What. A. Week.
It has been the news that has sent shockwaves around the entertainment industry. Bob Chapek has been fired as CEO of The Walt Disney Company, and his predocessor, Bob Iger, has been called to step in for two years.
And according to sources, it was also a shock for Chapek himself.
With his abrupt ousting as Disney CEO, Mr Chapek is now at the forefront of online satire, Cast Member celebrations, and huge industry shock. But what was the behind-the-scenes timeline of his exit?
Credit: DisneyWith a petition going viral last year aiming to persuade the Walt Disney Company to fire Chapek, the Disney head has become quite a continued topic of discussion among Disney Guests. Chapek did, however, have to follow in Iger’s shadow. Bob Iger was a well-loved Disney CEO, steering Disney through acquisitions of Lucasfilm, Pixar, Marvel Studios, and 21st Century Fox to become the giant entertainment company it is today.
Bob Chapek’s time as CEO of The Walt Disney Company divided Disney fans, so let’s look at the highs and lows of Chapek’s journey from new Disney CEO to former Disney CEO.
Back in February 2020, Bob Chapek was named chief executive officer of the Walt Disney Company, replacing Bob Iger, who would remain as executive chairman until the end of 2021. This choice was considered a surprise to many Disney employees, who had seen Tom Staggs as the successor to Disney CEO Iger. Bob Chapek’s role as Disney CEO followed a 15-year tenure from Bob Iger.
Chapek did not have it easy to begin with as CEO, starting just before the COVID-19 pandemic ahead of closures of the Walt Disney World Resort, Disneyland Resort, Disney Cruise Line, and Disney Parks across the globe, as well as a high-profile lawsuit with Scarlett Johansson.
In April that year, Chapek was elected to the Walt Disney Company’s board of directors. It was later revealed, the same month, that while Chapek remained CEO, Iger had resumed control of the company’s operational duties for the time being, due to the unprecedented COVID-19 pandemic.
From plexiglass separators to social distancing markers, Guest experiences at Walt Disney World were altered for the health and safety of Guests and Cast Members on its phased reopening in July 2020.
Throughout the pandemic, Disneyland, Disney’s California Adventure, Magic Kingdom, EPCOT, Disney’s Hollywood Studios, and Disney’s Animal Kingdom all abided by federal mask requirements and the Centers for Disease Control and Prevention (CDC) face mask guidelines.
Chapek stated that upon the reopening of the Walt Disney World Resort in July, both Cast Members and Guests would be required to take temperature checks, wear face masks, and observe social distancing guidelines. He also explained that Disney Parks would continue to work with local government and healthcare professionals to open the theme parks responsibly. When the Parks reopened, the first attraction he said he would ride was Pirates of the Caribbean at Magic Kingdom.
Due to the pandemic, Chapek spoke about the company’s decision to focus on streaming media, including Disney+, and direct-to-consumer advertising. Premier Access on Disney+ was revealed, with multiple films that were originally slated for theatrical releases, including Mulan (2020) and Pixar’s Soul (2020), not receiving theatrical releases. Mulan was offered on Disney+ for a premium fee of $30, while Soul was offered for no additional cost.
Later that year, with Parks still relatively empty and following safety protocols, Chapek agreed to keep Walt Disney World at only 25% capacity until the CDC issued new guidance.
Chapek also did some reorganization, introducing a new leadership structure. In one of his first big moves since taking over as chief executive, the Walt Disney Company announced a realignment of its business divisions that placed the focus on Disney+ and its other streaming services as the future of the company’s creative efforts.
In a new role created by Mr. Chapek, Kareem Daniel, a 14-year veteran of the company who most recently had run the company’s consumer products division, became the chairman of media and entertainment distribution.
In March, Chapek introduced the first price increase to Disney+. The monthly price was raised to $7.99 – or $79.99 annually.
Walt Disney World officially ended its mask mandate and temperature checks (except while on Disney transportation like the Monorail) while Magic Kingdom, EPCOT, Disney’s Hollywood Studios, and Disney’s Animal Kingdom were operating at higher capacity. That same month, fireworks spectaculars returned.
Disneyland Park and Disney California Adventure both reopened on April 30, 2021 after being closed for more than a year. The controversial Park Pass Reservation system was also introduced, something still used to this day.
Although Disneyland had reopened its doors, the Annual Pass service did not return and was instead replaced by the Magic Key Program. This new program came with tiers, each with different benefits depending on what Guests pay for their pass.
Walt Disney World also introduced an overhaul of their Annual Pass System, with new sales beginning in September 2021 of the Sorcerer Pass, Incredi-Pass, Pirate Pass, and Pixie Dust Pass.
Renewals have been open to Guests who already held Annual Passes, but Disney has continued its pause on sales of new APs, amid comments from Chapek referring to Passholders as an “unfavorable attendance mix.”
The Walt Disney World 50th Anniversary celebration kicked off on October 1, 2021 at the Central Florida Resort. Bob Chapek appeared at the Magic Kingdom theme park to commerorate the milestone.
