been unforced errors, including his own succession planning (or lack thereof). So he’s partly cleaning up his own past missteps.
I also recognize that the Walt Disney Company is at an inflection point, that it’s a time of transition, and there’s tremendous turmoil in the legacy media space. Given the circumstances, there’s no one who I feel is more equipped to navigate these rough waters than Bob Iger, and I suspect it’ll take until 2025 for Disney to emerge from the storm.
This extension provides Iger the chance to cement his legacy; it also gives his successor enough runway for a clean break, and not having to be tarnished by the tough decisions that’ll be made now and in the next 18 months. It seems win-win to me.
So I guess the question I have for those who are disappointed about Disney extending Bob Iger’s contrast is, what *realistic* outcome would you have preferred here?
Disney still has to “deal with” both Hulu and ESPN; the decline of linear as cable cord-cutting accelerates and ad revenue dries up; attempting to make streaming services profitable; paying down debt as a result of the 20th Century Fox acquisition; and that’s just a partial list of the huge headwinds facing Disney!
Who inside or outside the Walt Disney Company is actually equipped to jump into the CEO seat and handle all of that? If you think this is an easy task…just look at all of the other legacy media companies and how poorly they are dealing with a subset of these problems. Who would you rather have at the helm, David Zaslav?!?
Previously, CFO Christine McCarthy’s name appeared atop the list of five talked-about candidates for the future CEO job. She’s now gone. That list also is/was rumored to have included Dana Walden, Disney’s television chief, and Josh D’Amaro, Disney’s theme park chairman. Previous reporting suggests that the board doesn’t view either candidate as “quite ready” for the role.
However, the board supposedly does believe that former Disney executives Tom Staggs and Kevin Mayer are ready, as they were also considered to replace Chapek as CEO before Iger was brought back on board. In case you’re unfamiliar with the names, these are two previous candidates to replace Iger who left Disney when it became clear they’d be passed over for CEO.
These two are now running the Candle Media startup together. We had hoped–and continue to hope–that Disney would/will acquire Candle Media. So far, that has not happened, and there are no rumors to suggest it’s even a possibility. So both of them are out as near-term CEO/COO/President candidates.
Ultimately, I would like to have someone from Parks & Resorts serve as CEO of the Walt Disney Company. Right now, that would be Josh D’Amaro. This blog has not been shy in its favorable stance towards D’Amaro. Some have suggested that he gets a “free pass” on bad decisions because he’s handsome and smoother than Chapek was; that may be true to an extent, but we’re not blinded by his beauty.
We have heard enough about D’Amaro from past colleagues and Cast Members to give D’Amaro the benefit of the doubt. Everything suggests that he’s the real deal, someone who truly “gets” Walt Disney World and Disneyland, cares about Cast Members and the guest experience, and would advocate for theme parks.
With that said, there’s also the reality that D’Amaro has next to no accomplishments under his belt. Aside from a handful of favorable moves to improve guest satisfaction at the beginning of year (and more announced for 2024), there’s nothing you can point to that’s attributable to D’Amaro. He’s very well liked and seems to have a solid grasp of the parks, but he does not have any major achievements to speak of. That’s a problem for a CEO candidate.
It’s also a problem that, as of right now, Parks & Resorts is not the focus of the Walt Disney Company. If Bob Iger and the board were to start grooming a CEO successor today, it would necessarily have to be someone on the media side of the business–perhaps Dana Walden. I don’t know anything about her so cannot speak to her qualifications, but that’s not really the point.
I want to see someone–anyone–come from the Parks & Resorts side of the business. I want that to be the company’s focus. That’s my personal bias. It would be nice to have a CEO who came up through the parks and understands their importance to the company’s creative legacy–and not just as the goose(s) that lay golden eggs.
There is absolutely no chance that the new CEO would have a theme parks pedigree if named today. It would have to be someone with experience on the media side, able to handle potential M&A, cost-cutting, and other unpleasant tasks required as streaming attempts to attain profitability and other tumult in the legacy media space is dealt with. Josh D’Amaro has zero expertise with any of that. Nobody at Parks & Resorts does.
However, the landscape will (hopefully!) be very different by December 2026. By that point, Disney+ will have been profitable for at least a year (knock on wood), Hulu will have been bought or sold, ESPN will have been figured out, and more of the debt load will (hopefully) be reduced. Bob Iger will (hopefully) have navigated the Walt Disney Company through those rough waters, and media will be “figured out.”
With that in the rearview mirror, the company will have (also hopefully) pivoted back towards parks, finally announcing the first phase of the $17 billion investment at Walt Disney World and expansion as part of DisneylandForward in California. Standing on the precipice of another “Disney Decade” for the theme parks, it will make complete sense to promote someone to the CEO role from that side of the business.
