Iger yesterday confirmed media speculation that he could stay beyond his scheduled 2018 departure, even as the entertainment giant posted a 3% drop in first-quarter revenue. “While I’m confident that my successor is going to be chosen on a timely basis and chosen well, if it’s in the best interest of the company for me to extend my term, I’m open to that,” he told analysts on a conference call.
Disney’s top line was pressured by falling viewership and advertising revenue at sports channel ESPN, which, like other cable networks, is struggling to compete with online offerings. Disney also was partly a victim of its own success: it was always going to be hard to sell more tickets and film merchandise after the roaring success in late 2015 of Star Wars: The Force Awakens.
Earnings from the company’s movie business nevertheless remained buoyant, as the seemingly risky acquisitions of Pixar, Marvel and Lucasfilm continued to bear fruit. Success is coming in the form of a string of $1 billion-plus box office smashes, including the recently released Rogue One: A Star Wars Story.
Iger took the helm of Disney in October, 2005 and by January 2006 the company had bought the Pixar animation studio from Apple co-founder Steve Jobs for a cool $7.4 billion. The $5 billion acquisition of the Marvel comic book film franchise followed in 2009. Then in 2012 came the $4 billion acquisition of Star Wars franchise owner Lucasfilm.
“They seem to have a finger on the pulse of what the public wants at a level that I haven’t seen before,” Barton Crockett, an analyst at FBR Capital Markets told Bloomberg last year.
Despite going through a recent bumpy patch, Disney shares have more than quadrupled in value since Iger took charge. To send them higher, he’s hoping to combat falling cable TV revenue with yet another acquisition: last year, Disney bought a third of BAMtech, which helps companies deliver content, including sporting events online.
And Disney’s stellar performance at the cinema box office also will have to prove to be a consistent flow, rather than a one-off winning streak—no small task for such a creative industry.
Yesterday, Iger told analysts that the company stands by its record: over the past decade he said 30 films made at Pixar, Marvel and Lucasfilm had averaged about $800 million each at the global box office.
“So we don’t think that there’s a coincidence to this,” he told analysts. “We think that we’ve done a really great job of de-risking the business.”