The past couple of days have been pretty bad for the markets overall. With new coronavirus cases popping up in unexpected countries like Italy, the U.S. markets, in particular, fell by over 6% over the past two days. While most stocks have been hit by this, Disney (NYSE: DIS) ended up falling even further today when the company announced that its long-time CEO, Bob Iger, will be stepping down immediately from his position at the company.
In an official company announcement, Disney said that Bob Chapek, who recently was the chairman of Disney parks, experiences and products, will be taking up the position of CEO immediately. While Iger will no longer be CEO, he will still remain executive chairman, with Chapek continuing to report to Iger as the transition continues. In this position, Disney’s former CEO will remain as executive chairman at least through the end of 2021.
During a call with investors following the announcement, Iger went on to confirm that his departure has been a long time coming and that he is expecting to fully retire by 2021. He also said that he wants to spend his time on other creative projects now that major corporate projects, such as the launch of Disney+, have concluded.
“With the successful launch of Disney’s direct-to-consumer businesses and the integration of Twenty-First Century Fox well underway, I believe this is the optimal time to transition to a new CEO,” Iger said in a statement. “I have the utmost confidence in Bob and look forward to working closely with him over the next 22 months as he assumes this new role and delves deeper into Disney’s multifaceted global businesses and operations, while I continue to focus on the Company’s creative endeavors.”
Shares of Disney ended up falling 3.6% over the course of the day, followed by an extra 3.5% decline in after-hours trading following the news. Bob Iger played a significant role in transforming Disney and making it a much more diversified service provider. This includes offering a major streaming service, Disney+, as well as helping facilitate major acquisitions including the Fox merger. Investors are justifiably concerned about how Bob Chapek will run the company and how he will hold up in comparison to his predecessor. Before this announcement, analysts were overwhelmingly optimistic about Disney’s future as a company.
Walt Disney Company Profile
The Walt Disney Co owns the rights to some of the most globally recognized characters, from Mickey Mouse to Luke Skywalker. These characters and others are featured in several Disney theme parks around the world. Disney makes live-action and animated films under studios such as Pixar, Marvel, and Lucasfilm and also operates media networks including ESPN and several TV production studios. Disney recently reorganized into four segments with one new segment: direct-to-consumer and international. The new segment includes the two announced OTT offerings, ESPN+ and the Disney SVOD service. The plan also combines two segments, parks and resorts and consumer products, into one. The media networks group contains the U.S. cable channels and ABC. The studio segment holds the movie production assets. – Warrior Trading News
