News The Walt Disney Company Board of Directors Extends Robert A. Iger’s Contract as CEO Through 2026

[Sirwalterraleigh]

I’ll reiterate my ‘personal’ stance that negative sentiment often significantly lags recovery. Market sentiment is far more forward looking. Generally the best time to invest is as a recession is being declared.

Course correction started in early 2023. Sentiment has bottomed possibly with Wish. Markets started to recognize the recovery in Fall of 2023.

So no, I don’t personally support that Disney is on the wrong trajectory. They are actually heading the right direction and people aren’t recognizing it yet. Everyone who is complaining Disney is in a creative/investment/financial/leadership recession are missing that the recession has in fact ended several quarters ago.

But no - that does not mean management has had a change of heart and we’re in for originality all the time either. That ship sailed decades ago.

I’m still trying to figure out how their “trajectory” had changed much at all?

Still milking the same tired cows harder

 

[Sirwalterraleigh]

In theory the market is efficient and already knows the outcome because it determines the outcome.

They’re gamblers with supercomputers…in practice

Read Flash Boys…it’s excellent

 

[Casper Gutman]

I love this financial logic:

The MCU, largely under the leadership of Kevin Feige, has been the most successful film franchise in history by some margin. After a nearly unbroken string of 30 hits, 2023 saw the release of one bomb, one underperformer, and one hit, all in a deeply inhospitable box office environment. The only conclusion is that superhero movies are dead, Disney must abandon perhaps its most lucrative IP, and Feige should be fired.

Responsible!

Or:

After many years of universally predicted losses, Disney+ is about to become profitable right when Disney always said it would. However, Wall Street no longer thinks streaming is cool, so Disney+ should be abandoned, replaced by… I don’t know… AI? AI is hot.

Logical!

 

[TalkingHead]

In theory the market is efficient and already knows the outcome because it determines the outcome.

Very efficient, they’ve already factored in the eventual collapse of the company, the economy, and the universe.

 

[WoundedDreamer]

I’m still trying to figure out how their “trajectory” had changed much at all?

Still milking the same tired cows harder

I actually really agree with this. What we have so far are promises...
1) A promise that the sport-streaming service will launch effectively and become profitable
2) A promise that by focusing exclusively on sequels and reducing the amount of content moving forward, the movie studio will recover
3) A promise that the linear channels will not implode more rapidly than they already are
4) A promise that DPEP will remain stable and continue to earn at this rate
5) A promise that Disney can spend less adding content to Disney+, while still driving engagement with their platforms and increasing prices.

All those things are actually still distant. The reality is that we don't know how well this strategy is going to perform until the rubber meets the road. While Iger wants to say that the recovery is well underway, we've yet to see tangible signs of that recovery.

There's reason for optimism. Inside Out 2, the ape film, Deadpool 3, and Moana all are potentially successful films. But I would have said the same thing about Indiana Jones 5. I think there's reason for a healthy dose of skepticism to go along with the exuberance.

 

[TalkingHead]

I’ll reiterate my ‘personal’ stance that negative sentiment often significantly lags recovery. Market sentiment is far more forward looking. Generally the best time to invest is as a recession is being declared.

Course correction started in early 2023. Sentiment has bottomed possibly with Wish. Markets started to recognize the recovery in Fall of 2023.

So no, I don’t personally support that Disney is on the wrong trajectory. They are actually heading the right direction and people aren’t recognizing it yet. Everyone who is complaining Disney is in a creative/investment/financial/leadership recession are missing that the recession has in fact ended several quarters ago.

But no - that does not mean management has had a change of heart and we’re in for originality all the time either. That ship sailed decades ago.

So much of their future portfolio is riding on streaming, and I have to wonder how much of a disadvantage Disney is at being seen by most general consumers as an alternative choice to Netflix. How much are people willing to pay for a D+/Hulu package per month? How little new content can they offer before people say this is a ripoff? How poorly (read: cheaply) produced can that content be?

All questions the next CEO will get to handle, I guess. Suspect theme parks will be at the bottom of their list.

 

[Casper Gutman]

So much of their future portfolio is riding on streaming, and I have to wonder how much of a disadvantage Disney is at being seen by most general consumers as an alternative choice to Netflix. How much are people willing to pay for a D+/Hulu package per month? How little new content can they offer before people say this is a ripoff? How poorly (read: cheaply) produced can that content be?

All questions the next CEO will get to handle, I guess. Suspect theme parks will be at the bottom of their list.

Netflix’s entire model is a flood of poorly produced content. They’re shifting strategies now, but that’s been their conscious approach.

