Nelson Peltz, founding partner and CEO of Trian Fund Management, speaks with CNBC’s Andrew Ross Sorkin on July 17, 2013 in New York.
Heidi Gutman | CNBC, NBCU Photo Bank, NBCUniversal via Getty Images
Aren’t you having fun, Nelson Peltz?
Disney Shares jumped 6% in aftermarket trading on Wednesday after company posted earnings and flooded the zone with new announcements intended not only to excite its employees and shareholders, but also to put activist investor Nelson Peltz in his place.
Peltz has launched a proxy fight against Disney, asking investors to nominate him and former Disney CFO Jay Rasulo to replace current board members Michael Froman and Maria Elena Lagomasino. Both Disney’s higher earnings and its slew of content and partnership announcements appeared to be a direct rebuttal to Peltz’s concerns about the company.
“The last thing we need right now is to be distracted by an activist or activists who have a different agenda and don’t understand our company,” Disney CEO Bob Iger told CNBC’s Julia Borstyn in an interview on Wednesday.
During his company’s first-quarter earnings conference call, he added, “we’ve turned the corner and entered a new era.”
Peltz, who first took a stake in Disney last year only to walk away and then renew his anti-brokerage threats, responded with a statement to CNBC that he won’t back down this time.
“It’s deja vu all over again,” Peltz’s firm Trian Fund Management he said in a statement. “We saw this movie last year and didn’t like the ending.”
It was hard to keep up with Disney’s announcements this quarter:
- ESPN has finally set a launch date for the direct-to-consumer service: August or fall of 2025.
- Disney is buying a $1.5 billion stake in Epic Games, the maker of Fortnite. It’s Disney’s “biggest foray into gaming ever,” Iger told Boorstin.
- Taylor Swift’s Eras Tour movie is coming to Disney+.
- Disney increased its dividend by 50% from its last dividend payment in January.
- Disney has announced that the ‘Moana’ sequel is coming to theaters in November, which will likely be the studio’s biggest box office hit of the year.
- Disney is on track to meet or exceed its targeted $7.5 billion in spending cuts by the end of fiscal 2024.
- The company said it expects Earnings for fiscal 2024 will grow at least 20% in 2023.
All of these announcements come a day after Disney made more news, revealing that it is starting a joint venture with Warner Bros. Discovery and Fox to offer ESPN in a new slim bundle of linear networks aimed at sports fans later this year. It will be the first time cord cutters and cord niggers will have access to ESPN outside of the traditional cable bundle.
It makes sense that the mountain of announcements came this quarter, given the pressure from activists Trian and Blackwells Capital. Iger has a vested interest in defeating critics of his performance and strategy.
Peltz has been vocal in slamming Iger’s leadership as the stock has tumbled over the past year, underperforming the S&P 500. Trian set up a website, restorethemagic.comwhich claims that Disney “has not delivered for shareholders.”
“I’m sorry the board didn’t welcome me,” Peltz said last month. “This company just doesn’t work properly.”
Iger said he hasn’t spoken to Peltz recently and doesn’t plan to. In a deposit last month, Disney said “In deciding not to recommend Mr. Peltz, the directors considered a number of factors, including that in a two-year search for a seat on Disney’s board, Mr. Peltz had presented virtually not a single strategic idea for Disney.”
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