The Walt Disney Company is known for its prodigious business acumen and high-profile acquisitions. Last year, Disney’s annual profit came in at $8.4 billion, an incredible climb from $3.4 billion in 2006. Since Robert A. Iger began his role as chief executive in 2005, the company acquired Pixar, Marvel Entertainment, and Lucasfilm. In the last year, Disney released four movies, which generated $1 billion in global ticket sales, and this past June, Disney opened the $5.5 billion Shanghai Disneyland. These projects led to an increased share price of $31 in 2006 to $122 in August 2015.
Despite these recent achievements however, shares are already down to $93 (and dropping) and many are questioning how Iger intends to promote Disney’s next growth spurt. Investors have noted challenges facing continued growth through ESPN, leading many to speculate that Iger’s next major acquisition is in the works.
There have been rumors of Iger’s interest in Vice Media, Spotify, Netflix, and Twitter. Some analysts believe that Twitter could be Disney’s best bet to support ESPN with live mobile video streaming and to reinforce Iger’s growing technology pursuit. However, there has been a strong negative response to this potential acquisition. Twitter’s “Thursday Night Football” live stream performed significantly below that of CBS and the NFL network. Additionally, Twitter may not be the most logical fit. There is concern that Twitter’s user-generated content could have an adverse effect on Disney’s family-friendly, PG image. Alternative journalism source, Vice Media, poses similar concerns.
To some it seems that Disney has bigger challenges than its “next big move.” There is no succession plan following Iger’s retirement in less than two years, Disney’s broadcast network, ABC, is in dire need of a hit show, and its consumer products division is on a serious decline.
Others contend that there is no reason to be concerned about what appears to be a stall in success. Analyst Michael Nathanson notes that Disney still remains stronger than its competitors and has megahits just around the corner, including the next “Star Wars” installment and a live-action “Beauty and the Beast.” Disney’s theme parks were hardly impacted by the recession and are expected to open new attractions in the near future.
Still, Iger’s pattern of major acquisitions roughly every three years has analysts anticipating a significant move very soon. Without any obvious avenues, though, it is unclear what Disney will turn to next.