Disney "Will Be Purchased During the Next Three Years," One Analyst Predicts

The Walt Disney Company might look VERY different in a few years.

We’ve already seen a massive restructuring take place, job cuts be implemented, cost-cutting measures take effect, and more. But could Disney actually be SOLD to another company in the next few years? It’s a rumor that’s been around for a while and now we’re unpacking what you need to know.

The Rumors

Rumors have existed for quite some time that Disney could be sold to Apple or another tech company. A 2022 article from The New York Times points out that there had been speculations of a Disney and Netflix merger (at least with the streaming side of the business) years ago and rumors of a deal between Disney and Apple too.

The rumors got so large that Iger ultimately addressed them in 2022 when he returned as CEO for his second term. During a Town Hall meeting with Cast Members, Iger reassured them that a merger between Disney and Apple was “nothing more than speculation.” But that hasn’t stopped the rumors from continuing.

©CNN

What’s led to all this speculation, particularly as it relates to Apple? Well, a few things. For starters, there’s the fact that during Iger’s first tenure, he made a number of big acquisitions — like Pixar, Lucasfilm, Marvel, and Fox. That could lend itself to the idea that Disney would be the one acquiring another company — but with Disney’s stock struggling at times, continued battles to make streaming profitable, and other obstacles, it could be quite the reverse this time around.

Perhaps Iger has seen the value companies like Pixar and Marvel have obtained in being acquired by Disney and feels it is time to give Disney the same chance — the ability to gain a lot of value by being sold to another company.

Another thing that has fueled the Apple sale rumors is the relationship that Iger had with the late Steve Jobs. It was Iger who was able to reach a deal with Jobs about the acquisition of Pixar, but their relationship goes beyond just business. In a Vanity Fair article (adapted from Iger’s book The Ride of A Lifetime: Lessons Learned from 15 Years as CEO of the Walt Disney Company) he shares, “When I think back on my time as CEO—at the things I’m most grateful for and surprised by—my relationship with Steve is one of them. He could criticize me, and I could disagree, and neither of us took it too personally.”

He goes on to detail just how special their relationship was. But Iger says one particularly interesting thing about Jobs, Apple, and a potential Disney merger.

Back in 2019, Iger actually said “I believe that if Steve were still alive, we would have combined our companies, or at least discussed the possibility very seriously.” So it seems Iger is partially the source of these merger rumors.

Not Everyone Is a Supporter

Now, to be clear, it’s not as though all analysts or executives believe firmly in this rumor. Some have scoffed at it. According to The Hollywood Reporter, there are some executives who say Apple doesn’t want to buy a studio or point out that a big deal like that would never pass federal review.

One attorney and professor (Anthony Sabino at St. John’s University) has pointed to factors like Iger’s contract extension at Disney (he’ll now serve as CEO through 2026) as evidence that the Board does not want him to simply sell off the Company but instead wants Iger to guide the Company into its future.

There Could Be a Unique Way to Do Things

What if Disney as it exists presently wasn’t the company ultimately sold to Apple though? Could that tackle some of the federal regulation concerns and perhaps convince folks that it would be more desirable for Apple? It’s possible.

The Hollywood Reporter notes that one observer said Apple may not buy Disney as it exists presently, but “if you see Bob start to divest things…that feels like he’s prepping for a sale. And there’s clearly no buyer like Apple.”

Not long after that observation was made, Iger made some statements in a CNBC interview that sent shockwaves through the media industry. In July of 2023, Iger spoke with David Faber on CNBC at which point Faber asked whether Iger would be potentially looking to sell things like ABC, cable networks, FX, Nat Geo, and other parts of Disney’s linear TV business. Iger said that Disney would be “expansive,” “open minded,” and “objective” when looking at those businesses.

He said that these linear networks “may not be core to Disney.” Iger also argued that the business model for those businesses is “definitely broken. And we have to call it like it is.” In other words, some viewed this as Iger putting up a “for sale” sign on Disney’s linear networks.

The statements caused such a stir that, according to CNN Business, Iger ultimately met with leaders of the Company’s television business to try and calm the “high anxiety” some leaders within the linear networks were feeling (according to some sources). One source said that during that meeting, Iger told individuals present that the content created by Disney’s television production teams is “incredibly valuable to our business.” He also reportedly talked about the importance of ABC News.

