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Bob Chapek has effectively run Bob Iger’s playbook during the past three years as CEO, putting streaming ahead of all else at the company.
For a while, this strategy worked, but investors have turned on it this year.
Iger may need to make bold moves about what to do with low-growth or no-growth assets, such as broadcast network ABC and linear cable networks such as ESPN.

Bob Iger, chairman and chief executive officer of The Walt Disney Company, pauses while speaking during an Economic Club of New York event in Midtown Manhattan on October 24, 2019 in New York City.
Drew Angerer | Getty Images

For nearly three years, Bob Chapek had a plan at Disney: Bob Iger’s plan.
“We are all-in [on streaming],” Iger said in April 2019, when he unveiled Disney+, the company’s flagship streaming service, which now has more than 164 million subscribers worldwide. Ten months later, Iger announced he’d step down as CEO, effective immediately.

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After he took over as chief executive, Chapek shifted Disney’s corporate structure to better align with a streaming-first world. Iger didn’t agree with the way he did it, but the general idea of building up Disney+ by spending billions on new content was in lockstep with Iger’s strategy. For a while, that strategy worked. Disney shares surged during the pandemic even as theme parks closed and movies were kept out of theaters. Investors cheered money-losing streaming services as long as they showed hypergrowth.
But as interest rates rose and Netflix customer growth plateaued earlier this year, the music stopped. Disney+ added 12.1 million subscribers this month and shares tanked. Much of this change in narrative was actually of Disney’s own doing, as Chapek (and other media executives) pushed getting to profitability over subscriber growth. Part of that shift was Disney’s realization that it likely wasn’t going to hit its target of 230 million to 260 million Disney+ subscribers by 2024. Chapek lowered that bar in August. Disney shares have fallen nearly 40% year to date.
Of course, while Iger said Disney was all-in on streaming, the reality was it wasn’t, and it still isn’t. Disney has held on to ESPN as the linchpin of the cable bundle. Today, just as in 2019, ESPN’s premier sporting events (its main “Monday Night Football” broadcast, for instance), can only be seen on cable.

Time for a new plan

Now, the Disney board has turned to Iger to come up with a new plan — or at least to choose a new leader who has one — over at least the next two years. Reorganizing the company to put “more decision-making back in the hands of our creative teams,” as Iger noted in his memo to employees yesterday, is an easy, and necessary, first move. But it’s more of a process change than a strategic one.
Iger’s biggest challenge will be choosing which Disney assets should be sold or spun off in the coming years, said Rich Greenfield, an analyst at LightShed partners. This wouldn’t be easy for any CEO, but it especially won’t be easy for Iger, who built the modern Disney with purpose. He orchestrated deals to buy Pixar, Marvel, Lucasfilm and much of 21st Century Fox.

Iger has had many chances in the past to shed cable networks, including ESPN, or broadcast channel ABC and its owned and operated affiliates, or Hulu. He never did in the past, but Greenfield said he thinks he’ll have to now.
“Bob Iger should sit down this weekend and make a list of the assets he wants Disney to keep and the ones he wants to get rid of,” Greenfield said. “What does Disney look like over the next five years? What are the assets we need to have? That needs to come first, and every decision after that follows the answer.”
Greenfield recommended either spinning off ESPN or dramatically cutting costs, including passing on renewing NBA broadcast rights, which will be renegotiated in 2023. He also said he’d try to sell Hulu to Comcast rather than paying Comcast $9 billion or more for the remaining 33% stake in the streamer.
It’s also possible Iger could once again punt these decisions to a successor. If he decides his role is purely a transition CEO, he could focus on finding the next leader of Disney and allow that person to make the big calls in the next two years.
But that’s never been Iger’s style. He delayed retirement three times in the past to keep the job. Now he’s back again.
Iger could have ridden off into the sunset, and he chose to come back — even after saying publicly “you can’t go home again.”
That’s probably a sign he has ideas about how to move Disney forward.
“The old plan can’t be the new plan,” Greenfield said. “That plan wasn’t working. Iger is going to have to make some hard decisions.”
WATCH: Investor Stephanie Link’s bullish case for Disney

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An Envoy Air flight returned to Chicago shortly after takeoff on Saturday night after a pilot was incapacitated and later died, the carrier said Tuesday.
The Columbus, Ohio-bound flight returned to Chicago about 27 minutes after departure, according to FlightRadar24.
Envoy was flying for parent airline American.

