Robert Iger will be the new CEO of the Walt Disney Co.
Susan Arnold, the board chair, said, "We thank Bob for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the Pandemic." Disney is embarking on an increasingly complex period of industry transformation and Bob Iger is uniquely positioned to lead the Company through this crucial period.
Iger was Disney's CEO from 2005-'20 and also served as chairman of the board. Disney rebuilt itself as a media powerhouse under his leadership, with the acquisitions of Pixar, Lucasfilm, and 21st Century Fox.
Arnold said that Mr. Iger has the deep respect of Disney's senior leadership team, most of whom he worked closely with until his departure as executive chairman.
Disney's shares jumped 8% before the market opened.
Disney shares have fallen about 11% since June, and are down 42% year to date, compared to the 5% decline this year by the DJIA, of which it is a component.
Disney made it clear that Iger's return will be temporary with a mandate from the board to set a new direction and develop a successor.
Dan Ives, an analyst for the firm, said on Sunday night that it was "WOW". He said that his return is a major strategic move with ramifications for the media and streaming industry.
Disney said at the time that Iger would continue to direct the company's creative endeavors after he stepped down.
Earlier this month, Disney stock suffered its worst day since 2001 after the company in its fourth-quarter earnings report forecast significantly softer-than-expected, single-digit growth in the coming fiscal year.
Disney had its best year for revenue growth in more than a quarter century. Disney's largest business segment, media and entertainment distribution, suffered a sharp drop in sales during the third year of the COVID-19 epidemic. Disney+ is a money-loser despite its rapid growth. A cheaper tier will be added in December in order to increase revenue.
According to the Wall Street Journal, Disney is planning to cut costs, including a hiring freeze and layoffs. According to an internal memo, Chapek said that they were going to have to make difficult decisions.
Disney came under fire for their response to Florida's "Don't Say Gay" law. He stopped the company's political donations in Florida after expressing his concerns to the governor. Many Disney employees walked out of work to protest what they said was Chapek's lackluster response. He apologized to the employees.
In June of this year, Disney extended Chapek's contract for three more years, with Arnold saying he had the board's "full confidence."
The decision to stream new movies on Disney+ the same day they hit theaters drew a lawsuit from actress, who claimed the decision cheated her. The suit was eventually settled.
CNBC reported in March that Iger and Chapek had a falling out and rarely spoke, and that there was significant internal tension caused by Chapek making important decisions without Iger's input. One source said it was awkward.
In a recent interview with Kara Swisher, Iger said he couldn't go back to Disney.
Iger said he was excited to come back.
Iger said he was excited to return as the company's CEO. Disney and its incomparable brands and franchises hold a special place in the hearts of so many people around the globe, and especially in the hearts of our employees, who are dedicated to this company and its mission. I am honored to once again lead this remarkable team, with a clear mission to inspire generations through bold, creative stories.
The change in leadership has created uncertainty with the company's big strategy shifts ahead.
The near- to medium-term implications to shares will depend on what path Iger will take to deliver on his mandate for renewed growth.
It might be difficult to execute against a wide-ranging set of initiatives, as well as managing the murky macro backdrop and supporting work on succession planning, because his term is only for 2 years.
A person contributed to this report.
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