Bob Iger Returns/Disney CEO Thread (2022)

[SkiBum]

I definitely predicted the coronavirus concerns on the company at the time and I was certainly not the only one speculating that had to be the “why now?” and “why so abruptly?”

This was February 25, 2020, the same day he stepped down. COVID had already made its way to the US.

You summed up their problems succinctly in your entire post. I'm not defending Chapek but he was not put in a position to succeed by any means. It all reeks of arrogance.

 

[UniversalRBLX]

Chapek 100% was placed to take the fall and keep Iger's reputation high... which has fallen quickly surprisingly.

 

[Mad Dog]

I've always been intrigued by those theme park bloggers that designate one of the Bob's as the 'good Bob', and the other Bob as the ' bad Bob'. From what I've seen from both of them, especially in relation to their treatment of the USA theme parks, they are both 'Bad Bobs'.

 

[HORRORable Commenter]

I've always been intrigued by those theme park bloggers that designate one of the Bob's as the 'good Bob', and the other Bob as the ' bad Bob'. From what I've seen from both of them, especially in relation to their treatment of the USA theme parks, they are both 'Bad Bobs'.

But I need to have a parasocial relationship with a CEO billionaire that exploits their workers! I mean, why else get into theme park discourse if not to heap praise on monopolistic entrainment conglomerates that only care about the bottom line. I love disney parks and the creative work they can supply, but there was never a good Bob. We knew this since Disneywar. He never took the blame for Who wants to be a Millionaire and his statements against SAG and WGA only show that any sense of accountability left long before he was at ABC.

 

[Viator]

Disney Stock Dips Into $70 Range for First Time Since COVID-19 Selloff

Stocks of The Walt Disney Company continue to slide, reaching into the $70 range for the first time since the COVID-19 selloff

blogmickey.com

 

[Mad Dog]

Just speculating.....,Internally, Disney is probably seeing signs of a really bad fourth quarter (ends Sept 30). Yesterday they announced a huge discount on the Advertising Disney + subscriptions. That seems to me to be a red flag that subscriptions are running behind projections, and they need some numbers to make the Disney + subscription count look decent to investors. But, with that huge discount to attract new subs, the numbers will be a 'sham'. And, if anyone ever noticed, Disney fourth quarter results are often very central to the management decisions they make in Q1 for the next year. There's going to be a lot to watch in the next few months.

 

[rageofthegods]

Just speculating.....,Internally, Disney is probably seeing signs of a bad fourth quarter (ends Sept 30). Yesterday they announced a huge discount on the Advertising Disney +. That seems to me to be a red flag that subscriptions are running behind projections, and they need some numbers to make the Disney + subscription count look decent to investors. But, with that huge discount to attract new subs, the numbers will be a 'sham'. And, if anyone ever noticed, Disney fourth quarter results are often very central to the management decisions they make in Q1 for the next year. There's going to be a lot to watch in the next few months.

Also worth noting that both of their big July tentpoles (counting Indiana Jones) flopped hard.

 

[Nick]

Disney needs to figure it out. Disney+ really did torpedo this company, didn't it?

 

[Jerroddragon]

I've said this before but they should partner with Theaters and have Disney Plus Films like Chip and Dale/Hocus Pocus 2 first two weeks on the App and in Theaters. Along with showing off episodes from TV series, like the two part Premiere of Ashoha and the last two episodes

I know these wont make HUGE bank but it's something. Disney Plus Will NEVER make profits, period. So along with throwing anything they can into theaters, honestly it would be better to just keep the price low and make less content for it but witht he amount of shows like Simpsons/Bob Burger you can have on TV and then just on the service, along with movies that came out a few months before and a few "exclusive content"

But they need to make less content and make each thing they make a master piece, they are just too thin and it's hurting the brand's like the MCU and Star Wars the most.

 

[Mad Dog]

Disney needs to figure it out. Disney+ really did torpedo this company, didn't it?

Good analogy. and....the future earnings potential of Disney+ is not promising, regardless of the rosy public projections Disney likes to make. It's a big nasty black hole. But, unfortunately, Disney is being very stubborn about the entire streaming profitability, struggling in quicksand. Refusing to accept the reality.

 

[HandsomePete]

Interesting article, but I really love it when articles have bits about private conversations where only two people could really be the source, like:

Iger told Chapek that he lived for those “two-shower days,” according to people familiar with the conversation.

He called Iger and told him he didn’t need a savior, dropping a carefully placed expletive or two, according to people with knowledge of the call.

Might as well just list Bob C as the source.

 

[belloq87]

"People with knowledge of the call" can usually be read as "One of the parties directly involved in the call."

 

[HORRORable Commenter]

"People with knowledge of the call" can usually be read as "One of the parties directly involved in the call."

Bob said that Bob told Bob that he didn't need Bob to come in as a saviour, and that he, Bob, knew that Bob was looking to take the job back from Bob.

Bob. Bob. Bob.

 

[Grabnar]

Disney needs to figure it out. Disney+ really did torpedo this company, didn't it?