An American Eagle Embraer 175 aircraft is seen on the tarmac through a plane window at LAX in Los Angeles, California, U.S., January 10, 2018.
Lucy Nicholson | Reuters

An Envoy Air flight returned to Chicago shortly after takeoff on Saturday night after a pilot was incapacitated and later died, the carrier said Tuesday.
“Despite heroic efforts by those on board and first responders on the ground, our colleague passed away at the hospital,” Envoy Air, a regional carrier owned by American Airlines, said in a statement. “We’re deeply saddened and are doing all we can to support his family and our colleagues at this time.”

Capt. Ric Wilson, vice president of Envoy’s flight operations, said in a note to staff that the pilot was a captain in training.
Envoy did not comment on the cause of the medical emergency. The Air Line Pilots Association, the union which represents Envoy’s pilots, didn’t comment.
Envoy Air Flight 3556, an Embraer E175, flying for parent company American Airlines’ American Eagle returned to Chicago O’Hare International Airport at 7:57 p.m. local time, 37 minutes after departing for Columbus, Ohio, according to FlightRadar24.
An audio recording of messages to air traffic controllers indicates “captain is incapacitated,” according to ATCLive, which has an archive on its website. “We’re going to need paramedics,” said the person on the recording, who seemed to be another pilot on the flight.
 Commercial jetliners are crewed by a minimum of two pilots.
The Federal Aviation Administration said it is investigating and a spokeswoman said that such incidents are rare.

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Digital World Acquisition Corp. aims to take the parent company of Donald Trump’s Truth Social public.
DWAC, a so-called blank check company, held a shareholder meeting Tuesday after numerous delays.
The company has secured the necessary 65% shareholder support to extend the Trump Media merger deadline to September 2023.

This illustration photo shows Donald Trump’s new social media app Truth Social’s logo on a smartphone in Los Angeles, February 21, 2022.
Chris Delmas | AFP | Getty Images

The blank check company that plans to take Trump Media and Technology Group and its Truth Social platform public said Tuesday that shareholders voted to delay a deadline for its merger with the former president’s firm by several months.
Shares of Digital World Acquisition Corp. closed more than 5% higher following a brief shareholder meeting announcing the delay. DWAC faced liquidation next month if it couldn’t get a deadline extension, although the merger faces additional legal and financial obstacles. The Securities and Exchange Commission is probing the Trump Media-DWAC deal, as are federal criminal investigators.

The company, which hasn’t generated any revenue and already has $1 billion in financing already at risk, had delayed the meeting multiple times over recent months as it worked to garner support from shareholders. DWAC needed 65% of its shareholders to approve an extension of the deadline to merge with Trump Media until September 2023. In a securities filing Monday, DWAC said there was “substantial doubt” about its ability to continue as a “going concern.”
DWAC has previously failed to get the necessary votes from its large swath of retail investors. The meeting was adjourned numerous times. DWAC CEO Patrick Orlando initiated a built-in extension with a $2.8 million contribution from his company Arc Global Investments II. 
“It’s a really arduous process when you have as many stockholders as we did,” Orlando said during an interview with IPO Edge on Tuesday immediately prior to the shareholder meeting.
Orlando has been working to drum up votes on Trump Media’s Truth Social platform, and even urged Trump Media CEO Devin Nunes and its chairman, former President Donald Trump, to help publicize the effort.
The stakes of the vote were particularly high for some of the former president’s supporters, who shared on Truth Social and Reddit that they’ve invested thousands of dollars in DWAC in a nod of support for the platform. 

