HomeDisney ParksChapek Out. Iger In. The Full Story.

Chapek Out. Iger In. The Full Story.

Developing story as of Friday, November 18th, 2022. Updates and edits will be made as needed.

Chapek is out. Iger is in. Again.

In a shocking twist that could not have been predicted, Disney’s CEO Bob Chapek is out, and former CEO Bob Iger is back, effective immediately.

What brought about this drastic change?

Let’s take a look at how we got here, what it could mean (and won’t mean) for Disney’s theme parks. 

Bob Iger Returns to Disney

On a very late Sunday night the news reports started coming out. Bob Iger was returning to Disney as CEO. I honestly thought it was some sort of joke when I first saw the headlines. (It is legit- here’s the official press release from Disney.) 

I generally stay away from discussing Chapek and all the controversy and negativity that surrounds him within the Disney community.  If you’re familiar with it, you likely have other sources for those updates. I believe much of it is speculation anyway.

But with this huge upheaval and change, I think it’s worth taking a closer look. Let’s break down all of the events that led to this point. 

The Legacy of Bob Iger

Bob Iger spent 15 years as CEO of Disney, from 2005 to 2020. He was instrumental in acquiring major brands like Pixar, Marvel, and Lucasfilm. It’s almost hard to imagine a Disney without those brands, but at the time, acquiring them was highly controversial. In the final years of his tenure, he closed a $71 billion deal to buy most of 21st Century Fox and launched Disney’s first streaming service, Disney+. 

Chapek

Not only was he loved and respected both in and outside of the company, but he was a brilliant businessman. When Iger first took over as CEO in 2005, the Disney market cap was roughly $55 billion and by the time he parted ways with the company, it was $260 billion. His track record speaks for itself. 

Just before the world-changing events of 2020, Iger officially retired and Disney announced Chapek as the new CEO. When I say just before, I mean that literally. In February 2020, Chapek took over. Just weeks later, the world came crashing down from Covid. This resulted in an unprecedented closure of all Disney theme parks worldwide.

Can you imagine being given the reigns to Hollywood’s biggest company weeks before everything fell apart? The entire entertainment industry comes to a standstill, and all your profit sources dry up in a matter of weeks. Sometimes you gotta wonder at the immaculate timing of Iger. 

Chapek Takes Over As CEO

Chapek

Bob Chapek had a rough start, and honestly, you couldn’t really blame him. However, things never seemed to get a whole lot better.

Disney did an incredible job navigating the huge minefields and the no-win struggles that year, from the controversy on the reopening of Disney World, to mask mandates, social distancing, and vaccination requirements…

I mean you guys know. We all lived through it.

It was a hard time, and being a multi-billion dollar corporation just meant the stakes were higher. They poured their resources into the Disney+ platform, still in its infancy stages, but one of the few revenue streams that hadn’t come to a screeching halt. 

And for the most part, they weathered the uncertainty of that year with, in my opinion, a lot of class. They made changes like park reservations for crowd control and sales of annual passes were frozen to keep crowds low.  And like every other company during this time, they laid off a lot of people. 

Chapek’s Challenges Continue

But Chapek’s difficulties didn’t stop with the Covid-related struggles. The rest of his tenure has also been rocky, marked by controversies and distractions. From the aggressive campaign against Marvel star Scarlett Johansson to the criticism of Disney’s response to Florida’s controversial “Don’t Say Gay” bill, Chapek has had to deal with a wide array of public misfires during his relatively brief tenure at Disney.

And that doesn’t even touch on his reputation with Disney fans. 

Disney has come under heavy criticism during Chapek’s reign, most of it related to the changes with the domestic parks. Both Disney World and Disneyland have seen many changes, including price increases and the rollout of Disney Genie and Lightning Lanes replacing the free Fastpass system. 

That along with staffing and entertainment cuts, as well as requiring park reservations, and disappearing perks for resort guests all contributed to much resentment among Disney park guests. And since all of these changes happened when Chapek came on board, he definitely became the villain for many fans. His public appearances started getting cut, as the negativity from the fans increased. 

