In a bizarre Disney leadership shakeup no one anticipated or could see coming, Disney CEO Bob Chapek is OUT and former Disney CEO Bob Iger is back IN!
On a seemingly normal and quiet Sunday evening (November 20, 2022), news broke and quickly cascaded through the Disney universe. I wasn’t sure if it was real, nor could I confirm at that exact moment. But, there it was. The headlines said all we needed to know. “Chapek Out, Iger In”. And phones started lighting up as colleagues, friends and family started talking about and sharing the news.
It’s real…Here is the official press release.
Many of us woke up on Monday and thought “did I dream it?”. The news was still so shocking and unexpected.
So….What transpired to lead the Disney Board of Directors to make this decision? Didn’t they just recently claim they were happy with Chapek and had confidence in him going forward? Wasn’t his contract just renewed? I mean, most of us wanted this to happen. But HOW did it happen?
So many questions. So many factors. Where to even begin….
It’s been a wild ride since Bob Chapek took over the CEO reins in February 2020. I think the vast majority of Disney fans were not necessarily thrilled with the announcement at the time. And, unfortunately, Chapek did not do anything during his short tenure to prove Disney fans wrong or try to turn the tide in any way. He just continued to make one bad decision after another and bury himself deeper into a hole. And he never did rise above and take control for the role or responsibilities he had.
Was he dealt a bad hand or did he do this to himself?
That’s a hard question to answer. I personally think it’s a combination of both. There were so many things he could (and should) have handled better.
Let’s face it, Chapek took over as CEO just weeks before the pandemic hit, leading to the unprecedented closure of Disney Parks worldwide. I mean, who could have predicted that? No one. All corporations across the globe, including the pharmaceutical company I work for, struggled to understand how to deal with the new circumstances. Not easy. Especially for such a dynamic company as Disney.
For the Disney Corporation, it was even more of a challenge because first and foremost, they had to prioritize the safety of their Cast Members and Guests. And once they reopened, they had to continue to balance safety, as well as provide the high quality service that we have come to know and expect. This was no easy task.
I do think Disney navigated a no-win situation with a lot of grace and class, and handled the media and fans polarizing opinions on topics from the controversial reopening of Walt Disney World, mask mandates, social distancing, and vaccination requirements, to name a few. Let’s face it, in today’s world of social media, everyone in the public eye is under scrutiny. Disney and Chapek are no exception; this comes with the territory and job.
Changes were implemented to deal with the pandemic, like the introduction of park reservations for crowd control and subsequent sales of annual passes were paused to keep crowds low. It came with a lot of negativity and anger from Disney fans. In fairness, I think what was lost on the situation was similar actions were being taken in some capacity at almost every global corporation at the time. And like many other companies, employees were laid off.
It’s worth pausing here to note that during this challenging time, Bob Iger remained with the Disney Corporation as Executive Chairman on the Board of Directors. His role was to offer consultation and guidance to Chapek on navigating these rough waters. He remained in this role until December 2021.
The Struggles Continued
Chapek’s struggles didn’t just start and end with the pandemic though. His tenure was rocky with a series of missteps and fumbles that he could not recover from. From the very ugly public lawsuit with Marvel star Scarlet Johansson, to the criticism of Disney’s see-saw response to Florida’s controversial “Don’t Say Gay” bill, to the ongoing feud with Governor DeSantis over the future of the Reedy Creek Improvement District, he had a wide array of miscommunications and misfires that continued to bury him deeper in a hole.
Not only was Chapek’s internal reputation suffering, but he officially became the villain for Disney fans. An easy person to blame for all the wrongs. Public opinion started tipping the scales to a damaging degree. It got to a point where fans pinned and crucified him for every decision, unpopular opinion, how situations were handled at the parks – it didn’t matter. Everything was Chapek’s fault. Was it unwarranted or without cause? Was it too harsh? Fans made it very clear how they felt.
I will interject one thing here that I think is important for perspective. For whatever it is worth, when Chapek was Head of Parks and Consumer Products, long before he became CEO, he was not well-liked at all. He made decisions in that role that were very unpopular. And fans had already started the disdain for him and his poor decisions. So, as he stepped into the CEO role, his reputation already preceded him – and it already wasn’t very good.
Things started to go off the rails.
According to a WSJ article, the relationship between both Bob’s was tumultuous from the start. It seemed that Chapek often dismissed Iger’s consultation and guidance and felt he was overstepping his boundaries and undermining his authority. They soon had a falling out and the two drifted, rarely speaking to one another. Chapek pretty much cut him from all further discussions.
According to reports, Iger started to publicly state his error in judgment in placing Chapek at the helm, and vehemently claimed it was one of his worst business decisions. This quickly got back to Disney HQ. Chapek was furious. And in response, he decided to clean house. He spitefully fired many of Iger’s loyal leaders and replaced them with his own. He set new targets for the Disney Company, focusing primarily on the Disney+ streaming service.
Chapek Gets Re-signed
With Chapek’s contract renewal looming, many wondered if the Board of Directors would keep Chapek amid so much negativity. To many’s surprise, Chapek’s contract was renewed for three more years in June 2022 (until July 2025) and the Board publicly expressed their confidence in his leadership.
I personally wondered at the time if the Board’s public statement of confidence was a PR stunt to try to help his and the company’s image. I have never seen a Board of Directors come out so publicly and defend their CEO in this way, especially one that has caused so much havoc. Seemed a bit excessive and exaggerated to me.