If a merger were to take place, it would give hundreds of millions of dollars in funding to Trump Media. It has already faced a series of legal and financial obstacles. The deal has been the subject of a criminal probe and its delay has resulted in the loss of over $100 million in investment. 
The former president previously said he could take the company private. Internal documents have shown that Trump Media also considered mergers and partnerships with other right-wing-friendly platforms, including Rumble and Parler. 
Over the weekend, Elon Musk, the new owner of Twitter, reinstated Trump on the social media platform. Twitter banned Trump in the wake of the Jan. 6, 2021, insurrection at the U.S. Capitol, where hundreds of his supporters rioted and disrupted lawmakers who were formally counting Electoral College votes. The former president has yet to tweet since his reinstatement.
“I would expect Truth [Social] to be the main platform for the president’s tweets, or, his truths,” Orlando said during the fireside chat Tuesday. “At Digital World, we don’t actually control anything to do with Truth and its users at this point. But we’re watching it, and we really like what we see with user engagement.”
The special purpose acquisition vehicle has also been dealing with the fallout from a Trump Media executive’s whistleblower complaint to federal regulators. William Wilkerson, a senior vice president at Trump Media, had filed a whistleblower complaint alleging securities violations in August. Wilkerson has described himself as one of the company’s founders and said he no longer believes in its viability. 
In September, the company said it lost $138.5 million of the $1 billion in financing from private investors in public equity, also known as PIPE, to fund the merger. That same month, DWAC changed its mailing address to a UPS Store in Miami. 
In recent days, DWAC lost one of its board members when Justin Shaner, CEO of Shaner Properties in South Florida, resigned, according to a securities filing.
–CNBC’s Jack Stebbins contributed to this article.

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The Supreme Court agreed Monday to hear a dispute between Jack Daniel’s and a dog toy company that sells “Bad Spaniels” whiskey bottles.
The toy closely resembles Jack Daniel’s signature Old No. 7 Black Label Tennessee Whiskey bottle, which the liquor brand argues violates federal trademark law.

Jack Daniel’s, Tennessee whisky.
Newscast | Universal Images Group | Getty Images

The Supreme Court has agreed to take up a trademark case centered around a squeaky dog toy that’s “43% Poo by Vol.” and “100% smelly.”
The court on Monday agreed to hear the trademark dispute brought by whiskey maker Jack Daniel’s against VIP Products, an Arizona-based company that sells products mimicking liquor, beer, wine and soda bottles.

The toy in question, dubbed the Bad Spaniels Silly Squeaker, closely resembles Jack Daniel’s signature Old No. 7 Black Label Tennessee Whiskey bottle. It features a cartoon spaniel on its front and references to Jack Daniel’s Old No. 7, such as the label “Old No. 2 on Your Tennessee Carpet.”
The toy retails online for about $17 and notes on the packaging in small font: “This product is not affiliated with Jack Daniel Distillery,” according to the Associated Press.
Jack Daniel’s is arguing VIP Products is in violation of federal trademark law and could be confusing shoppers, while VIP Products argues the toy is an “expressive work” under First Amendment protections.
In a 2020 ruling, the U.S. Court of Appeals for the 9th Circuit sided with VIP Products, prompting Jack Daniel’s to seek further relief from the Supreme Court. The court will likely hear arguments in the Jack Daniel’s case early next year.
VIP Products also sells parodies of other popular alcoholic bottles including including “Stella Arpaw,” which mimics designs from beermaker Stella Artois, and “HeineSniff’n,” which resembles Heineken. 

In 2008, VIP Products lost a similar case brought by Budweiser-maker Anheuser-Busch, who sued the company over a toy labeled “ButtWiper.”
VIP declined to comment on Tuesday due to pending litigation. Representatives for Jack Daniel’s didn’t immediately return request for comment.