On October 19, 2021, Disney Genie, Genie+, and Individual Lightning Lane launched in Walt Disney World, a replacement to the old, free FastPass system. Genie+ was originally priced at $15 per person per day, and since dynamic pricing was introduced, the cost of the service has continued to fluctuate based on the time of year and crowd levels in Disney Parks.
With Thanksgiving fast approaching at the Walt Disney World Resort, the Genie+ purchase price this week reached an all-time high of $29 per Guest.
Price increases continued to be top theme park news with Disneyland ticket and parking cost hikes, followed by restaurant cost increases in early 2022.
Chapek becomes embroiled in a battle with Florida Governor Ron DeSantis after Florida passed its Parental Rights in Education Act (known as the “Don’t Say Gay law”).
Reports rose that Disney funded the legislators who wrote and sponsored the bill, which conflicted with the company’s pro-LGBT+ image and Inclusion Key. In a company memo, Chapek refused to criticize the legislation and played down the company’s backing of anti-LGBT+ legislators, statements that were heavily criticized.
Chapek then reversed his stance, claiming that Disney was “opposed to the bill from the outset” and would be donating to several LGBT+ organizations.
The Florida House of Representatives passed a controversial bill that would dissolve Disney’s special treatment ruling in the state.
Amid a political boycott of The Walt Disney Company, Florida Governor Ron DeSantis’ plot against Disney was in full swing in attempts to dismantle Walt Disney World’s bubble, the Reedy Creek Improvement District.
For over 50 years, Walt Disney World has been able to reside in Florida unregulated, acting as its own “government” in a way. The 1967 act involved creating a special taxing district that acts with the same authority as a county government. Local taxpayers – residents of Orange County and Osceola County – do not have to pay for building or maintaining Disney’s essential services.
State Senate Minority Leader Gary Farmer warned that residents of Orange County and Osceola County may have to assume Disney’s liabilities of anywhere between $1 billion and $2 billion if the Reedy Creek Improvement District is dissolved.
Chapek signed a three-year contract extension with Disney.
In August, it was revealed that a new ad-supported tier would be coming to Disney+, and price increases would be coming along with it.
The new ad-free tier starts at $10.99 per month, and there are several other tiers and bundles to choose from. This new system launches on December 8, 2022. Bob Chapek recently commented that they “dramatically underestimated the hungry beast” of Disney+.
A new wave of price increases hit special experiences like private PhotoPass sessions, lightsaber and droid-building in Batuu. Disney Genie+ also increased based on a dynamic pricing structure.
Chapek’s Disney CEO journey starts to unravel after the quarterly earnings report. Disney fell short of expectations for profit and key revenue segments during the fiscal fourth quarter and warned strong streaming growth for its Disney+ platform may be slow going forward.
Shares of Disney fell roughly 8% in after-hours trading – in fact, during Chapek’s tenure, Disney’s stock fell 28% as the Dow rose 25% and the S&P 500 increased 27%.
Disney did report record results in its Parks, Experiences, and Products segment, with revenue increasing more than 34% to $7.4 billion during the quarter for the Walt Disney Parks division. But with Disney’s streaming services losing $1.47 billion last quarter, more than double the unit’s loss from a year prior, Chapek started to establish “a cost structure taskforce” and announced future layoffs for the company.
Friday, November 18, 2022
According to CNBC, Bob Iger was formally requested to return as CEO on Friday, November 18.
The board, through chair Susan Arnold, cited Disney’s negative earnings report and believed that Iger was “uniquely situated” to lead Disney. The New York Times further reported that Chapek had portrayed a “happy go lucky” mentality during the conference call held after the earnings report.
Arnold called Iger at 3 p.m. that Friday to offer him the job.
Sunday, November 19, 2022
Bob Chapek was not notified of his ouster until Sunday night. Chapek learned of the shock news at the same time as Disney’s announcement.
The board’s outreach to Iger and discussion to replace Chapek came after numerous internal complaints about Chapek’s leadership. Surprisingly, one of the executives to express a lack of confidence in Chapek was Christine McCarthy, well-regarded chief financial officer, according to both CNBC and the New York Times.
Iger sent an email to all Cast Members on Sunday to announce his reinstatement as Disney CEO.
Monday, November 20, 2022
Disney stocks rose 6%, while news emerged of Chapek’s potential exit pay with The Walt Disney Company.
Iger has agreed to serve as CEO through the end of 2024, and will earn a $1 million base annual salary, Disney revealed. The compensation package includes an annual bonus target of 100% of his annual salary, with an annual target of $25 million for a long-term incentive award.
Chapek had a base salary of $2.5 million, with an annual target of $20 million, which was increased from $15 million when his contract was renewed earlier this year. He is reportedly in line to receive a severance package of at least $20 million.
So, there you have it. The full timeline of Chapek’s role as Disney CEO and his ultimate firing. Only time will tell what the future holds for The Walt Disney Company.