The Return of Bob Iger, and Where Disney Goes Next

An Unexpected Change

In a surprise move, Disney’s (DIS) board of directors voted to replace CEO Bob Chapek with longtime CEO Bob Iger, who just left the company late last year. Meanwhile, the company is at a crossroads, having fallen short of sales expectations in its fourth quarter.

The disappointing results halted a period of momentum for Disney, with revenue and profit up in previous quarters. Its amusement parks had been one of the company’s biggest bright spots, having bounced back in a big way following pandemic-related shutdowns.

Meanwhile, the company’s efforts in streaming continue to cause headaches. While Chapek has predicted the Disney+ unit will be profitable by September 2024, it just posted a $1.47 billion loss — which is double the loss recorded in the year-ago period.

Boomerang Bob

Iger, who served as Disney’s chief executive from 2005 to 2020, now joins the ranks of other so-called boomerang CEOs. The term refers to executives who reassumed their previous positions at the same companies. Prominent examples include the late Steve Jobs, who founded Apple (AAPL) and later returned at the helm, as well as Starbucks (SBUX) CEO Howard Schultz — who has now returned on two separate occasions.

By definition, the returning executive’s job is not an easy one. Their return is usually indicative of some problems. Boomerang CEOs also have a mixed record. While Jobs’ return helped Apple grow into a consumer electronics giant, former Chipotle (CMG) CEO Steve Ells’ efforts to rebuild trust in the brand after a series of scandals largely failed. He stepped down again one year later.

What’s Iger’s Agenda?

Bob Chapek and Bob Iger have publicly disagreed on their approaches to streaming. Iger favors lower pricing for the platform, in a bid to undercut its competition. But Chapek boosted the price without ads in December of last year. With the recent Disney+ loss, it’s possible Iger looks to cut back these prices. Meanwhile, both expressed a willingness to move forward with the complete acquisition of streaming platform Hulu, which could happen in January 2024. (Disney is the sole operator of Hulu currently, but media rival Comcast still owns a minority stake.)

Reports say Iger also privately disagreed with Chapek’s handling of legislation aimed at LGBTQ+ instruction in Florida schools, which put the company at odds with the Sunshine State, where Disney World is located. So his return could focus on both corporate policy and public image — a double whammy fit for a boomerang.

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