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U.K. GDP has contracted by 0.4% between the fourth quarter of 2019 and the third quarter of 2022, versus 3.7% growth in the OECD area.
It is also the only G-7 economy to have shrunk in that time.
“We think this is happening mostly because of investment and because of consumption,” Alvaro Pereira, OECD chief economist, told CNBC.

LONDON — U.K. growth has lagged the world’s biggest economies since the Covid-19 pandemic and is substantially below the OECD average, according to a new report from the influential Paris-based group.
U.K. gross domestic product has contracted by 0.4% between the fourth quarter of 2019 and the third quarter of 2022, versus cumulative 3.7% growth in the 38-member Organisation for Economic Co-operation and Development.

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In the G-7 nations — which includes Canada, France, Germany, Italy, Japan, the U.S. and U.K. — GDP has grown by a cumulative 2.5%, with only the U.K. recording a decline.
“We think this is happening mostly because of investment and because of consumption,” Alvaro Pereira, the OECD’s chief economist, told CNBC’s Joumanna Bercetche on Tuesday.
“Knowing the U.K. faces a difficult fiscal situation, that’s why we welcome what the government has done in the latest statement,” he said.
Last week, Finance Minister Jeremy Hunt announced around £30 billion in spending cuts and £25 billion in tax hikes for workers and businesses in what he said was a bid to rebuild public finances, limit 41-year-high inflation and restore economic credibility after the market-rocking September budget.
“We think that it is very important to maintain fiscal prudence at the same time that you’re able to boost or try to introduce some kinds of reforms to address some of the issues that have been plaguing the United Kingdom for a while, which is very low productivity,” Pereira continued.

“I think it’s time to focus on that as well as monetary and fiscal policy.”
Pereira added that the OECD’s forecast for the U.K. economy’s magnitude of growth between 2022 and 2024 was similar to the independent Office for Budget Responsibility, but it expected a shallower 0.4% recession next year followed but 0.2% growth the year after, while the U.K.’s OBR forecasts a deeper recession and a stronger rebound.
Former Bank of England policymaker Michael Saunders this week told CNBC Hunt’s plan had a “massive” hole where an economic growth strategy should be.

‘Light at the end of the tunnel’

Tuesday also saw the release of the OECD’s global Economic Outlook report.
This cautioned that the global economy is set to slow in the year ahead due to the energy market shock caused by the Russian invasion of Ukraine and amid sky-high inflation, low consumer confidence and global risks.
However, it believes the world will avoid a recession, with 3.1% growth in 2022, 2.2% growth in 2023 and 2.7% growth in 2024.
OECD Secretary-General Mathias Cormann said in broadcast remarks the “world is facing substantial headwinds and substantial risks over the horizon” and “countries also need to take bold steps to address some of the longer-term challenges to lay the foundation for a stronger and more resilient economy.”
This included structural reforms such as increasing childcare support and flexible working options to encourage more women into the workplace, creating incentives to boost investment in low-emissions technology, and keeping international borders open to trade to alleviate supply-side inflationary pressures.
Pereira told CNBC: “We are facing a very challenging environment. I think one of the most dramatic pictures we have in our outlook is exactly how much countries are spending in terms of energy as a percentage of GDP, and you can see that right now for OECD countries it’s close to 18% … which is as high as we’ve seen in the oil crisis in the 70s and 80s.”

“We are facing a very large energy shock right now which is lowering growth, at the same time that it’s fueling inflation.”
The primary downside risks were within energy markets, particularly next year in Europe and Asia if there are two cold winters and retail prices follow wholesale prices higher, he said. The OECD is also concerned about financial market volatility for low-income countries and emerging markets that have high debt burdens amid rising rates.
However, he reiterated the OECD did not forecast an annual recession, even in major economies such as the U.S. and the euro zone.
He also said central bank action on monetary policy would begin to take effect to tame inflation, and that the latest U.S. inflation print was “fairly positive.”
“We expect that not only the U.S. but other parts of the world, the decisiveness of monetary policy will start to have more and more of an impact. Our central forecast sees inflation peaking in many countries in the mid half of next year or late this year, but mostly next year,” Pereira said.
“Particularly in 2024 we start having inflation rates much closer to target, so there is some light at the end of the tunnel, but we need not to let go of monetary and fiscal tightening working hand in hand.”

