Via DisDining.com
When Bob Iger announced that he would be stepping down as CEO of The Walt Disney Company, he promised that there would be a smooth transition as Bob Chapek took over the role. Well, one pandemic, thousands of layoffs, multiple theme park shutdowns, Cast Member strikes, and multiple lawsuits, the past nearly two years have been anything but smooth.
Unfortunately, company executives and shareholders are seeing that things are quite rocky and are leaving and selling their shares to get out. According to a new report from Bloomberg, company stocks have tumbled 16% this year, and the investment company Morgan Stanley says that Disney is suffering from a “crisis of confidence.”
Wall Street, meanwhile, is growing skeptical that the company’s flagship streaming service, Disney+, will hit Chapek’s target of as many as 260 million subscribers in 2024. Disney shares are down about 16% this year, heading toward their worst annual performance since 2008. Morgan Stanley said the stock is suffering from a “crisis of confidence.”
“The biggest problem that Disney is facing is Disney+ right now,” said Porter Bibb, a veteran media investor. “It’s not a profit segment. It’s kind of stalling in terms of subscribers. And it’s a question mark whether you can put a supremely popular and winning streamer together with comic book characters that keep getting recycled over and over again…
Bill Smead, a Phoenix-based money manager who has owned Disney stock for 20 years, recently sold all of his 191,747 shares. He thinks Chapek will have a tough time delivering the kind of returns Iger did.
“You never want to be the coach who follows John Wooden,” Smead said, referring to the UCLA basketball legend.
While Disney+ subscription numbers have not climbed as high as the company would have liked, they are still banking on drawing more people in as they add more original programming on the Disney, Marvel, and Lucasfilm ends. Disney recently announced at a shareholder meeting that between Disney+, ESPN+, and Hulu, the company has approximately 180 million subscribers.
Bob Iger’s last day at The Walt Disney Company is December 31, 2o21, and 2022 will mark the first time that Chapek will take the reins on his own, so it remains to be seen whether he can bring back the confidence that the Disney name once instilled in the stock market and shareholders.
