Shortly after the announcement that Disney CEO Bob Iger had extended his tenure for an additional two years, he surprised the media world by revealing several shocking insights during an interview with CNBC earlier this month.
Speaking with David Faber on the network’s “Squawk Box” program, he discussed the “transformative” work he has begun before he hands off the company to a successor which now, at least, won’t be until sometime in 2026.
“Transformative work is dealing with businesses that are no growth businesses and what to do about them, and particularly the linear business, which we are expansive in our thinking about,” Iger told the host. “And we’re going to look expansively about opportunities there because clearly, it’s a business that is going to continue to struggle.”
Faber stopped Iger at that point to ask if by ‘transformative’ he meant getting rid of legacy networks like ABC and FX: “Are you going to look to sell them?”
“We have to be open-minded and objective about the future of those businesses, yes,” Iger replied.
“Meaning that they’re not core to Disney?” Faber pressed on.
“That they may not be core to Disney,” Iger added. “The distribution model, the business model that forms the underpinning of that business and that is delivered great profits over the years, is broken. And we have to call it like it is.”
He made it clear that his remarks were not directed at ESPN, which, according to him, Disney perceives “very differently.” However, he emphasized that ABC, National Geographic, and other Disney-owned entities might be at risk of being sold off in the near future.
A sell-off of ABC could certainly have a negative effect on some of the network’s legacy programs, including the daytime gabfest “The View,” which is often highly controversial.
Earlier this year, reports noted the ongoing financial challenges faced by Disney, many arising from a string of decisions related to “woke” content and a well-publicized clash with Florida Gov. Ron DeSantis (R), who is currently trailing former President Donald Trump in the GOP polls for the 2024 presidential nomination.
Reportrs noted in April that Disney had begun planning for lay-offs of as much as 15 percent of its entertainment workforce following an announcement by Iger two months earlier that they were coming.
The CEO unveiled plans to idle 7,000 workers in a “strategic realignment” aimed at cost reduction. The layoffs were expected to impact workers across various divisions, including television, film, theme parks, corporate, and entertainment, Bloomberg News reported at the time.
“For our employees who aren’t impacted, I want to acknowledge that there will no doubt be challenges ahead as we continue building the structures and functions that will enable us to be successful moving forward,” Iger told staff members in March. “In tough moments, we must always do what is required to ensure Disney can continue delivering exceptional entertainment to audiences and guests around the world, now, and long into the future.”
Under Iger’s strategic shift, where the focus was placed on prioritizing franchise properties and well-established brands, it was initially anticipated that the company’s entertainment unit would be the most affected by the layoffs. However, recent developments suggest that this situation might have evolved or shifted in some way.
Apart from the layoffs, Disney is enacting a restructuring initiative within its finance department. This plan involves a more integrated approach, bringing together the teams responsible for managing accounts for Disney Entertainment and ESPN. According to a memo obtained by Business Insider, Bryan Castellani was designated to take on the role of finance lead for both business units, working under the guidance of Disney CFO Christine McCarthy.
In May, Disney stock tumbled nearly 9 percent — the most significant drop in six months — which sent shockwaves through the company
“The report was the first since Disney announced its new three-pronged business reorganization — Disney Entertainment, ESPN, and Disney Parks, Experiences and Products,” Yahoo! Business reported at the time