Ladies and gentlemen, thank you for standing by, and welcome to The Walt Disney Company Conference Call. At this time, all participants' lines are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Mr.
Lowell Singer, Senior Vice President of Investor Relations. Thank you. Please go ahead, sir.
Good afternoon, everyone, and thanks for joining us on short notice to A press release was issued about 30 minutes ago and is available on our website at www.disney.com/investors. And after the call, we will post a replay and a transcript of today's remarks on our website. Joining me for today's call are Bob Iger, Disney's Executive Chairman and Bob Chapek, Disney's Chief Executive Officer. Both Bobs will make some introductory comments, after which we will be happy to take a handful of So with that, let me turn the call over to Bob Iger. Thanks, Lowell, and good afternoon, everyone.
About a half an hour ago, we announced that Bob Chapek Has been named Chief Executive Officer of The Walt Disney Company effective immediately. I have assumed the role of Executive Chairman And we'll continue to direct the company's creative endeavors, while also leading the Board. This is an exciting day for Disney, a historic day, And I'm thrilled for Bob. I've worked closely with him for many years and have absolute confidence in his abilities as does the Board. As CEO, Bob will oversee all of the company's business segments and corporate functions, and we will work closely together Through the end of 2021 to further the company's strategic objectives and to ensure a smooth and successful transition.
Bob has been with Disney for nearly 3 decades. And during this time, he has achieved stellar results across a wide array of businesses. He is highly respected within Disney and throughout our industry for his visionary leadership, integrity, extensive knowledge of our businesses, as well as his willingness to take smart, thoughtful and innovative risks for the future. As President of Home Entertainment for the Walt Disney Studios, He spearheaded the highly successful Vault strategy that brought Disney's iconic films and characters to new generations of viewers. As President of Distribution for the studio, he directed the company's film distribution strategy and expanded our global reach across multiple platforms.
As Head of Consumer Products, he transformed the business, focusing it on our key franchises and embracing technological innovation to deliver unmatched consumer experiences. And most recently, as Chairman of Parks, Experiences and Products, We oversaw the largest capital expansion in the history of our parks that included the opening of Shanghai Disney Resort, A doubling of the Disney Cruise Line fleet and the creation of the new Star Wars: Galaxy's Edge lands at Disneyland and Walt Disney World. Bob has worked closely and collaboratively with leaders across the different segments of our company, and I'm confident he will apply the same vision, Passion and commitment to excellence in his new role as Chief Executive Officer. I've had the tremendous privilege of being CEO of the Walt Disney Company for the past 15 years and it's been thrilling for me to be part of such an exciting and productive era for our company. I'm enormously proud of all that we've accomplished creatively, financially and strategically, including the acquisition of 21st Century Fox And the incredibly successful launch of our direct to consumer businesses.
With these key endeavors well underway, I believe it's the right time to transition to a new CEO and having worked closely with Bob for many years, I believe he is absolutely the right person To assume this role and lead our company in this next pivotal period. I'm certain that under his leadership, our portfolio of great businesses And our amazing and talented people will continue to serve our company and our shareholders well into the future. I congratulate Bob and look forward to working with him and the other members of our amazing leadership team. And with that, I'll hand it over to him to say a few words.
Thanks, Bob, and hello, everyone. It's a tremendous honor for me to assume the role of CEO of The Walt Disney Company. I'm humbled by and deeply appreciative of this opportunity and I'm enormously grateful for Bob and the Board's confidence and strong support. I've had the opportunity to watch Bob lead this company to amazing heights over the past 15 years and I've gained invaluable insight and experience As a member of the senior management team during this incredibly dynamic period, Bob, I feel very fortunate to be able to work closely with you during this transition as I assume this new role and delve deeper into our businesses and operations and I know I'll benefit greatly from your wisdom and expertise. I've been lucky and privileged to work for this company for 27 years and whether I was at Studios as the Head of Home Entertainment or Distribution, On the retail side of the business within consumer products or overseeing Disney Parks' experiences and products, I've always felt like I had the very best At Disney, our mission is simple, to entertain, inform and inspire people around the globe Through the power of unparalleled storytelling, storytelling is at the heart of everything that we do and I believe we do it better than anyone and that's reflected in the strong connection that we share with fans and consumers worldwide.