Building it from the ground up + the Fox merger did, at least. I think the $71B deal (which is currently HALF of their market cap lmao) really did them in. Colossal F' up that's going to be studied to death in MBA circles for decades.

Bob got his legacy.

 

[Mad Dog]

Building it from the ground up + the Fox merger did, at least. I think the $71B deal (which is currently HALF of their market cap lmao) really did them in. Colossal F' up that's going to be studied to death in MBA circles for decades.

Bob got his legacy.

Combination of the two, Plus and Fox. Upper cut to the chin and then a kick in the balls.

 

[Grabnar]

Combination of the two, Plus and Fox. Upper cut to the chin and then a kick in the balls.

I think Disney+ could've been a good move if they'd leveraged their existing assets in Hulu, bought it out, and added it on as an up-charge (hence PLUS). Basically pay for the Disney vault and a little bit of programming. A lot of your costs starting up a streaming service are in infrastructure and backend work which they really did not need to do at all. It's truly a baffling sequence of decisions.

 

[Mad Dog]

I think Disney+ could've been a good move if they'd leveraged their existing assets in Hulu, bought it out, and added it on as an up-charge (hence PLUS). Basically pay for the Disney vault and a little bit of programming. A lot of your costs starting up a streaming service are in infrastructure and backend work which they really did not need to do at all. It's truly a baffling sequence of decisions.

That still would not have worked. The economics don't add up, in a positive way. Streaming has only worked well for Netflix because investors look at it as a 'high tech growth', not media, stock. So lots of money got thrown at them even though they rarely posted a reasonable profit. Streaming just can't replace the numbers that non streaming home entertainment put up. Streaming subscriptions are way too cheap. They really need to charge many times over what they do to be profitable. But now they can't because there's too many players. They've boxed themselves into a corner, and there's no way out. Those in the know warned the studios that this would happen, but the studio execs. never understood, or wanted to understand, the dynamics of the home entertainment market as it existed before streaming was embraced wholeheartedly.

 

[Galactus]

What do you define as "reasonable profit"? Netflix has posted a yearly net income greater than 1B since 2018 and north of 4B for the last two years (source). Tech certainly has a lot of losers that will sell $1 for 90c and say that they'll make it up in volume but Netflix doesn't seem to be one of them. You might say that that's only been going on for 5 years and that won't hold. Maybe so, but I'm a little more bullish given that I expect more and more players in streaming to realize that it's hard and that it's easier to make money licensing your stuff to others instead of running your own. Now granted, I do agree that NFLX is being treated like a tech growth stock with a PE of 50+ vs an average S&P P/E of ~30 but I think the unit economics of NFLX are solid.

 

[Grabnar]

That still would not have worked. The economics don't add up, in a positive way. Streaming has only worked well for Netflix because investors look at it as a 'high tech growth', not media, stock. So lots of money got thrown at them even though they rarely posted a reasonable profit. Streaming just can't replace the numbers that non streaming home entertainment put up. Streaming subscriptions are way too cheap. They really need to charge many times over what they do to be profitable. But now they can't because there's too many players. They've boxed themselves into a corner, and there's no way out. Those in the know warned the studios that this would happen, but the studio execs. never understood, or wanted to understand, the dynamics of the home entertainment market as it existed before streaming was embraced wholeheartedly.

I view Disney as a special case due to their unique ability to monetize nostalgia through merchandise and licensing. I'd personally put a Disney streaming service in a similar category to the Disney Channel where it wasn't really a cash cow on first order effects but drove travel (parks + cruise), acted as an IP pipeline for parks and events (like Hannah Montana, Phineas and Ferb, Kim Possible), and drove merch demand while also acting as subsidized advertising for their feature films and other properties.

Other studios are definitely 6' under on their services mainly due to hyperfragmentation of the market. Netflix and Hulu were the only two with net profitability at the end of 2022.

 

[Mad Dog]

What do you define as "reasonable profit"? Netflix has posted a yearly net income greater than 1B since 2018 and north of 4B for the last two years (source). Tech certainly has a lot of losers that will sell $1 for 90c and say that they'll make it up in volume but Netflix doesn't seem to be one of them. You might say that that's only been going on for 5 years and that won't hold. Maybe so, but I'm a little more bullish given that I expect more and more players in streaming to realize that it's hard and that it's easier to make money licensing your stuff to others instead of running your own. Now granted, I do agree that NFLX is being treated like a tech growth stock with a PE of 50+ vs an average S&P P/E of ~30 but I think the unit economics of NFLX are solid.

You answered your question when you mentioned it's a growth tech stock, with a PE of 50+. That's the special treatment that has permitted them to survive, and continually refinance, using inflated stock. But I agree with you that, as streamers goes, they're the healthiest of a mostly sick bunch, and they have an uncanny knack to readapt and survive. Hopefully they've learned their lesson and will quit overproducing product. It's self defeating. And sooner or later those growth special treatments will end. See Krispy Cream and Blockbuster Video.