Unlock Editor’s Digest for free
FT editor Roula Khalaf selects her favorite stories in this weekly newsletter.
Movie audiences like short films. The optimal length, a survey found this year, it is about 90 minutes. Nobody understands it better than Walt Disney: its summer premiere Inside out 2he highest collection animated movie of all time, lasted 96 minutes. That is why it is disconcerting that the company’s own drama has dragged on so painfully.
As an illustration, Disney stock is priced the same as it was a decade ago. However, in that time a lot has happened. The cruise ship cable TV empire bought parts of 21st Century Fox for $71 billion and invested billions in a streaming service, Disney+. Boss Bob Iger retired and then returned; Goals were set that were later not achieved. In 2020, Disney estimated that by 2024 it should have up to 260 million paid streaming subscribers. In fact, it has accumulated 159 million.
A 6 percent rise in company shares after Disney reported third quarter earnings Thursday suggests a change of pace. The streaming division increased its revenue 15 percent year-over-year and posted its second profitable quarter. Theme park revenue, a third of Disney’s total revenue, was flat but expected to rise. The company’s traditional television networks are withering, but investors accepted that reality a long time ago.
Iger now also announces a happier future, with unusual details. Disney says it will grow adjusted earnings per share by single digits next year, and then by double digits over the next two years. The figure to beat is $7.08, last seen in 2018, when the kingdom was still making magic. Analysts surveyed by LSEG expect $6.50. However, the company recognizes that driving growth will depend on prices rising.
Thinking about profitability in 2027 has a whiff of fantasy, because Iger himself will already be gone by then. Incoming Chairman James Gorman, a former head of Morgan Stanley, has committed to finding a new CEO by early 2026. With any luck, it will happen sooner: Gorman is an entrepreneur, and the board has been actively searching for Iger’s successor. since at least January. 2023.
Disney’s positive earnings projections make the wait seem less torturous. But investors deserve better. Boeing, a much more troubled company, found a new boss, Kelly Ortberg, four months after Dave Calhoun said he was resigning. HSBC, a growing bank, took three months to choose Georges Elhedery as its new broom. Disney knows how to keep the action moving, except when it comes to its own protagonist.