Disney’s (DIS) search for its next CEO will reach a fever pitch next year, with the media and entertainment giant set to announce a new chief in early 2026.
KAPOLEI, HAWAII – NOVEMBER 21: Bob Iger poses for a photo as he attends the world premiere of ‘Moana 2’ at Lanikuhonua Cultural Institute on November 21, 2024 in Kapolei, Hawaii. (Photo by Darryl Oumi/Getty Images) ·Darryl Oumi via Getty Images
With James Gorman set to succeed former Nike CEO Mark Parker as chairman of Disney’s board effective Jan. 2, the succession process has been routinely branded a “critical priority” for the new year.
Gorman, who oversaw his own succession process at Morgan Stanley, first joined Disney’s board in February — just two months before the company successfully fended off activist investor Nelson Peltz. He has led Disney’s succession planning committee since August.
But more recently, speculation has shifted to outside names.
“I would assume that they are actively looking externally,” Macquarie analyst Tim Nollen told Yahoo Finance in an interview. “James Gorman is certainly external. He only joined the board a year ago himself, so I am quite sure they will actively look outside of the company.”
LOS ANGELES, CA – JUNE 10: EA CEO Andrew Wilson speaks during the Electronic Arts EA Play event at the Hollywood Palladium on June 10, 2017 in Los Angeles, California. The E3 Game Conference begins on Tuesday June 13. Wilson is reportedly being considered for the top job at Disney. (Photo by Christian Petersen/Getty Images) ·Christian Petersen via Getty Images
A recent report from the Wall Street Journal said Disney is interviewing a pool of external candidates, including Electronic Arts (EA) CEO Andrew Wilson. EA did not respond to Yahoo Finance’s request for comment on the rumored discussions. At least two other outside candidates are also being considered for the top job, according to the outlet.
Historically, Disney has almost exclusively promoted internally, with the last three CEOs rising through the ranks of the media behemoth.
“That’s kind of in their nature to do things that way,” Nollen said. “But Disney is a big, sprawling company, and the internal candidates have run their independent, individual divisions, not the broader Disney.”
“So, can a person who runs parks also run the networks? Can a person who runs streaming or ESPN also run the parks? I don’t know if that’s the best move to make,” he cautioned. “I’m not saying it isn’t. I just don’t know what the best move is.”
To that point, according to the Journal, Disney discussed a dual-CEO strategy, which has worked well for competitor Netflix (NFLX). But that scenario could quickly unravel, as Disney’s leadership team hasn’t traditionally operated under that structure.
“Netflix was able to do it because they were all brought up that way together,” Nollen said. “And I’m not saying Disney is [not capable], but I don’t know if the top internal candidates were brought up in the same way.”
Finding the next CEO has been one of the company’s most important priorities after Bob Chapek’s succession disaster nearly five years ago.
“I think it would be safe to assume that I think about [CEO succession] all the time,” Iger said on a podcast with Kelly Ripa earlier this summer. “I could say that ‘I’m obsessed with it’ would be probably an understatement, and actually, the board and I established when I returned that that would be among our biggest, if not our biggest, [priorities].”
“It was not my intention to be pulled back in,” Iger told Ripa about returning to the chief executive role. “I owed it to the company that meant so much to me and had been so good to me to answer the call.”
And although shares have recovered from last year’s multiyear lows, the stock has still underperformed the broader market. Shares are up about 25% since the start of the year against a 27% gain for the S&P 500.
Shareholders have also grown concerned over a potential slowdown in Disney’s theme parks business as prices rise and demand wanes. In August, the company underperformed expectations at its domestic parks, reporting a 6% year-over-year drop in profits for the three-month period ending June 29.
Cruise ships, meanwhile, are poised to be a lucrative opportunity over the next five years — and will serve as yet another area of the business the incoming CEO will have to foster.
But overall, the strategy for Disney has already been set thanks to Iger’s return.
“The next person just has to come in and carry things along the way Iger has set them up,” Nollen said. “It’s simple: Don’t let the wheels fall off.”