My priority as CEO Working with our incredibly talented management team is to continue the growth and stewardship of this great brand while preserving its rich legacy. I share Bob's commitment to creative excellence, technological innovation and international expansion and I will embrace these same strategic pillars Going forward, we will continue to pursue bold innovation, thoughtful risk taking and the creative storytelling that is the lifeblood of our company and our achievements to date will serve as the foundation for the future. I also want to say how proud I am to be working alongside our Exceptional cast members and employees who will make it all happen every day around the world. Without question, they are Disney's greatest assets and the key to our success. When I was growing up in Hammond, Indiana, the son of a World War II veteran and working mother, My parents would take us on a family vacation to Walt Disney World every year.
That's where I first developed a deep love for Disney and all that it stands for. That young boy could have never imagined that one day he would get the chance to lead this extraordinary company as the 7th CEO In its nearly 100 year history. Again, I want to thank the Board and Bob for their confidence in me. I can't wait to get started. And with that, I'll turn it back over to Lowell, and Bob and I will be happy to answer your questions.
Okay. Thanks, Daniel. And with that, we would be happy to take a few questions. So we'll be ready for the first
Our first question comes from Ben Swinburne with Morgan Stanley. Your line is now open.
Hi, good afternoon. I know this might sound a bit comical to ask the question this way, but why now to Bob Iger and whether the announcement was accelerated for any reason? I know you I had a number of almost 2 years left, but at the same time, I've delayed this decision for some time. So I just wanted to get your comments on the timing. And then for Bob Chapek.
Bob, could you talk a little bit about your views on the businesses that you haven't spent time running, in particular, The direct to consumer business and media networks and how you look at the future of those businesses now that you've got this expanded role? Thanks to both of you.
Thanks, Ben. Bob Iger, good question on the timing. As you know, we recently Acquired 21st Century Fox, closing the deal sometime in 2019, and then we deployed our new direct to consumer strategy with the launch of ESPN Plus and then Disney Plus. So the company has gotten larger and the company has gotten more complex just in the recent 12 months. And I felt that with the asset base in place and with our strategy Essentially deployed that I should be spending as much time possible on basically the creative side of our businesses Because with the asset base in place and the strategy in place, that becomes the biggest priority.
And in thinking about What I want to accomplish before I leave the company at the end of 'twenty one, getting everything right creatively would be the number one my number one goal. I could not do that if I were running the company on a day to day basis. It just obviously takes that much time and is so complex. And so the goal was for me to Turn over the day to day management of the company to Bob with direct authority over all of our businesses and basically all elements of the company And free me up just to basically focus on the creative side. It was really that simple.
It was not accelerated For any particular reason other than we felt the need was now to make this change. We've been engaged as a Board In a really comprehensive and very serious succession process, and we have identified Bob Actually, quite some time ago, as a likely successor to mine, and with everything else falling in place, the time seemed right. This gives him the opportunity also to Work with me over the next number of months to create the smoothest possible transition so that when I leave, He will be familiar with all elements of the company, not just those that he's already managed, but those that he will now begin to manage in his new role.
And in terms of your question about the businesses that I've not managed, Bob has been great in terms of giving me exposure across many segments of the company, Spent 19 years in the studio, then moved on to consumer products and then on to parks. So I've had probably a fairly broad overview of how the company operates regardless of the different industries that we work in. That said, obviously, I've not spent as much time on the media side or direct to consumer side, But we have some really great experienced leaders that are in place in those businesses. And the way that Bob essentially manages his direct team is that We have a lot of cross fertilization. We meet every single week and discuss each other's businesses.
