Disney CEO Chapek's Contract Extended For 3 Years

After a turbulent couple of months, Bob Chapek, chief executive officer of Walt Disney, has had his contract extended for another three years by the company's board of directors.

“Disney was dealt a tough hand by the pandemic, yet with Bob at the helm, our businesses — from parks to streaming — not only weathered the storm, but emerged in a position of strength,” said Susan Arnold, Disney Chairman, in a statement on Tuesday.

Disney stock is down 45% year-over-year to $96.46.

Chapek also faced heavy industry criticism after his ousting of Peter Rice, chairman of Disney General Entertainment Content. Some executives said it was an outright firing.

Rice, a highly respected long-time executive who came over with the Disney acquisition of the Fox Television business, was not given a reason. One report says Rice was told he was not the “right fit.” Other reports suggest Rice could have been perceived as undermining Chapek.

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Prior to this, Chapek was criticized for his low-key, underwhelming response to Florida's “Don't Say Gay” bill. Orlando, Florida has been the long-time home to Disney theme-park operations in the state for decades. A senior Disney communication executive, Geoff Morrell, was dismissed as a result.

Days after his muted response, Chapek then slammed the bill during the company's shareholder meeting, saying the company would be donating $5 million to protect the LGBTQ+ community.

Just over a week ago, the Disney-Pixar animated film “Lightyear” -- now part of the big “Toy Story” franchise -- had an underwhelming theatrical opening, pulling in $51 million in North American box-office revenue for its opening weekend. That placed it 18th among all Pixar movie-opening weekends.

Streaming has been a major focus of Disney's performance. Late last year, Disney warned of some softness in the business -- registering only low-single digit subscribers gains of 2.1 million global customers in the fourth quarter.

The company's first-quarter 2022 period showed much better results -- adding 7.9 million subscribers.

Disney is working on an ad-supported option for Disney+ to start up later this year.

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