 

[Sir_Cliff]

I actually really agree with this. What we have so far are promises...
1) A promise that the sport-streaming service will launch effectively and become profitable
2) A promise that by focusing exclusively on sequels and reducing the amount of content moving forward, the movie studio will recover
3) A promise that the linear channels will not implode more rapidly than they already are
4) A promise that DPEP will remain stable and continue to earn at this rate
5) A promise that Disney can spend less adding content to Disney+, while still driving engagement with their platforms and increasing prices.

All those things are actually still distant. The reality is that we don't know how well this strategy is going to perform until the rubber meets the road. While Iger wants to say that the recovery is well underway, we've yet to see tangible signs of that recovery.

Isn't that just the nature of developing and executing plans, though?

He can't just snap his fingers and make it all happen straight away, so you do really have to look at the plans that have been outlined and decide whether you find them credible.

I feel a bit the same way about all the annoyance Disney didn't just suddenly announce tens of billions of dollars worth of new attractions as soon as those investment plans were outlined by Iger. These are big, complicated projects that don't just spring into existence as easily as dreaming up cool new rides on Internet forums.

 

[WoundedDreamer]

Isn't that just the nature of developing and executing plans, though?

He can't just snap his fingers and make it all happen straight away, so you do really have to look at the plans that have been outlined and decide whether you find them credible.

I feel a bit the same way about all the annoyance Disney didn't just suddenly announce tens of billions of dollars worth of new attractions as soon as those investment plans were outlined by Iger. These are big, complicated projects that don't just spring into existence as easily as dreaming up cool new rides on Internet forums.

You're exactly right, but that's why I don't feel the exuberance around the "recovery" is warranted. The jury is still out on this case, and we don't know if Iger actually is cementing The Walt Disney Company's future success. We're still in the midst of a crisis that could either result in Disney's successful turnaround, or see it continue to struggle and even worsen. We don't have the data yet.

Iger might be saving Disney, or he could actually be making blunders. We don't have the concrete data to support either view yet.

 

[BrianLo]

Very efficient, they’ve already factored in the eventual collapse of the company, the economy, and the universe.

Har har.

Roughly extrinsic factors are accounted for. It cannot see the future indefinitely, but if it’s something the royal we are worried about the market has already priced it in. It’s not a “perfect market theory” or an “infallible market”, but efficient. The odds of the heat death of the universe occurring in the moderate term are indeed accounted for, they are incredibly low.

Now this vote is very intrinsic, it’s the market voting. Which doesn’t mean the players involved can’t be suddenly irrational. Iger or Peltz could both publicly murder someone tomorrow. It also doesn’t mean the market can’t predict some irrational large shareholders, but as I’ve said Blackrock, Vanguard and State Street are pretty much determining things.

I personally think a victory would lead to a stock drop because I personally think the closeness of the vote is being oversold. It’s not close. Something irrational would have to occur for the major stable funds to pick the chaos option in a currently very stable board with very positive benchmarks and a very well regarded leader (by the broader market).

 

[BrianLo]

All those things are actually still distant. The reality is that we don't know how well this strategy is going to perform until the rubber meets the road. While Iger wants to say that the recovery is well underway, we've yet to see tangible signs of that recovery.

We have, it’s just hard to argue against the court of opinion rather than cold financial logic. The quarterlies are dramatically improved and the forward guidance is dramatically improved. Money is the determinate of recovery - both fortunately and unfortunately. And short-medium term money at that. Which is why you need leadership who are surrounded by yes man, because there is no other way to really gain confidence of investors in the Parks domains, which are otherwise very much ‘long-term’ investments.

The market believes it (that the company is recovering). Whether it is foolish to do so is opinion. Which I’m actually not opposed to, I’ve personally both thought the company was wildly over valued and under valued in the last 4 years.

 

[TalkingHead]

Har har.

Roughly extrinsic factors are accounted for. It cannot see the future indefinitely, but if it’s something the royal we are worried about the market has already priced it in. It’s not a “perfect market theory” or an “infallible market”, but efficient. The odds of the heat death of the universe occurring in the moderate term are indeed accounted for, they are incredibly low.

Now this vote is very intrinsic, it’s the market voting. Which doesn’t mean the players involved can’t be suddenly irrational. Iger or Peltz could both publicly murder someone tomorrow. It also doesn’t mean the market can’t predict some irrational large shareholders, but as I’ve said Blackrock, Vanguard and State Street are pretty much determining things.

I personally think a victory would lead to a stock drop because I personally think the closeness of the vote is being oversold. It’s not close. Something irrational would have to occur for the major stable funds to pick the chaos option in a currently very stable board with very positive benchmarks and a very well regarded leader (by the broader market).

