While the Walt Disney Company has seen much reorganization in its present era under Iger’s leadership, Wells Fargo predicts even more changes in the coming year.
The Mouse House has had a very interesting and eventful end to its year. The Walt Disney Company has seen a “clean up” of sorts, with Bob Chapek being ousted from his position as chief executive officer of the Walt Disney Company. The firing of the former Disney CEO was followed by Disney also letting go of his top allies and even his speechwriter.
By all reports, former Disney CEO Bob Chapek left the company’s CEO Bob Iger a huge mess to clean up. In the last few days of Mr. Chapek’s leadership, CNBC analysts even went so far as to call the former Disney CEO delusional for the decisions he’d made thus far.
As reported by Fox Business, one of Mr. Iger’s first steps will be to change the priorities of the entertainment giant. Per the article, Wells Fargo predicts that Walt Disney’s Bob Iger will shift the mass media and entertainment company’s focus to content and cost rationalization while spinning off the broadcast network ABC and the cable sports channel ESPN (a route through which Chapek once hinted Disney might even open the channels of online gambling with).
The bank analysts predict this will happen in late 2023, leaving the Walt Disney Company as a pure play intellectual property company. As reported by Fox Business,
While ESPN has been the cash cow of the pair, linear and sports trends are diverging from the core IP. In addition, the sports network is not owned IP or global like Disney, so “we think severing the company is increasingly logical,” the analysts stated. ESPN is owned 80% by Disney and 20% by Hearst Corporation.
Earlier this year in September, activist investor Dan Loeb called for a spinoff of ESPN but later backed off after understanding the network’s ability to generate ad and subscriber revenues.
Disney has used these channels during Chapek’s tenure to highlight some of the positive changes that were happening in the world of Disney (especially while dissatisfaction with the Theme Parks was on the rise). In the past few weeks, Disney stock has seen a rise (during Iger’s return announcement) but also a drastic fall recently, with the release of Avatar 2 not living up to expectations.
We at Disney Fanatic will continue to report on all Disney news as it comes to light.