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Investor home purchases dropped just over 30% in the third quarter of this year compared with the same period last year, according to Redfin.
The drop in investor sales outpaced the drop in overall home purchases, which were down roughly 27% in the third quarter.
Home prices are still higher compared with a year ago, but the annual gains are shrinking at an unprecedented pace.

Housing under construction in Atlanta, Georgia, on Sunday, Nov. 13, 2022.
Elijah Nouvelage | Bloomberg | Getty Images

Home sales have dropped for nine straight months, driven by surging mortgage rates, and now investors are pulling back even more than traditional homebuyers.
Investor home purchases dropped just over 30% in the third quarter of this year compared with the same period last year, according to real estate brokerage Redfin. That’s the biggest drop in investor sales since the Great Recession over a decade ago, with the exception of a very brief stall in the first two months of the Covid-19 pandemic in 2020.

The drop in investor sales outpaced the drop in overall home purchases, which were down roughly 27% in the third quarter. The investor share in the overall market also fell to 17.5% of all sales from 18.2% a year ago. The share is still, however, slightly higher than the 15% share seen before the pandemic.
“It’s unlikely that investors will return to the market in a big way anytime soon. Home prices would need to fall significantly for that to happen,” said Sheharyar Bokhari, senior economist at Redfin. “This means that regular buyers who are still in the market are no longer facing fierce competition from hordes of cash-rich investors like they were last year.”
Non-investor homebuyers are facing much higher mortgage rates and a shortage of affordable homes for sale. Investors tend to use cash more often than traditional buyers, so they are not quite as influenced by mortgage rates. They are, however, influenced by home prices, which are weakening.

Home prices are still higher compared with a year ago, but the annual gains are shrinking at an unprecedented pace. The S&P CoreLogic Case-Shiller national home price index was up 13% in August, which is the most recent reading, but that was down from a 15.6% annual gain in July.
“The -2.6% difference between those two monthly rates of change is the largest deceleration in the history of the index (with July’s deceleration now ranking as the second largest),” Craig Lazzara, managing director at S&P DJI, said in a release. “Further, price gains decelerated in every one of our 20 cities. These data show clearly that the growth rate of housing prices peaked in the spring of 2022 and has been declining ever since.”

Investors who are still in the market, however, are still paying higher prices than last year. The typical home purchased by an investor in the third quarter cost $451,975, up 6.4% from a year ago, but down 4.3% from the second quarter.  
Regionally, markets seeing the biggest decline in investor activity were Phoenix, Arizona, Portland, Oregon, Sacramento, California, and Atlanta, Georgia. All of those were some of the hottest pandemic-driven markets that are now seeing the steepest slump in overall sales. Miami also saw an outsized drop in investors, suggesting that even the massive drive to the Sun Belt is finally easing.

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Dr. Anthony Fauci will give what is likely his last public briefing on Covid-19 as White House chief medical advisor.
Fauci announced earlier this year that he will step down in December. He has served as the public face of the United States’ coronavirus pandemic response for more than two years.
The U.S. is facing a severe flu season, and respiratory syncytial virus, or RSV, is hospitalizing children at a much higher rate than in pre-pandemic seasons.

NIH National Institute of Allergy and Infectious Diseases Director Anthony Fauci addresses the daily press briefing at the White House in Washington, January 21, 2021.
Jonathan Ernst | Reuters

Dr. Anthony Fauci on Tuesday will give what is expected to be his last public briefing on the Covid-19 pandemic as the White House chief medical advisor.
Fauci announced earlier this year that he will step down in December after serving as the public face of the United States’ coronavirus pandemic response for more than two years.