Because the only metric the market is interested in is when will streaming be profitable. And the promises that it will be right around the corner are too good for the market to resist. But that could prove a snafu if it’s not taking into consideration how that profitability is achieved, what it says about the focus of the rest of the company, etc.

This is still a media/entertainment company at its core, and they haven't been throwing fastballs in a while. At some point investors (and consumers) are going to look up and say when did creative get so stale here?

 

[BrianLo]

So much of their future portfolio is riding on streaming, and I have to wonder how much of a disadvantage Disney is at being seen by most general consumers as an alternative choice to Netflix. How much are people willing to pay for a D+/Hulu package per month? How little new content can they offer before people say this is a ripoff? How poorly (read: cheaply) produced can that content be?

All questions the next CEO will get to handle, I guess. Suspect theme parks will be at the bottom of their list.

Because the only metric the market is interested in is when will streaming be profitable. And the promises that it will be right around the corner are too good for the market to resist. But that could prove a snafu if it’s not taking into consideration how that profitability is achieved, what it says about the focus of the rest of the company, etc.

This is still a media/entertainment company at its core, and they haven't been throwing fastballs in a while. At some point investors (and consumers) are going to look up and say when did creative get so stale here?

Sorry I was just working forward on the posts. Yes I agree, streaming is way too heavily impacting Disney’s valuation. Which I think is very much shared opinion!

I don’t think it’s as dire as being projected. Netflix is determining the top end and seemingly hasn’t reached the ceiling. The panic in Jan 2022 was they had.

ARPU on Netflix is 16.63 in the US. How much consumers are willing to pay for D+/Hulu is somewhat unknown, but the answer for now is technically more than they currently are.

Eventually the train will reach the end of the track and the rapid streaming will no longer be a source of fast growth. I’m just not sure where that end is.

I also personally like Bob’s studio strategy better than Netflix. Moderate amounts of high quality product. Rather than flooding to see what sticks. It does mean things are more high profile when they miss. I also don’t think it is terribly wise of them to constrain content too much, it will shoot them in the foot later. But it’s worth noting content spend is not actually constrained yet. The strikes slowdown won’t be realized in cost savings until later this year running through 2026.

 

[Slpy3270]

If Vanguard and State Street side with Disney then that might do it.

 

[BrianLo]

If Vanguard and State Street side with Disney then that might do it.

Ya, it’s over. Good riddance!

 

[Slpy3270]

Ya, it’s over. Good riddance!

Iger can't be cocky because his potential victory could quickly become a pyrrhic one if he's complacent, as DuPont found out when they held off Peltz.

 

[Sirwalterraleigh]

I love this financial logic:

The MCU, largely under the leadership of Kevin Feige, has been the most successful film franchise in history by some margin. After a nearly unbroken string of 30 hits, 2023 saw the release of one bomb, one underperformer, and one hit, all in a deeply inhospitable box office environment. The only conclusion is that superhero movies are dead, Disney must abandon perhaps its most lucrative IP, and Feige should be fired.

Responsible!

Or:

After many years of universally predicted losses, Disney+ is about to become profitable right when Disney always said it would. However, Wall Street no longer thinks streaming is cool, so Disney+ should be abandoned, replaced by… I don’t know… AI? AI is hot.

Logical!

Nobody is debating the financial success of MCU

The problem is endgame opened 4 years, 340 days ago…

And how has that trajectory gone since?

A negative slope for you trig fans…

Gotta stop lauding 2015…it was great. But it’s not being replicated.

 

[Sirwalterraleigh]

Ya, it’s over. Good riddance!

Not really surprising at all…

And is this an “official leak”…or an “unofficial leak”

My head spins deciding on the “validity scale”


Wait a minute “pulled ahead”? So like with 3/4 of a billion votes they were behind?

It was NEVER supposed to be that close The goalposts are on wheels here

 

[Sirwalterraleigh]

Isn't that just the nature of developing and executing plans, though?

He can't just snap his fingers and make it all happen straight away, so you do really have to look at the plans that have been outlined and decide whether you find them credible.

I feel a bit the same way about all the annoyance Disney didn't just suddenly announce tens of billions of dollars worth of new attractions as soon as those investment plans were outlined by Iger. These are big, complicated projects that don't just spring into existence as easily as dreaming up cool new rides on Internet forums.

You forgot the yutz said he’s leaving

Something doesn’t compute then

 

[Slpy3270]

Not really surprising at all…

And is this an “official leak”…or an “unofficial leak”

My head spins deciding on the “validity scale”

TBF I found it very hard to believe BlackRock would side with Peltz given they dealt with his crap during the DuPont proxy fight. Plus Fink and Peltz have very different politics despite both otherwise being cringey.