Mr. Iger said in a press release on Sunday night that he was “extremely optimistic for the longer term of this great company and thrilled to be asked by the board to return as CEO.”
What we consider before using anonymous sources. Do the sources know the knowledge? What’s their motivation for telling us? Have they proved reliable up to now? Can we corroborate the knowledge? Even with these questions satisfied, The Times uses anonymous sources as a final resort. The reporter and at the least one editor know the identity of the source.
Mr. Chapek didn’t reply to requests for comment.
The surprise reinstatement of Mr. Iger and ouster of Mr. Chapek is available in the wake of a disastrous earnings announcement on Nov. 8. Disney blindsided Wall Street by reporting $1.5 billion in losses at its fledgling streaming division, up from $630 million a yr earlier. Mr. Chapek said that higher Disney+ production, marketing and technology costs had contributed to the “peak” losses.
In total, Disney generated $20.15 billion in revenue in three months that ended on Oct. 1, a 9 percent increase from a yr earlier. But analysts had expected $21.3 billion. Profit totaled $162 million, or 9 cents a share, roughly flat from a yr earlier. Excluding items affecting comparisons, per-share profit for essentially the most recent quarter was 30 cents, much lower than analysts had expected.
It is nearly unheard-of for Disney to miss expectations on each revenue and earnings per share.
Disney shares dropped 12 percent the following morning, partly because investors — and plenty of people inside Disney — were shocked by the happy-go-lucky tone that Mr. Chapek struck while discussing the earnings report on a conference call with analysts. Mr. Chapek’s demeanor struck many as tone deaf, particularly when he began to implausibly speak about how great the response had been to Mickey’s Not So Scary Halloween Party, a comparatively inconsequential event at Disneyland. At the least one adviser had warned Mr. Chapek ahead of time that his prepared remarks were inappropriately sunny.
Immediately, the CNBC host Jim Cramer began to call for Mr. Chapek’s firing during comments on his show. On Friday, Mr. Cramer said that Mr. Chapek was “incapable of running a improbable company” and “we’d like someone latest at Disney.”
Mr. Cramer added, “That balance sheet is the balance sheet from hell.”
The comments by Mr. Cramer ricocheted amongst senior executives at Disney, who became increasingly irate, with just a few telling one another that that they had lost confidence in Mr. Chapek’s ability to steer Disney out of its slump. Disney shares have fallen 41 percent since January, to about $98, and far of the compensation of senior creative leaders at Disney is available in stock options.
Mr. Chapek was named C.E.O. in February 2020, taking up from Mr. Iger. The handoff didn’t go easily. The coronavirus pandemic forced Mr. Chapek to shut many of the company. This yr, Mr. Chapek contended with one crisis after one other, a few of his own making.