It’s rare for Disney (NYSE:DIS) Chief Executive Bob Iger to acknowledge his company has had creative missteps. So when he does, it’s probably wise to pay attention.
“As I’ve looked at our overall output, meaning the studio, it’s clear that the pandemic created a lot of challenges creatively for everybody, including for us,” Iger said last week during Disney’s earnings conference call. “I’ve always felt that quantity can be actually a negative when it comes to quality, and I think that’s exactly what happened, we lost some focus.”
Iger followed his comments with a new mandate: Disney will be making fewer films. It’s a similar strategy to one Iger took when he first became Disney CEO in 2005. At the time, Disney’s animation and live-action studio divisions had struggled with a string of failed movies, including including “The Alamo,” and “Home on the Range” and “Pooh’s Heffalump Movie.”
Iger’s solution then was to cut 650 studio jobs and slash its annual movie production output in half, releasing only about a dozen films each year. He also acquired Pixar, giving Disney an immediate infusion of quality movies and a brand of storytelling that rubbed off on Disney’s traditional animation studio.
Iger appears to be re-running the playbook for 2024. After flooding Disney+ with movies and other new content for several years, Iger is strategically cutting back to accelerate free cash flow generation and profitability. Disney eliminated animation jobs in June — the first significant cuts in about a decade — as part of a larger round of job reductions.
DIS shares dipped 11 cents to $94.04.