Hello everyone. We will kick things off with Disney earnings. The discussion includes Iger’s strategy for Disney+ and how Disney is following an anti-Netflix strategy. We conclude with the ways Apple got paid video streaming right with Apple TV+. Let's jump right in.

Disney Earnings

It’s been nearly three months since Disney board’s brought Bob Iger back to replace Bob Chapek. Last week’s earnings release represented Iger’s first one back as CEO.

In what has been a recurring earnings theme with Disney, the Parks segment results were stellar (21% revenue growth and $3B of operating income) while Direct-to-Consumer experienced a $1.1B operating loss. Linear networks (U.S.) saw flat revenue and $0.9B of operating income, testaments to how legacy TV continues to hang on.

Here are Disney’s DTC subscription totals (as of December 31st, 2022):

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We kick things off with the big news from Disney. The discussion begins with Neil’s thoughts on why Bob Chapek got fired and what it tells us about Disney’s board. Attention then turns to the most surprising part of Iger returning as Disney CEO. We conclude with a look at Disney M&A and how Iger as CEO impacts the probability of Disney pursuing content M&A.

Hello everyone. Happy Monday.

We have big news from Disney that we will focus on today. There is a lot to talk about.

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Let's jump into today's update.

Disney Fires Bob Chapek

In what will turn out to be one of the top stories in the media space this year, here’s Disney:

“The Walt Disney Company announced today that Robert A. Iger is returning to lead Disney as Chief Executive Officer, effective immediately. Mr. Iger, who spent more than four decades at the Company, including 15 years as its CEO, has agreed to serve as Disney’s CEO for two years, with a mandate from the Board to set the strategic direction for renewed growth and to work closely with the Board in developing a successor to lead the Company at the completion of his term. Mr. Iger succeeds Bob Chapek, who has stepped down from his position.

‘We thank Bob Chapek for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the pandemic,’ said Susan Arnold, Chairman of the Board. ‘The Board has concluded that as Disney embarks on an increasingly complex period of industry transformation, Bob Iger is uniquely situated to lead the Company through this pivotal period.’

‘Mr. Iger has the deep respect of Disney’s senior leadership team, most of whom he worked closely with until his departure as executive chairman 11 months ago, and he is greatly admired by Disney employees worldwide–all of which will allow for a seamless transition of leadership,’ she said.”

The following chart likely played a major role in this announcement.

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