{"id":34928,"date":"2023-07-13T01:12:13","date_gmt":"2023-07-13T05:12:13","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/opinion-bob-igers-repairs-at-disneys-crumbling-castle-need-more-time\/"},"modified":"2023-07-13T01:12:14","modified_gmt":"2023-07-13T05:12:14","slug":"opinion-bob-igers-repairs-at-disneys-crumbling-castle-need-more-time","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=34928","title":{"rendered":"Opinion: Bob Iger\u2019s repairs at Disney\u2019s crumbling castle need more time"},"content":{"rendered":"
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Repairing the crumbling castle that is the Walt Disney Co. is turning out to be a more complex and longer-than-expected job for Bob Iger. <\/p>\n

Last November, Iger returned as Disney\u2019s chief executive with a two-year contract that would have ended in December 2024. At the time, Wall Street investors were overjoyed with the news of his comeback, with one analyst\u2019s note proclaiming \u201cThe Magic is Back.\u201d<\/p>\n

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From November: <\/strong>\u201cSteve Jobs Syndrome\u201d strikes as Disney brings back Bob Iger<\/p>\n

Late Wednesday, Disney
\n DIS,
\n +0.74%<\/bg-quote>
\n announced that Iger\u2019s contract has been extended until December 2026, and the company also noted that the board\u2019s vote to extend his contract will provide continuity of leadership and give them more time for \u201ca CEO succession plan.\u201d<\/p>\n

Rich Greenfield, a partner with LightShed partners, said on Twitter<\/a> that he had predicted this would happen. In early 2023, Greenfield wrote in a blog post of predictions for the year that Disney would extend Iger\u2019s contract until 2027, because one of the entertainment giant\u2019s biggest problems has been the declining quality of its content.<\/p>\n

\u201cDisney\u2019s biggest challenge is that its IP\/content creation has been underwhelming over the past few years \u2014 especially its animated content,\u201d Greenfield wrote. \u201cPixar and Disney Animation have not had a breakout hit that impacted children\u2019s play patterns and both Marvel and Lucasfilm feel increasingly tired from overuse.\u201d<\/p>\n

He also noted in post late last month that a projected lengthy turnaround time of its lifeblood content business is only going to be extended by the ongoing Writers Guild strike in Hollywood.<\/p>\n

\u201cDisney may not have a single $1 billion global box-office film released in calendar 2023,\u201d Greenfield wrote in late June.<\/p>\n

In its fiscal second-quarter earnings report in May, the company reported that it lost 4 million Disney+ subscribers, while cutting some losses at the streaming business. That news, however, began a downward trajectory for the stock, which has lost about 10% of its value since then. Wall Street analysts have become more negative recently about the stock, lowering their price targets or ratings. <\/p>\n

Among the host of other issues at the Magic Castle: smaller crowds reported at its theme parks this summer; a lukewarm debut of the latest Indiana Jones movie; a potential rocky future for its ESPN service as a stand-alone streamer; and the Disney+ streaming business still struggling to become profitable. On top of these challenges, the company\u2019s well-regarded chief financial officer, Christine McCarthy, stepped down last month to take a family medical leave, replaced on an interim basis with the CFO of the company\u2019s parks unit, Kevin Lansberry.<\/p>\n

\u201cWith the recent exit of CFO Christine McCarthy, Disney was facing two senior executive searches,\u201d said TD Cowen analyst Doug Creutz in a note titled \u201cThe Indispensable Man.\u201d \u201cPushing out Iger\u2019s departure date makes even more sense in that context,\u201d he said, adding that Disney\u2019s \u201cchallenges are structural in nature and not easily solved.\u201d<\/p>\n

As with most construction projects that take longer than expected, repairs at Iger\u2019s Mouse House are going to take much longer than his initial two-year contract indicated. Hopefully by that time, a new leader will also be in place to succeed him.<\/p>\n<\/p><\/div>\n<\/div>\n