A Turning Point

As time went on, it was clear that within the company things were taking a strong turn from the way Iger had run things, and insider sources were saying that not only was Iger not happy with how things were going, but the two had a falling out and were not speaking by this point. Iger reportedly said naming Chapek was one of his worst business decisions. Chapek led Disney to move forward with a new organizational structure that removed many of the old Iger loyalists and replaced them with new people chosen by Chapek as they focused resources on the Disney+ streaming service. 

Many wondered if the board (who ultimately decides who stays and who goes) would keep Chapek amid so much negativity. His contract was up for renewal in June 2022 and fans waited to see what would happen. But to people’s surprise, they renewed Chapek’s contract for three more years and expressed their confidence in his leadership. Chapek’s new contract began in July and was set to run until 2025.

And from a profit standpoint, it was going pretty well. Disney’s parks and consumer products businesses remained strong and the summer earnings reports showed the parks business was having its best year ever. Though those profits were driven by price increases and upsells like Genie+, resulting in alienating many fans. Experts expressed concern that the company could be making its parks less accessible to middle-class families, which would hurt the company down the line.

And by the Fall of this year, it did seem that Chapek may have finally found his footing. Maybe the vote of confidence from the board helped. He started a new PR approach to “rebrand” his image. (Sources: here, and free one here.) At the D23 Expo in September 2022, he gave more interviews than he had before, and even met with news and fan sites in a small group to have more personal, off-the-record conversations. All of these were small things, but many felt things were moving in a better direction. 

What Led Up to Firing Chapek

That is why this sudden change in leadership was so shocking. And to have it all announced late on a Sunday night just before Thanksgiving, with changes taking place immediately made it even more unusual.

After extending his contract everyone assumed the board was all in with Chapek. But, more details have come to light indicating that Disney execs and board members were not as confident with Chapek as they once professed. Either Disney’s board wasn’t truthful in its confidence in June, or something so drastic has happened between now and then to change their mind.

What We Know

We know the latest earnings report held earlier this month didn’t seem to go well. Perhaps this was the catalyst or the straw that broke the camel’s back. Parks have been having record profits due to the increases in pricing along with all the paid upgrades they’ve added. But we have to wonder if Disney World and Disneyland pricing is being hiked up to cover the losses in other areas. 

Their streaming service in particular reported record losses in their reports earlier this month. Net operating losses in Disney’s streaming division ballooned to $1.47 billion in the quarter. 

Not only were the numbers not favorable, but the way Chapek handled the report was an issue. His performance on the most recent earnings call earlier this month, according to this account, was the deciding factor.

In fact, it was so bad that Mad Money star Jim Cramer immediately demanded Chapek be fired. “There is just no doubt that he has to go,” Cramer said. “The way he handled it, he made it sound like it was a four-star quarter. Delusional.” This sparked conversation in both the financial and entertainment worlds, making Chapek and the Disney company look pretty bad. 

This caused a 13% drop in Disney shares in the stock market – the lowest since March 2020. 

Chapek alluded to cost-savings during the call, but it wasn’t until later that week that he outlined his dramatic plans. In an email to all employees on November 11 (his last), he outlined the creation of a “cost structure task force” that would re-evaluate the organization and priorities. He was confident the results of this task force would lead to layoffs and a hiring freeze. Company morale hit an all-time low. 

The Final Straw

Sources have stated that the Fall quarterly earnings report was in fact the final straw in putting everything in motion. New York Times did a great piece on this with tons of insider sources. (It may be behind a paywall, but here’s the link and I’ll paraphrase what they found.)

Senior leaders within the organization began expressing a lack of confidence in Chapek and speaking openly about his resignation. A NY Times source claims the Disney Board of Directors had been divided over keeping Chapek in place for the past several months. Because of the current situation, they made a final decision and pressed the panic button. 

They needed a leadership change and they needed it fast. And there was no time to train someone new. They had to have someone who already knew the job. Susan Arnold, the board chair, called Mr. Iger at 3 p.m. on Friday November 18 and asked him to return. The deal was reached quickly and announced two days later, surprising many within the company, including Chapek himself. Insiders say few even at the highest levels knew the announcement was coming.

When the end came for Chapek, even a Disney-connected source who is not a Chapek fan expressed shock at the way it went down. “He didn’t get to say goodbye or say, ‘I’ve decided to step down,’” this person says. They called [Chapek] and said, ‘You’re out. Our lawyers will call your lawyers.’ No statement from him, no comment from him, no grace.”

