Tag: Walt Disney Company

Via DisDining.com

In a move that was expected — but not necessarily popular — The Walt Disney Company’s Board of Directors has voted unanimously to extend Disney CEO Bob Chapek’s contract by 3 years. We had reported earlier that the Board was planning on extending Chapek’s contract at either their meeting this month or at their meeting in September, and we are now learning they chose to jump on it now. Chapek’s contract was set to expire in February 2023, but will now expire in 2026.

The vote was reported by Business Wire, which also shared a statement from Susan Arnold — the chairman of the Board. According to Business Wire: 

Bob Chapek also shared a statement after his contract was renewed, saying:

The move to renew Chapek’s contract may come as an unpopular one. Chapek has struggled to be seen in a positive light since he became CEO in 2020 — just one month before the theme parks were forced to shut down because of the pandemic. Chapek has made a number of controversial moves, including consistently raising prices, while many think he is cutting food portions and cleanliness standards. He also allowed the company to engage in a public spat with Marvel star Scarlett Johansson when she sued Disney for breach of contract.

Recently, Chapek spoke out against Florida’s Parental Rights in Education Bill — which angered those who supported the bill. Others remained upset with Chapek because they felt he didn’t speak up soon enough — going so far as to call the issue “irrelevant” to the company. And then, in a move that shook Hollywood, Chapek fired Executive Peter Rice — who many saw as a threat to his position as CEO.

Couple all of those things with the fact that Disney stock has gone dropped more than 40%, and you had a lot of people hoping that the Chapek years were coming to an end. Abigail Disney has spoken out against Chapek numerous times and has said that she wants to join with other shareholders to reduce Chapek’s paycheck, but with this contract renewal, it looks like that fight may be over.

On June 9, The Walt Disney Company dropped a major bombshell when it was announced that Peter Rice — Chairman of Disney’s Entertainment and Programming — had been fired. Prior to his role at Disney, Rice had been an executive at 21st Century FOX, which was purchased by The Walt Disney Company in 2019. According to sources close to Rice, he was completely blindsided by the decision, which was made by Disney CEO Bob Chapek. The source said that Rice was not given a real reason for his firing and was told by Chapek that the decision was not personal.

Rumors had been swirling that Rice was in line to possibly take over Chapek’s position as CEO when Chapek’s contract ran out, something that will happen in 9 months. There were also reports that Rice was “angling” for the role, and his desire to be CEO of Disney was not a secret. Some feel that Chapek fired Rice as a way to get rid of someone he considered competition.

However, it does not look like Disney’s Board of Directors feels that same way. Susan Arnold, the Chairperson of Disney’s Board of Directors, made the following statement after Rice’s exit was announced:

The strength of The Walt Disney Company’s businesses coming out of the pandemic is a testament to Bob’s leadership and vision for the company’s future. In this important time of business growth and transformation, we are committed to keeping Disney on the successful path it is on today, and Bob and his leadership team have the support and confidence of the Board.

After Rice’s firing, it was announced that Dana Walden — another former FOX executive — would be taking over the role of Chairperson of Disney Entertainment and Programming. Rice had a contract that was set to expire in 2024 and Disney said that they will continue to pay out that contract until it is up. Before being made Chairperson of Disney Entertainment and Programming, Walden had been the Chairperson of Walt Disney Television.

Since he became CEO in 2020, Bob Chapek has struggled to gain the favor of Disney fans. Tens of thousands of people have called for the CEO’s ouster for years and have even signed a Change.org petition, which has well over 100,000 signatures, to have him fired. Every time Disney fires a higher-up at the Company, many people comment that Chapek needs to be the one to go.

There were rumors that the Board was considering firing Chapek when his contract expires, but with the firing of Peter Rice, it is looking less likely that that will happen.

During The Walt Disney Company‘s fiscal second-quarter earnings call last week, the company revealed its success in streaming subscriptions to Disney+, but Mickey missed the mark in at least one area, thanks to a more than $1 billion loss related to an early termination of licensing agreements.

The earnings call, in which Disney CEO Bob Chapek and Disney CFO Christine McCarthy participated on Wednesday, was full of the usual for the quarterly call presented by Disney C-level execs against a backdrop of Wall Street‘s finest and listened to by shareholders and interested fans: Chapek referenced “stories” and “storytelling” perhaps more frequently than necessary as he gave an overview of the company’s quarter, and McCarthy followed with scores and scores of figures and numbers.

At least a handful of those figures and numbers stood out to interested parties, the first being the phenomenal growth in numbers of Disney+ subscribers: growth that beat even Wall Street‘s projections. The dynamic C-level Disney duo shared details during the call that painted a picture of Disney’s thriving business, including details about parks attendance on days inside the second quarter, some of which exceeded pre-pandemic demand in the parks.

McCarthy said that Disney continues to “control attendance” to allow for a “quality Guest experience” for everyone.

In Disney’s Parks division, sales more than doubled from $3.1 billion to $6.7 billion, and the division reported an operations profit of $1.8 billion, a welcome number, especially compared to a $400 million loss in the second quarter of Fiscal year 2021. The Parks division can thank Disney’s domestic parks for the uptick in operating profit; even CEO Bob Chapek referred to the U. S. parks—Walt Disney World and Disneyland Resort–as “standout” parks, saying that part of the good news for that division could be attributed to Disney’s new Lightning Lane and Disney Genie offerings for Guests.

Earnings per share of 26 cents saw a decline from 50 cents. EPS was $1.08, an increase from the previous quarter‘s 79 cents.

But Disney’s major loss during the second quarter was in its streaming service, but it wasn’t because of a drop in Disney+ subscriptions. Rather, the company amassed a more than $1.02 billion loss because of an early termination of “license agreements for film and television content delivered in previous years” that it has chosen to use on its direct-to-consumer services.

While Disney’s earnings report didn’t specify which content had been pulled back, Disney CFO Christine McCarthy said during the earnings call with Wall Street that those deals were books as revenue when the agreements were made, so they had to be pulled back from the numbers when Disney terminated the agreements.

Disney is one of several streamers making the decision to take back their own content. Six of Marvel’s original series for Netflix, Daredevil, Jessica Jones, Luke Cage, Iron Fist, The Punisher, and The Defenders limited series, as well as Marvel’s Agents of S.H.I.E.L.D., which had been streaming on Netflix only, are set to move to Disney+ beginning May 16.