Walt Disney Co. CEO Bob Iger is sticking around for another two years, with his contract now set to expire on December 31, 2026, the company said on Wednesday.
"Time and time again, Bob has shown an unparalleled ability to successfully transform Disney to drive future growth and financial returns, earning him a reputation as one of the world's best CEOs," Mark G. Parker, Disney's board chair, said in a statement announcing Iger's contract extension.
Iger, who formerly led Disney from 2005 to 2020 before relinquishing the CEO role to his short-lived successor Bob Chapek, returned to the entertainment and theme parks giant in a shock move last November. Wall Street analysts and investors cheered the move at the time, hailing the return of a corporate leader they viewed as a steady hand after a bruising run for Chapek.
Iger pledged to prioritize finding a successor, but close watchers of the company, including former employees, predicted he would extend his contract again, given the company's internal troubles, the recent departure of its CFO, and industry challenges including the three-month Writers Guild of America strike that soon could see SAG-AFTRA, the actors' union, joining the picket lines.
"[T]here is more to accomplish before this transformative work is complete, and because I want to ensure Disney is strongly positioned when my successor takes the helm, I have agreed to the Board's request to remain CEO for an additional two years," Iger said in a statement. "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."
As part of the announcement on Wednesday, Disney said Iger's compensation will get a big boost. Under the extension of his contract, his "target annual incentive bonus" could be up to five times as large as it was previously, the company noted in a new 8-K filing.
Now, Iger will be eligible to receive up to 500% of his annual base salary, which is $1 million; whereas, under the terms of his contract announced when he returned in November, he was eligible to receive a maximum 100% bonus.
At the time, the company said Iger would also receive significant compensation through equity awards — namely, $25 million in Disney equity, with 60% of that manifesting as performance-based restricted stock units, and the other 40% being stock options, according to a November filing.
That means his total annual compensation could have reached a maximum of $27 million per year. Now, it stands to be potentially several million more.
Iger and Disney made several extensions to his previous tenure — originally set to step down in 2015, he renewed his contract four times before finally handing the CEO reins to Chapek in 2020 and transitioning to executive chairman. He exited that role in late 2021, only to take it up again less than a year later.
Asked in 2017, when his retirement date was extended from 2018 to 2019, about the continuing renewals, Iger told The New York Times, "I'm serious about it this time."
"Bob has once again set Disney on the right strategic path for ongoing value creation, and to ensure the successful completion of this transformation while also allowing ample time to position a new CEO for long-term success," Parker said.
