Bob Chapek is out as chief executive of Disney (DIS), the company said late Sunday, a leadership shakeup that nearly two weeks ago we began to champion as necessary to get the entertainment giant back on track. We’re pleased to see Bob Iger is returning to the CEO role nearly three years after he vacated it , and the market agrees as Disney shares surged more than 9% in premarket trading Monday morning. Iger’s reappointment, which is effective immediately, also comes about 11 months after he stepped down as Disney chairman . Chapek was Iger’s hand-picked successor, but investor confidence in Chapek had begun to wane in recent months as Disney shares struggled to find momentum and losses in its streaming division mounted. After Disney’s terrible fiscal fourth-quarter results Nov. 8 , the Club felt no choice but to call for Chapek’s ouster. Jim Cramer doubled down on the need for a CEO change Thursday during the Club’s November “Monthly Meeting,” correctly predicting that Disney shares would surge on news that Chapek was replaced. Disney said Chapek stepped down. Chapek’s tenure was set to run to July 2025, after Disney’s board unanimously approved a three-year contract extension in late June . Iger has committed to serve two years as CEO and agreed to help the board develop his eventual replacement, according to Disney. Iger previously led Disney from 2005 to 2020. The Club’s take Iger will be the steady hand Disney needs in this critical moment. He is a well-respected, effective communicator. We expect him to be much more thoughtful in terms of navigating cord-cutting at the company’s media division and positioning the streaming business toward profitable growth. When Disney reported that awful quarter earlier this month that showed its expenses and operating losses were too high, we voiced our frustration about Disney leadership. The quarter made it clear that Chapek’s strategy was not working and a change at the top was necessary to return this great franchise to its winning ways. If you listened to our November “Monthly Meeting” last week , you would have heard how passionate we were about Chapek’s removal being in the best interest of shareholders. We said Disney shares would immediately pop on his firing because he had shown he was too incapable of running a company of Disney’s scale. We are pleased to see the board listen to its shareholders and make a switch at the top. As good as Chapek was operating the theme parks through the Covid pandemic and into the reopening with record margins, Disney at its heart is a creative company and he did not have the creative chops to lead. (Jim Cramer’s Charitable Trust is long DIS. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Bob Iger, CEO, The Walt Disney Company
Scott Mlyn | CNBC
