Disney extends CEO Bob Iger’s contract

walt disney company Will extend CEO Bob Iger’s contract by two years, extending his tenure until 2026.

Shares in the company were effectively flat following the news.

Iger told CNBC in February that he had no intention of staying in the role for more than two years, which would have lasted until 2024. Iger returned to Disney in November, taking over the role from Bob Chapek, who was named CEO in early 2020. Iger plans to prepare his next successor during his new term as CEO.

The succession process remains a key issue for Iger, who noted in a statement Wednesday that the company’s board will continue to evaluate candidates for the position. “I want to make sure that Disney is in a good position when my successor is at the helm,” Iger said of the contract extension. “The importance of the succession process cannot be overemphasized.”

However, Iger has also delayed succession decisions before. On four separate occasions between 2013 and 2017, he said he planned to retire and extend his tenure as chief executive.

Iger’s second tenure at Disney coincides with an upheaval in the traditional media landscape. Big companies like Disney are having to grapple with a rapidly changing landscape as ad revenue dries up and consumers increasingly cut cable subscriptions to stream.

However, the streaming space has been tricky to navigate in recent quarters as fees have escalated and consumers have grown more conscious about their media spending. Slowing streaming subscriber growth cut the valuations of Netflix, Disney, Warner Bros. Discovery and Paramount Universal by about half in 2022, before several stocks rebounded with the broader market in the first half of the year.

After returning home, Iger undertook an extensive restructuring of the company, which included layoffs of 7,000 people.

“I am proud of what we have accomplished together as we made important and sometimes difficult decisions to address some existing structural and efficiency issues,” Iger wrote in a memo to employees obtained by CNBC on Wednesday. .” “But there is more work to be done before this transformative work is done, and I am committed to getting it all done.”

disney already pull programming Save money from its streaming service.The company is also trying to get its animation business off the ground, with its latest Pixar film Elements documenting Lowest opening weekend The studio has been working on it since the original Toy Story premiered in 1995.

Disney also recently completed Lay off 7,000 employees And witnessed the departure of veteran CFO Christina McCarthy.

“Bob has once again put Disney on the right strategic path for continued value creation, and the board believes it is in the best position to ensure the success of this transition while also allowing ample time for the appointment of a new CEO for long-term success Disney Chairman Mark Parker said: “In the interest of shareholders, to extend his tenure, he has agreed to our request to remain CEO through the end of 2026. “

CNBC’s David Faber will interview Iger on CNBC’s “Squawk Box” Thursday at 8:00 AM ET.

Read Iger’s full memo to Disney employees:

Dear staff:

I want to thank you for your tremendous dedication, patience, and optimism as we take important steps to reposition the company for lasting creative and financial success. Since returning to Disney seven months ago, I’ve examined nearly every aspect of our business to fully understand the enormous opportunity in front of us, as well as the challenges we face on many fronts.

We made important and sometimes difficult decisions to address some existing structural and efficiency issues, and I’m proud of what we were able to achieve together. But there is more work to be done before this transformative work is done, and I am committed to getting it done.

To this end, I am writing to indicate that I have agreed to the request of the Disney Board of Directors to continue as CEO for two years, through the end of 2026.

Since we began this important transformation of the company, as I have said many times, our progress will not be linear as we continue to navigate a difficult economic environment and the structural shifts taking place in our industry. At this moment, we need to remain firm, strategic, and aware of the path ahead.

Equally important to me is that Disney will be in a strong position when my successor is at the helm. I remain highly focused on a successful CEO transition as the Board continues to evaluate high-quality internal and external candidates.

Through it all, I am unwaveringly optimistic about Disney’s future. I trust this company. I trust the leadership team around me. I believe in you – our amazing staff and cast. It has been an honor to work with you as we chart the path forward for Disney, and I look forward to what we will continue to achieve in the years to come.

Thank you for what you do,
Bob

— CNBC’s Alex Sherman, Kerry Caufield and David Faber contributed to this report