But that hasn’t stopped Iger from looking closely at those linear networks and the best next steps. He reportedly has enlisted the help of 2 former Disney executives to advise him on the future of Disney’s TV businesses.

©ABC News

The Hollywood Reporter points out that a more slimmed-down Disney company (one that perhaps no longer owns those linear networks anymore) could be a more “tempting acquisition target.” And while Apple might not want to buy just any studio, buying one with the wealth of intellectual property that Disney has is a different thing altogether.

And Disney has continued an active relationship with Apple. For example, back in June of 2023, Iger revealed a big partnership between the two companies for the Apple Vision Pro (Apple’s new virtual reality headset).

And it’s not like Disney is the only company that could see major changes in the media industry. For quite some time, certain executives have anticipated a future where there will be fewer and fewer platforms and companies will get acquired.

Again, whether this would pass federal reviews on mergers and lessening competition is not clear, but if Iger views things similarly, he might feel that now is the time to act and essentially face the “inevitable.”

There’s also the idea that Iger is facing a number of huge challenges at Disney already, between the search for a new CEO, streaming losses, some losses at certain Disney parks, a declining linear network business, legal battles in Florida, and more. Perhaps selling Disney to another company that would inherit those issues and potentially manage them differently is what Iger views as the best option.

One analyst — Laura Martin from Needham & Co. has predicted that Disney “will be purchased during the next three years.” Martin shared, “If they don’t sell, Disney will be competing against those [tech] companies in an industry with deteriorating economics (because they never need to make money from content), we believe.”

A Sale Wouldn’t Be All That Easy

Even if Iger does want to sell Disney to Apple (or another company) it’s not as though that would be simple. Aside from the actual transitions required, any merger or deal of that kind would face a lot of scrutiny from the federal government.

The size and power of the combined companies would be a big issue. But The Hollywood Reporter points out that some recent cases could provide some guidance to Disney, should they choose to go in that direction.

Iger’s Most Recent Response to the Rumors

So what has Iger said lately? Well, it seems the rumors of Disney being sold to other companies or even breaking Disney up into smaller pieces (which, ultimately, could assist in a sale) are still top of mind.

During the earnings call for the third quarter of fiscal year 2023, one analyst (Michael Nathanson from MoffettNathanson) asked whether it would make sense to create 2 Disney companies — one focused on parks, Disney+, and studio IP, and one that captures most other things.

Iger said, however, that he wouldn’t “comment on the future structure of the company or the asset makeup of the company.” But he did note that they’re “looking at strategic options both for ESPN and for the Linear Networks” and “addressing all the challenges that those businesses are facing.”

Another analyst asked the question a bit more directly. Michael Morris of Guggenheim Partners asked Iger whether he could see a “plausible scenario” where Disney would be sold.

Iger responded by saying he was “not going to speculate about the potential for Disney to be acquired by any company, whether a technology company or not.” But he interestingly noted that “anyone who want[s] to speculate about these things would have to immediately consider the global regulatory environment.”

He concluded simply by saying “I’ll say no more than that. It’s just — it’s not something that we obsess about.” Hmmm…it might not be something Disney “obsesses” about, but is it something they at least think about? It doesn’t seem like Iger has shut down that possibility.

What’s Next?

In terms of the next steps, it seems like shareholders, analysts, and others will be left to do a whole lot of…well…waiting. We’ll have to wait and see what Iger ultimately does with Disney’s linear TV networks and whether Disney begins to sell them off in a way that might create a “slimmer” and more acquirable Disney company.

It’ll also be interesting to see how the streaming side of Disney’s business changes and whether that impacts Iger’s game plans moving forward. Who Disney chooses as its next CEO may also give a clue as to the future of the Company and what direction it could go in.

©Disney

Iger has a BIG legacy to “protect” (so to speak) at Disney with the number of acquisitions and big changes he implemented. Perhaps a sale of the Disney Company is just the thing he needs to really solidify his legacy at the Company and leave a lasting impact.

We’ll keep an eye out for more news on this and let you know what we find. Stay tuned for all the latest updates.