And so, while I certainly have an opportunity to immerse myself more inside those media businesses, To immerse myself more inside those media businesses, I have a bit of fluency, just like my peers have some fluency in our business And I'm familiar with the opportunities and some of the challenges that they all face.
Great. Thank you, guys.
Ben, thanks for the questions. Operator, next question please.
Thank you. Our next question comes from Alexia Quadrani with JPMorgan. Please proceed.
Thank you very much and congratulations, I guess, to Bob I guess to both Bobs here. I guess, first question on to Bob, Iger, you mentioned getting everything right creatively, going forward. Is that working closer with the Fox So it's really across the board. I'm not sure if you could be any more specific than that, but that would be helpful. And then to Bob Capic, I guess probably not a fair question given it's day 1, but What do you see as the biggest challenge and sort of the biggest hurdles ahead?
So much of what we created the company from a value This perspective emanates from creativity across basically all of our businesses and globally. And so my intention is to really spend time on all of our creative endeavors, whether they're at ESPN or at the Fox Studios or at our media networks, our newly acquired businesses like Hulu, for instance, or Disney plus there's ample amount for me to focus on and
And in terms of the biggest challenges that we might have going forward, Obviously, each one of our businesses, just like every business in the world, is experiencing disruption, disruption because of new technologies, New ways that consumers are choosing to enjoy our products, and we want to stay in the front end of that wave, which is why we implemented our direct to consumer strategy with Disney plus and ESPN plus So I think the challenge going forward is going to be How do we continue to have a leg up on our competition and understand when the market is changing and stay ahead of that so that we're Proactively transforming as opposed to in any way reacting.
Thank you.
Thanks, Alexia. Operator, next question, please.
Thank you. Our next question comes from Michael Nathanson with MoffettNathanson. Please proceed. Thanks.
Congratulation to both of you guys. So firstly for Bob Chapek. Question I have for you is, for those that don't know you, given your background and your experiences, what do you see as kind of your chief Accomplishments, skill sets that will help you in this pivot to DTC. So that's 1. And then 2 is for both of you, Given Bob Iger, you're focused on all facets of the job, creative strategy and the business aspects, I wonder, do you see a role going forward for maybe a Chief Creative Officer at Disney That's below the CEO.
Is that potentially what could happen as you leave Bob Iger? So those are my questions.
Okay. I feel that I know the company extremely well. And even before I joined the company, I started off in advertising, I went into consumer packaged goods and then went into essentially packaged goods of our media. So everything in my career Has been a consumer oriented business. That's where I've played.
So the idea that now I'll be able to take that background and experience, Including everything that I've done in consumer products and in our parks and now employee to a direct to consumer business Feels like it's well within my wheelhouse.
And with regard to your question about a Chief Creative Officer, no. I actually intend to work very closely with Bob as I direct the creative efforts of the company. My goal is that when I leave here, he'll be just as steeped in All matters creative at the company as I am today. And I thought if we were to either give me the title of Chief Creative Officer or name someone, It would imply that we had a need, and I don't think that's the case.
Okay. Thanks. Thanks, guys.
Hey, Michael, thanks for the questions. Operator, next question please.
Thank you. Our next question comes from Jessica Reif Ehrlich Bank of America Merrill Lynch, your line is now open.
Hi. Maybe kind of a follow on to one of the questions already asked. But Can you talk about the opportunities as you see them when Bob Iger took over? I remember Monday Night Football quickly went to ESPN, strategic planning, Back to the divisions, you bought Pixar and solved the Steve Jobs relationship. Are there any opportunities or any structural changes that you see?
And on the challenge front, There's a lot coming up besides the direct to consumer international rollout. There's NFL. You've got coronavirus spreading at a theme park business. Can you just talk about priorities and how you see some of these things shaping up? Thank you.
