Bob Iger has his hands full amid falling stock prices and activist battles: Former Disney CEO
disney (Dis) CEO Bob Iger has faced many challenges since then Return to the position of CEO Nearly one year ago — but he’s well-equipped to handle it, according to former streaming president Kevin Mayer.
“Bob is very busy,” Mayer, who now runs Blackstone-backed entertainment startup Candle Media, said at the Yahoo Finance Invest conference on Tuesday.
Disney shares are at multi-year lows, and activist investor Nelson Peltz is pushing for multiple board seats at the company. the The company’s gardening works Slow down, her Linear Television Department It is declining, and its live streaming business is not yet profitable.
“Someone like Bob, he’s very capable, he’s multi-faceted,” Mayer continued. “He has a wide range to be able to handle it. Not everyone can handle a situation like that. But I think you have to be disciplined, and Bob was always very strategic.”
Mayer, who currently serves as a strategic advisor to Iger, added that his former Disney boss “will look at all his options” and ultimately make the decision that best benefits shareholders.
“When you do the right things strategically in the long term that don’t hurt you too much in the short term, I think you can work through those multiple issues,” he said.
Disney shares have seen a roughly 3% decline since the beginning of the year, far underperforming the Standard & Poor’s (S&P) index.^ GSBC) Profit of 14% during the same time period.
The stock is reacting to many uncertainties — from the future of Hulu and ESPN to the ultimate fate of linear networks — but Disney has begun to address some of those challenges, Mayer said.
“When the stock price rises and [Iger] “It crystallizes a great strategic vision — one that will address most of the problems,” he said.
The company also raised broadcast prices For the second time this year, Increase the monthly price From Disney+ and Hulu’s ad-free plans by more than 20%. Mayer said he believes streaming will reach profitability “very, very soon” while gaming is an untapped area that the company will be able to capitalize on in the future.
“No matter what happens to those linear networks, you have a really great growth company sitting there — [it’s] “Really bright future,” he said.
Who would buy a linear TV company?
Iger said earlier this summer that the company would take An “expanded” look at the entertainment giant’s traditional television assetsWhich indicates the possibility of selling it.
Analysts He doubted Who will want to buy them given the chronic declines in linear TV as more consumers cut cords or drop their cable packages.
Mayer said he’s not sure who would ultimately buy a network like ABC, but he said one upside to linear companies is their profit margins, which often range from 30% to 40%, sometimes more.
“Streaming will never reach that level of profitability,” he said, noting the existence of a profitable streaming company like Netflix (NFLX) Margins are likely to be leveraged in the 25% to 30% range.
Looking ahead, the executive said that Hollywood-focused digital players may make more sense as buyers of such assets — especially given the competitive environment and potential for consolidation.
“You could see consolidation happening between these major media companies, and you could see Warner Bros. (WBD) with a combination with NBCUniversal or with Paramount – there are some combinations out there. Starz still Sit there Owned by Lionsgate. “That has to be reinforced with someone, maybe a big digital player or a Hollywood player.”
It’s even possible to acquire Mayer’s company Candle Media. Mayer laid out three visions for the entertainment company: an acquisition by a strategic buyer such as Disney or Warner Bros. Discovery, a public offering, or a sale to another private equity firm.
“Who knows, maybe KKR will own us in three or four years,” he said. “But we are ready for any of them.”
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