Of course, all of this is highly wishful thinking that assumes a lot of best case scenarios…but it’s still more realistic than ending Bob Iger’s run in 2024, bringing in a new CEO in a trial by fire kind of situation, and simply hoping everything will work itself out. We’ve already seen that movie once not that long ago–it was called “The Terrible Reign of Bob Chapek.” I don’t know if you saw that one, but (spoiler alert) it did not go well.
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OUR THOUGHTS
What do you think about Disney extending CEO Bob Iger’s contract through 2026? Are you happy, disappointed, or indifferent towards the news? Recognize this as a ‘necessary’ move even if you’re not wild about it? Who do you think will be CEO of the Walt Disney Company on January 1, 2027? Will it be Bob Iger (still), Christine McCarthy (somehow), Tom Staggs, Kevin Mayer, Josh D’Amaro, or none of the above? Who should it be? Thoughts on anything else discussed here? Are you optimistic or pessimistic about the Walt Disney Company’s future? Think things will get better in 2024-2025? Do you agree or disagree with our assessment? Any questions we can help you answer? Hearing your feedback–even when you disagree with us–is both interesting to us and helpful to other readers, so please share your thoughts below in the comments!
Mr Iger did have political ambitions which he publicly said he would ignore at the time. He is a registered independent. Given the current unknowns of the upcoming Presidential race, Mr Iger has continued to make himself relevant and newsworthy well into the following cycle which has some strategic merit if he wishes to pursue politics after Disney.
The board, without having a ‘perfect’ replacement and being a bit shy of making another poor (Chapek) decision, may have just handed Iger a potential run at the Presidency.
This extension may have little to do with Disney at all in the long run.
Tom,
Another excellent analysis. But I believe that you have two mutually exclusive ideas.
On the one hand, you said, “Disney still has to “deal with” both Hulu and ESPN; the decline of linear as cable cord-cutting accelerates and ad revenue dries up; attempting to make streaming services profitable; paying down debt as a result of the 20th Century Fox acquisition; and that’s just a partial list of the huge headwinds facing Disney!”
That’s the ballgame.
That’s the future of growing versus declining earnings. Parks will always be fine. In fact, the Analysts have criticized the reliance of Park profits as the cash cow that currently feeds the injured beast.
On the other hand, your bias towards having a Parks-person run things. Chapek ran the Parks before being CEO, and yet he somehow destroyed the guest experience. He was promoted from within. And the current round of movies have been atrocious – with Chapek being known to being bad at ‘managing the talent’.
In the end, however, like you, I too believe that Iger remains the best person in the short-term to figure out how to fix what got broke – some of those failures were Chapek, and some came from Iger.
I agree with the entire article…. Moreover, If iger didn’t agree with all the price increases, he had the power to correct …. I know this is a thought from outer space, but what if Chapeck was hired to be the fall guy?… probably not, but he still came out pretty good financially…
At this point, I think the next CEO is likely to come from outside of the company. As much as it would be nice to have someone from Parks and Resorts in the top slot, Disney has always been a media company first and even if Iger started taking D’Amaro to every media meeting TODAY, I don’t see D’Amaro being ready to fly solo by 2026.
Tom, I’m curious if you have any thoughts on what the “solution” for ESPN is? If I’m remembering correctly you had been of the opinion that it should be sold off, is that still your stance? I read an article in Deadline recently about how when the actors go on strike and basically halt the production of scripted content, sports could be a key component that keeps Disney’s profits from tanking too severely in the short term.
My view on ESPN remains unchanged from this: https://www.disneytouristblog.com/potential-mergers-acquisitions-disney-bob-iger/
I do think *something* needs to happen, though; based on today’s CNBC interview (top post), it sounds like it will.
On the plus side, they are taking a wider view at all of the TV networks and channels. Most of the “linear networks” should be sold before or the same time as ESPN from a financial standpoint, and what they keep will probably be less general entertainment (think ABC, since that usually needs more sports and live entertainment to goose the ratings).
Iger’s contract renewal is unsurprising. He will be busy correcting all the mistakes he made. I just wonder how much better a position Disney would be in if Tom Staggs had taken over, instead of Chapek. How did Chapek ever get chosen? How was Staggs passed over?
At this point, I’m guessing Staggs refused to stay around indefinitely. It seemed like the plan when he was named COO in 2015 was that he was going to be Iger’s #2 for a year, but after 14 months Staggs left the company and Iger remained CEO until 2020. If that’s the case, then Staggs probably isn’t coming back if being Iger’s #2 again is a prerequisite.
Staggs was in strategic plans and finance, becoming CFO in 1998. After Iger chose him and Jay Rasulo to compete to be Disney’s next CEO, they swapped positions, so Staggs was head of Parks and Resorts for five years. (My personal opinion at the time as an outsider and a fan was that it seemed like he adapted well to creative.)