But, we carry on…
To sum up the last few months of Chapek’s tenure…. the summer earnings report was good news. During the quarter, the Disney Parks division posted $7.4 billion in revenue and $2.2 billion in income. Things seemed to be trending on an upward trajectory and everyone seemed to be happier. Disney executives and the Board’s vote of confidence in Chapek seemed to be helping him turn things around. He even started stepping out in public, since he had spent most of his time hiding due to poor public image – not exactly great qualities of the CEO who should be a positive face of the brand. He even made a public appearance at the D23 Expo in September. I attended D23 and was in the room when he took the stage. I was actually shocked to see it. Could things be moving in a better direction?
Let’s not get too ahead of ourselves…
The fall earnings report was released in early November. Things took a turn for the worse. Disney’s streaming business lost $1.47 billion in the fourth quarter, more than twice the year-earlier loss. Since Disney+ launched three years ago, Disney’s streaming business has lost more than $8 billion. So while the Parks division continued to show record profits, you have to wonder if all this time the continued [and frequent] increased price hikes and all the paid upgrades were put in place to cover for the losses in other areas? Chapek tried to spin the negative numbers, but no one took the bait. He was highly
criticized for the way he handled the call. This seemed to be the final straw.
Mad Money star Jim Cramer weighed in and demanded Chapek be fired. This was not the first time he’s spoken out on the issue. “There is just no doubt that he has to go,” Cramer said. “The way he handled it, he made it sound like it was a four-star quarter. Delusional.” Discussion ensued within the financial world. Disney shares dropped 13% in the stock market – the lowest since March 2020.
Something had to be done. And fast. This was bad. Even senior leaders within the organization started to openly state their lack of confidence and support for Chapek.
It’s all about to change….
On Friday November 18th at 3 PM, Bob Iger received the call from Disney. Within 2 days, he was at the helm once again. Chapek was ousted. Asked to leave immediately. According to a connected source, “He didn’t get to say goodbye or say, ‘I’ve decided to step down,’” this person says. They called [Chapek] and said, ‘You’re out. Our lawyers will call your lawyers.’ No statement from him, no comment from him, no grace.” Pretty shocking when you read those words and realize how bad it actually got behind closed walls.
It’s a new dawn…
So, here we are… with new [or old] Disney leadership back at the helm. And Iger is not wasting any time. He’s already fired Kareem Daniel, Chairman of Disney Media and Entertainment Distribution, Chapek’s hire and right hand man. If that is not sending a message right out of the gate, I don’t know what is. And I’m certain in the days to come, there will be more disruption in the company as he tries to right the ship. He’s made very clear he is not happy with any of the decisions that Chapek made or the direction the company is moving.
But, let’s remember, Iger is not a long-term solution. He agreed to the CEO position for two years in order to prepare a successor to take the role permanently. So who will be the next CEO? That remains to be seen. I just hope this time Iger gets it right because the company and fans-alike do not want to see this happen again. It just simply can’t.
So what does all of this really mean… for you, for me, for the parks, for the Walt Disney Company?
That’s actually a loaded question. Without a doubt, it means things will return to what we know and love. Will everything come back exactly as we knew them, probably not. While most of us would like to see immediate changes and revert back to pre-pandemic Disney, this is not realistic. As fans, I think we need to set our expectations.
At the end of the day, Disney is a business that needs to operate and make money. Tools like Genie / Genie+ (which replaced the free FastPass) are very lucrative. And despite complaints, Guests are buying it and using it successfully. I don’t think we are going back to free FastPasses. What we might see is a change in the Genie+ functionality, or maybe even pricing. But I don’t suspect that is going away.
After all, Iger personally announced the Genie tool at the D23 Expo in 2019. So it really all started on his watch. It’s a good tool in its own right, it may just needs some tweaks.
What I think we might see in the immediate future is the return in sales of Annual Passes and possibly the removal or updates to the park reservation system and park hopping. It’s been rumored that these may be coming in early 2023. This is exciting news! Of all the things, my wish is that park reservations and the 2pm park hopping rule disappear – could my wish come true?
My thoughts on the actual Bob-swapping…
It needed to happen. I only wish it happened even sooner.
As a long-time fan (fan first above all else!) and Disney blogger / freelance writer, the constant negativity in the Disney universe became intolerable. It was difficult to find joy in any of it. There was a constant dark cloud over Disney and it had to change, for the benefit of the company, its Cast Members and its fans.
At the end of the day, in my opinion, despite this entire editorial, the real reason(s) behind why Chapek was fired don’t really matter. Does it make a great story? Absolutely! But, he had to go. Plain and simple. To save the image. To save the brand. The suffering was palpable. And for those of us that live and breathe in this crazy Disney space, we felt every bit of that. And it was a difficult burden to bear. Chapek’s vision and personality did not fit the brand that we know and love.
The minute the announcement was released on Sunday night, you could almost hear a collective sigh of relief across the Disney universe. The tone immediately shifted. There is joy, optimism, happiness and people are excited to see what the future holds. We haven’t felt this way in over 2 years. It’s been rough.
I am excited about the change. I look forward to seeing what’s in store for the future and honestly feel like we can’t go anywhere but up! We can all agree that we just want to see the company grow, be successful and bring back the “magic” that we all share and love.