Benzinga - In just a few short months after Walt Disney Co (NYSE: DIS) CEO Bob Iger returned to take the helm, the Mouse has found its footing and looks to be following a crumb trail that leads to more cheddar for shareholders.
Following the company's quarterly results, Iger talked about what led him back to Disney in a Thursday morning interview on CNBC's "Squawk On The Street."
"I guess I had a sense of obligation, and I also wanted to help them not only transform the company during a pretty critical time, but I wanted to help them succeed at succession, which is quite important to me too," the 71-year-old Disney CEO said.
Iger's Return: Less than a year after Iger made his departure from Disney, he received a call on a Friday asking him to make his return. The following Monday he got right to work.
Since that time, Disney has cut costs, narrowed its focus and announced plans to embark on a "significant transformation," per the company's quarterly report.
Related Link: Disney Q1 Earnings Highlights: 7,000 Job Cuts Amid Reorganization, Theme Park Growth, Disney+ Subscribers And More
"We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders," Iger said.
He told CNBC the turnaround will be fully cemented in less than two years' time. He also plans to help identify the right successor to carry Disney into the future.
"I think we've already demonstrated in what has been just over two months since I came back, that you can make a lot of changes very quickly," Iger said.
The Disney+ Approach: A lot of people like to focus on Disney's foray into streaming. Many have criticized the company for offering such low prices on its streaming packages, but Iger backed up the company's decision with three solid reasons behind the lower price structure.
He explained that he knew the Street would measure the company based on subscriber growth in the early stages. "I was right about that, by the way," he added.
The Disney CEO also thought that accessibility was an important brand attribute for Disney. He didn't want to price people out of consuming the content they love.
And finally, Iger said he was very aware of increasing competition. He figured that offering Disney+ at lower prices would put pressure on competitors and give the company a competitive advantage. Furthermore, the company's content offerings hadn't been filled out on the intial rollout.
"The price was taken up by $3 from $7.99 to $10.99 just recently and we had a de minimis churn in subs, which says that now that we've fueled that pipeline with more original content ... there is pricing leverage," he said.
Iger admitted that Disney became intoxicated by its own subscriber growth early on, but now the company has shifted its focus to profitability and it expects its streaming business to be profitable by the end of 2024.
DIS Price Action: Disney has a 52-week high of $157.50 and a 52-week low of $84.07, according to Benzinga Pro.
The stock was down 1.49% % at $110.12 Thursday afternoon after being up more than 6% earlier in the day.
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