After contract renewal, Disney CEO Bob Chapek seeks to prove that wishes can come true with him at the helm of the ship

Walt Disney CEO Bob Chapek has received praise in many corners in 2020 for skillfully leading the company through the devastation of Covid after taking over from Bob Iger at the start of that fateful year.

The year and a half since has seen many more twists and turns, with Disney’s sharp drop in share price partly reflecting lingering questions over the future of the seventh person to hold the job. of CEOs in the company’s 99-year history. He publicly clashed with Scarlett Johansson over the release of Black Widowousted highly respected executive Peter Rice with minimal explanation and fumbled — by his own admission — the company’s response to Florida’s “Don’t Say Gay” legislation.

Earlier today, however, Chapek was granted a three-year contract renewal by Disney’s board. The announcement of the widely anticipated renewal capped a two-day board meeting. On Wednesday, the new boss will be back in his element, presiding over a christening ceremony for the Disney Wish in Port Canaveral, Florida. The cruise ship will embark on its maiden voyage on July 14.

Her development and construction overseen by Chapek during his tenure as head of the company’s theme parks and resorts division, Wish is the first new cruise ship to join the fleet in the past decade. . It incorporates themed food attractions and other expansions of the company’s mighty Marvel, Frozen and star wars brands, as well as a “1923” area dedicated to the year the company was created. “He’s really his baby,” a longtime former colleague of Chapek told Deadline. “Welcoming this ship on the company’s centenary will be his chance to reset the narrative. Parks, cruise ships, that’s been a real specialty. That’s where he feels comfortable . »

Prior to renewing his contract, President Susan Arnold issued a statement affirming the board’s confidence in Chapek, shortly after Rice’s dismissal. Canning a senior executive wouldn’t usually justify such an admission, but it followed a bumpy time. The council met behind closed doors but had a full list of topics to cover, from the C-suite to politics to streaming.

“If the board has to publicly throw its support behind it, that means something is wrong,” said a Wall Streeter referring to Arnold’s public statement, which said the company’s strength After the Pandemic” is a testament to Bob’s leadership and vision for the future of the business. During this important time of business growth and transformation, we are committed to keeping Disney on the path to success on which it stands today, and Bob and his management team enjoy the support and trust of the Board of Directors.

No one is claiming Chapek’s elevation to the top job — a surprise to Hollywood and Wall Street — came at an agonizing time, in February 2020, with the pandemic poised to shut down global affairs. The Indiana native, who began his career in advertising and also had long executive stints in consumer products and home entertainment, took over with a three-year contract that was due to end in February 2023.

“Granted the timing was bad and the industry was in flux and the question was, ‘Is he able to step up? It requires a politician, an executive and a creative, ideally,” the Wall Streeter said. But “Bob doesn’t have a natural constituency. People don’t know him on the street. When he was named CEO, investors didn’t know him, and then the pandemic made it impossible for him to get out and meet people. It is therefore still somewhat unknown. I don’t know who defends him.

The legal tussle with Johansson (settled weeks after it went public) and the perceived dithering around Florida’s so-called Don’t Parental Rights in Education bill (dubbed “Don’t Say Gay” by the opponents) have both tarnished his reputation as a leader. Disney became Florida Governor Ron DeSantis’ punching bag and lost a special economic zone after Chapek spoke at the annual meeting in March – but not before alienating many employees with his public silence.

“As an investor, I have my own opinions, and that doesn’t seem relevant to me,” the Wall Street vet added. “But it was definitely a big problem internally. Your first job as a CEO in a creative company is to motivate and energize people. The Rice episode, which snuffed out the run for the company’s entertainment chief without the usual severance gift of a production deal or the estranged executive being allowed to announce his own exit, also offended many employees. It followed a long period of speculation that Rice, a longtime Fox deputy who joined Disney after the $71.3 billion acquisition of most of 21st Century Fox, might be a legitimate candidate to take on the reins as CEO.

More recently, Disney gave away expensive rights to hugely popular streaming cricket in India, blocking linear rights instead. Given the company’s stubborn insistence as recently as May that it will hit its goal of 230-260 million global Disney+ subscribers by the end of fiscal 2024, one s expect the company to reduce this forecast. Even though Wall Street recently considered subscriber numbers the most important metric, any cuts will run counter to the norm in the streaming race, where the bar is raised. “That’s really the dilemma,” says a former Disney streaming executive. “If you reduce the number, will the street react like it did with Netflix? But if you don’t adjust expectations and you don’t reach the goal in two years, the pain could be even worse.

Light yearthe last movie of the toy story frankness, turned out to be a disappointment. On the bright side, Shanghai Disneyland is set to reopen amid a vigorous park recovery.

The stock was lackluster. After slipping a fraction in the normal trading day, it rallied a fraction in after-hours trading on contract news. Still, its current price of $96.59 is near the low of $92 for the year and nearly half of the roughly $188 it was trading last fall at its 52-week high.

Disney will release its fiscal third quarter results in August and the company’s shareholders’ meeting will be held in March. Disney, unlike other major media groups, is not a controlled company with massive positions held by family trusts and insiders. The 2004 meeting remains a milestone for the company, as it was the beginning of the end for former CEO Michael Eisner. Activist shareholder Roy Disney joined other shareholders in stripping Eisner of his position as chairman of the board. He resigned as general manager six months later.

Even though he has a new contract, if Chapek were to incur any discontent on the board, it is possible for him not to serve his full term.

“I haven’t heard any rumors about anyone actively running, campaigning against him,” the Wall Street source pointed out, as to Eisner, though filmmaker Abigail Disney, Roy’s daughter and little one -niece of Walt, spoke out against Chapek’s most recent salary. package. The Disney heiress is “doing her thing. It’s not like there was anything structural, that he made a big mistake. It just didn’t go smoothly.

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