He will give an update alongside Dr. Ashish Jha, head of the White House Covid task force. They are expected to encourage people to get their Covid boosters and flu shots as soon as possible.
Public health officials have repeatedly warned that the U.S. will likely face another wave of Covid this winter as people travel and gather for the holidays.

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The new boosters, which target the variant omicron BA.5, were quickly rolled out in an effort to head off a major surge. But only about 11% of those people eligible have received their shot so far.
The U.S. is already facing a severe flu season, with hospitalizations at a decade high.
And respiratory syncytial virus, or RSV, is hospitalizing children at a much higher rate than in pre-pandemic seasons.

Hospitals and emergency departments are increasingly taxed by people seeking treatment for respiratory illnesses.
Children’s hospitals last week called on the Biden administration to declare a public health emergency to provide more flexibility to address the surge of patients.

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Best Buy reported quarterly results that topped Wall Street’s expectations.
The retailer stuck to its holiday-quarter outlook as electronics demand held up.
Comparable sales fell by less than Best Buy’s own projections.

A customer watches as Best Buy employees load his new television into his car during the state’s sales tax free weekend, beginning on Saturday.
Erin Clark | Boston Globe | Getty Images

Best Buy on Tuesday surpassed Wall Street’s expectations for quarterly earnings, as inflation-dented demand for pricey consumer electronics came in better than feared.
The consumer electronics retailer, which had cut its forecast this summer, reiterated its outlook for the holiday quarter. It raised its full-year forecast to reflect the beat, saying it expects comparable sales to decline about 10%.

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JPMorgan says these two retailers are its favorite picks into the holiday season

22 hours ago

Shares of the company rose more than 9% in premarket trading Tuesday.
Here’s how the retailer did for the three-month period ended Oct. 29 compared with what Wall Street was anticipating, according to a survey of analysts by Refinitiv:

Earnings per share: $1.38 adjusted vs. $1.03 expected
Revenue: $10.59 billion vs. $10.31 billion expected

While Best Buy’s quarterly results were better than expected, demand is down from the heights of the pandemic, when consumers turned to its stores for home theaters, computer monitors, kitchen appliances and more while working, playing and cooking at home.
Net sales for the fiscal third quarter declined by about 11% from $11.91 billion year over year in the third quarter. Net income fell to $277 million, or $1.22 per share, from $499 million, or $2 per share, a year earlier.
CEO Corie Barry said holiday shopping patterns are also shifting to a more typical pre-pandemic pattern. In a news release, she said the retailer expects customers to spend more during Black Friday, Cyber Monday and the two weeks leading up to Christmas.

Best Buy is staring down a more uncertain sales environment this holiday season. Some inflation-pinched consumers are pulling back on discretionary items and spending more money on necessities and experiences. The company joined other retailers in slashing its outlook this summer. It said at the time that it expects same-store sales to drop by about 11% for the 12-month period ending in January.
A month after Best Buy warned of slower sales, it cut jobs across the country.
Yet, so far, the company has topped its own expectations.
Comparable sales fell by 10.4%, less of a decline than the 12.9% that analysts expected, according to FactSet. The key metric, also called same-store sales, tracks sales online and at stores open at least 14 months.
It was also less of a drop than the retailer anticipated. Best Buy had not given specific guidance for comparable sales in the third-quarter, but its Chief Financial Officer Matt Bilunas had cautioned it would drop more than the 12.1% decline in the second quarter. 
The company said it has resumed share buybacks, which it paused when it took down its forecast in July. Best Buy said it plans to spend about $1 billion on share buybacks this year.
Barry said the company is tightly controlling its inventory, which was down 14.7% year over year. The retailer anticipated a decline in demand and lapped a year-ago period when shipments arrived both early and late because of a supply chain challenges.
Inventory has been a closely watched metric in the retail industry, as many companies cope with a glut of unwanted goods and have had to mark down items, cancel orders or pack and store goods.
Shares of Best Buy are down about 30% so far this year, underperforming the S&P 500 Index. Shares closed on Monday at $70.83, down nearly 2%. The company’s market value is $15.95 billion.

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