Okay. In terms of structural, obviously, it's very early. We just had a fairly major Reorganization that took place about a year ago when we completed the Fox acquisition and when we went into the direct to consumer business. So I think a lot of that heavy lifting has already been done, and now it's just going to be a question of refining that. So I think that's really where we're at.
And in terms of the second part of the question, Bob's 3 strategic pillars are very well entrenched in this company and Those have been something that served us well in dynamic marketplace. And I think that we're really going to stay with the general gist of Those strategic pillars and again, keep an eye out for a dynamic marketplace where if the need to change arises, it's something we'll reevaluate. But frankly, I think we're the envy of the industry in terms of how consistent we are with our strength of our pillars, and
Okay, Jessica. Thank you for the question. Operator, next question please.
Thank you. Our next question comes from Steven Cahall with Wells Fargo. Your line is now open. Thank you. Maybe first question for me.
I was wondering if
you can talk about the Board's process.
Disney certainly has a story
David, it's very hard to hear you.
There's a lot of background noise. We can't hear your question. Steve, so it looks
like you
Sorry about that. Okay. Try again.
Yes, sorry about that. Not in the office. I was just wondering if you could talk us through the Board's process for reviewing internal and external candidates,
Well, we have we're extremely fortunate that we have in Bob someone that knows the company extremely well that we know So well, he's been in the company for 30 years and worked in 3 different businesses of ours. And so, while the Board obviously did its duty in basically conducting a thorough process, We were all felt very, very fortunate to have a candidate in Bob that is as experienced and as knowledgeable of our company and our businesses as he is.
Steve, thank you. Operator, we have time for one more question.
Thank you. And our final question comes from Tuna Amobee with CFRA. Please proceed.
Hi, can you hear me?
Yes, we can, Tien Tsin.
So thanks for the call. So Bob, I was kind of I think about over the last several years, The extensions that you had and all of the things that have happened, and I just wonder, in terms of This announcement, why you kind of feel like This is the right time. And as far as the new role that you will continue, you said it's going to be mostly creative. Does that suggest any kind of should we expect any kind of Major strategic diversion as you kind of as Bob Chepek, transitions into this role.
It's actually quite simple, Tunna, just in terms of Why we made the decision now is essentially, I think, what you're asking first. We asked ourselves 2 things, how best to manage the company today And how best to manage succession and transition. And we feel that this change gives us the ability to manage the company Much more effectively, by essentially giving Bob responsibility over the day to day operations and enabling me to concentrate on what's Very important. It also sets up, we think, a great transition process that will lead to Basically, Bob, taking over the company fully when I leave and at that point being far better versed in All of the company's businesses and creative endeavors. So it just made sense.
It's just that simple. It's how best to manage the company And the best possible succession transition process. And in terms of whether this signals anything else, as Bob indicated, The strategic pillars that were put in place a while ago still stand in terms of our priorities. They've served us quite well over this period of time. Obviously, this is a changing marketplace.
Bob referenced the disruption that exists in our world, and he'll watch that just as closely as I have in my tenure and make adjustments to the company strategically when he sees fit to do so. But for now, we don't feel that we have any sense of urgency or any real need To change course, except for the way in which we manage our businesses.
Thank you very much, and congratulations to you both.
Thanks, Tunna. Tunna, thank you for the question, and thanks again, everyone, for joining us on such short notice today. Certain statements on this call about expectations for The future may constitute forward looking statements under the securities laws. We make these statements on the basis of our views and assumptions regarding future events and business performance at the time we make them, and we do not undertake any obligation to update these statements. Forward looking statements are subject to a number of risks and uncertainties, and actual results may differ materially From the results expressed or implied in light of a variety of factors, including factors contained in our annual report on Form 10 ks, quarterly reports on Form 10 Q and in our other filings with the Securities and Exchange Commission.
This concludes today's call. My team will certainly be available today and over the coming days follow ups, we look forward to talking to all of you. Thanks.
Ladies and gentlemen, this concludes today's conference call.