Disney just extended Bob Iger's contract for two more years, through 2026, the company announced Wednesday.
The move comes as the CEO has been restructuring and making widespread cuts in a bid to steady the company amid a disruptive and costly shift to streaming and broader economic headwinds.
Iger told CNBC on Thursday that while he's accomplished a lot, he and the board agreed there was much more to do, and that staying longer would give other execs time to develop themselves, a potential reference to the need to find Iger's eventual replacement. He acknowledged he might have been "unrealistic" about his ability to address the company's challenges, including a linear TV business that's declining faster than expected. "That's part of the reason I'm staying. There's a lot of work to be done."
The news that Iger's sticking around will come as far less of a shock to the entertainment industry than his return to the CEO role last November, ousting Bob Chapek, whose brief tenure was marked by missteps with the Hollywood creative community and internal dissatisfaction with the company structure.
Iger pledged at the time to prioritize finding a successor, but he has extended his contract before — four times during his first 15-year tenure.
And close watchers of the company, including former employees, have been predicting that Iger would extend his contract again, given the company's internal troubles, the recent exit of its CFO, and industry challenges including a three-months-and-counting strike by the Writers Guild of America — with SAG-AFTRA, the actors' union, poised to potentially join the scribes on the picket lines tomorrow.
Dave Heger, a senior equity analyst at Edward Jones who covers Disney, told Insider in late June that the lack of any announcement about succession was pointing to an Iger extension.
"If we start getting much beyond a year of Iger being onboard and not having an indication of a successor, yeah, that would be of some concern to me, and I think the investment community would get more anxious," Heger said.
That anxiety may be assuaged by Wednesday's news, but Disney still faces significant challenges. Iger cut 7,000 jobs this spring in a bid to save $5.5 billion in costs as the company faces cord-cutting and declining TV ad revenue.
As one former Disney executive put it, Iger is highly motivated to protect his own legacy, and if he stuck to the original timeframe of two years, it would signal he felt there were problems in the company he couldn't fix. This person and others with ties to Disney spoke to Insider in recent weeks, ahead of today's announcement, and requested anonymity to protect their company and industry relationships.
Longtime TV and media industry consultant Christian Knaebel suggested to Insider that Iger would be justified in extending his contract by the recent exit of CFO Christine McCarthy, because it would behoove the CEO to fill those shoes and help her successor learn the role. Some in the entertainment industry speculate Disney could one day merge with a bigger media or tech company, and it'll need a strong CFO in place to help manage such a deal.
Finding a replacement is 'top priority,' Iger said — here's who could be in the running
Succession remains a top priority for Iger, as he emphasized in his statement accompanying Disney's announcement of his extension. "The importance of the succession process cannot be overstated, and as the Board continues to evaluate a highly qualified slate of internal and external candidates, I remain intensely focused on a successful transition," he said.
Before Chapek was selected to take the reins from Iger in 2020, multiple other Disney executives were eyed for the role, including Jay Rasulo, Kevin Mayer, and Tom Staggs, but each exited after being passed over. Iger was said to regret the choice of Chapek.
Recent speculation has centered on Dana Walden, who got a boost when Iger named her, alongside longtime Disney film exec Alan Bergman, to lead Disney Entertainment — one of three core units that emerged from Iger's reorg announced in February.
Disney's recent Pixar flop, "Elemental," shows clearly the need for an exec at the helm of the company who understands creative and franchises. "Dana is uniquely one of the best if not the best at this moment in time of being a creative television and programming executive," said a media exec who's close to the company.
"When I look at where the biggest challenges in the business are right now, I would have to think they would look more towards somebody who has the media background and content background," Heger said.
Bergman also is seen as a contender, but Iger is said by insiders to like the idea of naming Disney's first female CEO. If Iger does favor Walden, sticking around two more years gives him time to train her in areas where she has less experience, such as Disney's massive and profitable theme park business.
Other than Walden and Bergman, names that have been floated as successor contenders include ex-Meta execs Sheryl Sandberg and Carolyn Everson (who's on the Disney board); Disney alum Kevin Mayer; the company's parks chief, Josh D'Amaro; and ESPN president Jimmy Pitaro.
A flurry of reports earlier this year pointed to Adam Silver, the National Basketball Association commissioner, as a candidate, but Silver firmly shut down that notion. Two people who spoke to Insider shared speculation that Andrew Wilson of EA could be a candidate for CEO or at least to run ESPN.
Disney representatives did not respond to Insider's request for comment.