I used to forget that Mayer was being considered for CEO when Chapek was. From my point of view, being Chief Strategy Officer and head of Direct-to-Consumer and International were good experience but not enough to be CEO of Disney. (Chapek replacing Staggs at Parks and Resorts was a power move that greatly helped his resume.) What changed my mind was an excellent point Mayer made in an interview; the sudden retirement of Iger meant that a CEO had to be chosen right then and there. While he was succeeding and undoubtedly in line for a promotion, the quick decision meant Mayer was in a situation where his resume couldn’t yet beat Chapek’s.
At the time, it was suggested that Staggs was pushed out because the board didn’t think he had the disposition to be CEO. NextGen was definitely a misstep, and all of the big expansion that started under Staggs had not yet come to fruition. (The timing was really tough and unfavorable to him.)
Subsequently, details have trickled out suggesting that Iger wasn’t ready to let go and undermined Staggs. It’s similarly been suggested that Iger moved Chapek not as a power move, but as an insurance policy–Iger didn’t think Chapek had what it took to be CEO, which would allow him to extend again. All rumor, of course, but I think the events of the last ~3 years lend credence to pretty much all of that.
I wonder
Errr…knew it was coming but hoping the powers to be were smart enough to figure this one out after they proclaimed only 2 more years??!! I also wished there was a clawback cause for the last 10 years of his pay and bonuses, that alone would have paid for an expanded monorail or 5th gate. Cause like you said, all of these issues Disney had and has was started by Iger himself.
The next CEO will probably be an AI-controlled, audio animatronic Walt. It will usually know exactly what to do to please Wall Street, even in B-mode, which is just a plywood flat. But until then, I just don’t see them replacing Bob Iger again until there’s a lot less uncertainty about the theatrical business, the streaming business, the Florida business, etc.
I will take Bob Iger all day over Chapek so this is good news in my book
This is a situation where like it or not, Iger needs to stay on a bit longer. I’m not a fan of Iger by any means and feel as you stated, that he is dealing with the cards he partially dealt himself. But right now, I don’t know, and never will know given my total lack of expertise, of a person more qualified to run the company. I’m not going to defend Chapek, but he was left with quite a mess to deal with and the company’s partially self inflicted Covid wounds made things worse. Chapek was doomed. But that said, maybe Iger can work some magic one last time (as in a magic giant wallet) and get Staggs and Mayer back. Hopefully the company will start to steer clear of politics and divisive social issues going forward.
Tom
Congrats to you and Sarah. Thanks for sharing and I’m glad that both she and Megatron are doing well. I get Iger staying, especially after McCarthy’s departure. Given the uncertainty with debt and finances, why not do two CEO’s? A creative one and financial one. It worked well with Eisner and Wells. Even Walt had Roy.
Just gonna say that I can run this company into the ground and blame others for half the price they are paying this idiot. I would at least try to have the best interest for the company, its workers, and guests in mind, and not want to use it as a political platform to spew my own political beliefs, as I have zero desire to be president.
I thought it was notable that D’Amaro attended the Academy Awards with Iger this year. It felt very much like an opportunity to get him face time with Hollywood elite.
That said, I think that the next CEO (assuming the board isn’t just trying to kill time until cloning Iger is a viable option) needs to have a strong entertainment background as that was a major misstep (one of many, clearly) with Chapek. Film and TV savvy with an interest in theme parks. That’s why Tom’s dream scenario of Staggs and Meyers is so appealing. Unfortunately that bridge seems well and truly burned.
If they’re serious about D’Amaro they need to get him out of parks and increase his exposure to the film and TV side of the company, but they’ve flopped with succession planning so many times now that I think they’re scared of elevating someone to COO and not having it work out yet again.
They’ve worked themselves into a tough spot with trying to find an internal successor.
Great post, Tom. The main thought that comes to mind is that if Josh D’Amaro isn’t someone with “experience on the media side, able to handle potential M&A, cost-cutting, and other unpleasant tasks required,” then unless Iger plans to delegate some of these tasks and/or move Josh to a different executive position (this seems risky/unlikely) in an effort to groom him as a successor, Josh isn’t going to be any more prepared to take on the CEO role in 2026/2027 than he is today. And neither will anyone else from Parks & Resorts. If Josh wants to be a CEO, my feeling is that he’ll need to do it somewhere else first before he would ever be trusted to take the reins at Disney.
I think the final three paragraphs after the quote address that.
Failing that, Disney hasn’t been afraid to put leaders into different roles to broaden their experience/expertise. I don’t think that’s necessary here assuming all of the aforementioned issues are sorted out, but perhaps it wouldn’t be a bad idea.
With that said, bringing back Staggs and Mayer as a CEO/COO team is my dream scenario–and one where the top executives would be incredibly well-rounded.