Disney shares rise as Bob Iger makes sensational return as CEO

Bob’s House of Mouse bounce! Disney shares rise 10% in pre-market trading after Bob Iger makes sensational return as entertainment giant’s CEO and Bob Chapek is FIRED after clashing with DeSantis over ‘Don’t Say Gay’ bill

  • Disney stocks jumped 10 percent in premarket trading following the sudden announcement that former CEO Bob Iger would once again take over the helm
  • The company abruptly ousted CEO Bob Chapek, 62, after earnings plummeted under his reign 

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Wall Street celebrated Bob Iger’s sensational return to Disney’s CEO on Monday with a 10 percent jump in premarket trading after share prices fell more than 40 percent over the past year under ousted CEO Bob Chapek’s reign.

The company’s board of directors tapped Iger to ‘replace’ Chapek Sunday night, The Wall Street Journal reported, putting an end to the two-year reign of the new CEO who was once hailed as the Disney heir apparent.

The shakeup comes as an abrupt return to power for Iger, who had served as Disney’s head exec for more than 15 years before he stepped down in February 2020. He later stepped down as chairman of the board at the end of last year, receiving a compensation of $45.9 million.

Iger, 71, had long pegged Chapek as his successor, handing him over the keys to his kingdom in February – despite a slew of false starts that saw him continue to steer the company for more than two years after airing plans to retire – reportedly to the frustration of a waiting Chapek.

At the time, Iger, who famously caused ructions on his way out by forcefully speaking out against Florida’s so-called Don’t Say Gay bill, asserted his retirement was permanent, and that he would not return to the role.

But since Chapek, 62, took over the company has been struggling financially as the House of Mouse further mishandled its relations with Florida Gov. Ron DeSantis over the bill, which bars teachers of students in third grade and below from discussing sexuality. 

As a result, DeSantis decided to strip Disney World of its special tax privileges. 

The company has been slammed for becoming more woke in recent months, with scenes of a lesbian kiss in kids’ movie Lightyear, and a transgender man buying tampons in TV series Baymax – although those productions were likely signed-off during Iger’s tenure there.

Bob Iger made a sensational return as the Disney CEO on Monday, after stepping down last year

Bob Iger made a sensational return as the Disney CEO on Monday, after stepping down last year

Former Disney CEO Bob Chapek said he initially chose not to speak out against Florida's Don't Say Gay bill to balance the needs of customers and employees

Former Disney CEO Bob Chapek said he initially chose not to speak out against Florida’s Don’t Say Gay bill to balance the needs of customers and employees

Disney stocks rose more than 10 percent in premarket trading following the news on Monday

Disney stocks rose more than 10 percent in premarket trading following the news on Monday

 Chapek’s reign at Disney was originally hailed, as he helped the media giant through the COVID pandemic.

For fiscal year 2021, Disney posted revenue of $67.4 billion, up 3 percent from the year before, and net income of $2 billion following a net loss of $2.8 billion in 2020, when the pandemic hit. 

In its filing at the time, Disney executives said: ‘Mr. Chapek, as Chief Executive Officer, delivered strong performance given the unprecedented challenges resulting from the COVID-19 pandemic and meaningful shareholder value, driven by exceptional execution of the company’s key strategic initiatives.’

They said that since March 2020, when the pandemic arrived in the United States, Chapek has ‘adeptly managed the significant disruption of the company’s businesses resulting from the COVID-19 pandemic and guided the company’s new management team leading  to our direct-to-consumer efforts.’

And, they added, Chapek ‘took meaningful and innovative steps at our parks and experiences business, while reopening our parks, including the development of Disney Genie and new Magic Key offerings.’ 

With Iger still serving as the chairman of the board through December of last year, the company’s stock climbed to just above $200. 

At the time, Variety reports, Chapek saw his compensation package hit around $32.5 million, while Iger more than doubled his intake with a compensation package worth $45.9 million — up from $21 million the year before.

Iger also received $3 million in salary for Fiscal Year 2021, up from $1.6 million the year before. And his compensation included a $22.9 million cash bonus, plus $9.5 million in Disney stocks and another $9.3 million in stock options.

That does not include the stock Iger was entitled to receive when his contract expired at the end of the year. 

But the company has been struggling in recent months, announcing in its fourth-quarter earnings report earlier this month that while its streaming platform, Disney+, added 121 million new accounts, its streaming business lost $1.47 billion — more than twice the year-earlier loss, the Wall Street Journal reports.

CFO Christine McCarthy also tempered investor expectations for next year by forecasting growth of less than 10 percent.

In the aftermath, Chapek vowed to cut costs through hiring freezes, layoffs and other means.

It remains unclear whether the company will move forward with the potential layoffs under Iger’s rule. 

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