So now here we are, with new leadership in place. Iger is already making changes to undo the systems and people Chapek had put in place. Disney’s stock immediately jumped up 10% just with the announcement of the change. Disney’s market cap which was $260 billion when Iger left has fallen to $167 billion as of Friday, November 18. So he’s got some work to do to get the overall numbers back up to where they were.

And he is not a long-term solution. Iger agreed to the CEO position for two years in order to prepare a successor to take the role permanently. The question remains who will that be? Without any real prospects (that we know of), the future still feels uncertain.

So, what does it mean (and not mean) for us as fans and guests of the parks?

Chapek

What This Means for Disney World

We all love a villain- someone to blame for frustrations and changes we don’t like. Bob Chapek was the villain. He was blamed for anything that went wrong, from rising costs to popcorn bucket sell outs. But the reality of things is quite different. 

In a corporation like Disney, the CEO certainly has influence over culture and tone, but he’s not the all-powerful Oz. There are many decisions that involve a lot of people, and some the CEO has nothing to do with. 

Was Chapek really a bad fit for the Disney company or was he a corporate scapegoat for a difficult time?

The fact is, we may never know the real truth. Or the truth may depend on who you ask. But ultimately,  it doesn’t really matter.

If he was that hated, he could not stay as the face of the company.

Keeping him would only do further harm to the brand. 

Here’s the real truth, most of these were set into motion during Iger’s reign. They were then implemented when Chapek was at the helm. That means the Genie system and all the paid upgrades was actually an Iger idea. In fact, that system had been in the pipeline for years before it was launched. And would have happened no matter what. 

If Iger hadn’t left, we still would have had layoffs, live entertainment reductions, budget cuts, and overcrowding in the parks. All of those are products of everything that’s happened in the world and in business over the last two years. 

Would they have been handled better? Could communication have better explained things? Would the timing of price increases have been announced at better times? Perhaps.

I’d like the think that the PR side of things would have been better. And so maybe our perception of these changes could have been overall more positive. But the actual results may be the same. 

So that means you should not expect Disney to announce the end of Disney Genie and Lightning Lanes. The problems they try to solve are still there. The demand is far higher than the supply right now at Disney World. And crowds and wait times are complicated issues that aren’t simple to fix. 

Serena’s Final Thoughts

I will say this.

The heart of the Disney company has been missing for a while. The communication style and priorities seem to have shifted away from the culture that the Disney company is all about. This is most evident in the way Cast Members operate . They are clearly not as happy in their roles as they once were.

Unhappy workers produce a trickle-down effect that we see in everything. When it comes to Disney’s parks, we all know the CMs are what make the magic. They are the difference between going to Disney and any other theme park. And that magic is what keeps us all coming back, year after year. 

If this change helps them and makes them feel more hopeful, if working conditions improve, and if they feel seen and heard by their leaders, isn’t that a win for all of us? 

So now we wait and see. Changes take time. Iger has his work cut out for him. The Disney company is made up of far more than just the parks. With multiple priorities, I personally think that the parks issues is not at the top of the priority list right now. 

But leadership affects morale a lot, and when people feel positive and hopeful they work better. So it may not take too long to see improvements from a park experience perspective. We all have reason to feel excited for the future of Disney as a company and as a theme park. 

I for one was thrilled to hear about the change. With so much fan frustration and anger with Walt Disney World, this is a welcome change from my vantage point. I look forward to seeing where things go from here. I’m ultimately a Disney fan first, and as a fan, I just want to see the company thrive, do well and keep the magic alive that we all love. 

I’d love to know your thoughts. Leave a comment below and let me know how you feel about the recent changes.

Marnie Raimondo
Hi there! I'm Marnie, Disney blogger and writer. My passion is helping people plan magical Walt Disney World vacations. I love sharing Disney tips and advice based on my personal experiences from many, many magical trips over the years. I hope through my writing I can help you navigate your way through Disney news, the parks, dining, resorts and so much more! Happy planning!

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Hi there, I'm Serena and I created Living by Disney when I moved next door to Disney World in Orlando Florida. I don't work for Disney and don't represent the company, but after moving here I made it my job to share unbiased tips and strategies to help you get the most out of your Walt Disney World vacation!

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