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Disney Appoints Former PepsiCo Finance Chief Hugh Johnston as New CFO

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Disney Appoints Hugh Johnston, Former PepsiCo CFO, as New CFO

Disney announced on Monday that Hugh Johnston, the longtime chief financial officer of PepsiCo, will be joining the company as its new CFO. This move comes as Disney faces challenges with a declining share price and losses in its streaming business. Johnston brings with him 34 years of experience at PepsiCo, having held various positions before becoming CFO in 2010.

A Strategic Addition to Disney's Leadership

Starting on December 4th, Johnston will report directly to CEO Bob Iger. In a statement, Johnston expressed his excitement about joining Disney, recognizing it as a storied company with beloved brands and a strong financial foundation. He emphasized Disney's resilience and rarity in withstanding the test of time.

A Change in CFO Amidst Restructuring

Johnston's appointment comes after the resignation of Disney's previous CFO, Christine McCarthy, earlier this year. McCarthy's departure occurred during a period of massive restructuring under CEO Bob Iger's second tenure, which began approximately a year ago. The company underwent several rounds of layoffs, resulting in 7,000 job cuts.

Pressure from Activist Investor and Streaming Struggles

Disney is currently facing additional pressure from activist investor Nelson Peltz. The company has been grappling with losses in its streaming business and a 2% decline in its stock value this year. Peltz's firm, Trian Fund Management, has increased its stake in Disney to approximately 30 million shares. It has been reported that the firm intends to advocate for multiple seats on the board, including one for Peltz himself.

Upcoming Earnings Report and Future Outlook

Disney is set to report its quarterly earnings after the closing bell on Wednesday. The company's financial performance will be closely watched, particularly in light of the challenges it faces in its streaming business and the activist investor pressure. The appointment of Hugh Johnston as the new CFO brings a fresh perspective and expertise to help navigate these challenges. Disclosure: It is important to note that Hugh Johnston is a member of CNBC's CFO Council.

Implications of Disney's New CFO Appointment for New Businesses

Disney's recent appointment of Hugh Johnston, the former CFO of PepsiCo, as its new CFO, provides a valuable lesson for new businesses. Amidst declining share prices and streaming losses, Disney's strategic move to bring in Johnston, a seasoned finance executive, underscores the importance of experienced leadership in navigating business challenges.

Experienced Leadership as a Strategic Advantage

Johnston's appointment is a testament to the value of experienced leadership in steering a company through turbulent times. For new businesses, this highlights the importance of having seasoned executives who can provide strategic direction and financial stewardship.

Leadership Changes Amidst Restructuring

The change in Disney's CFO position amidst a period of massive restructuring provides a key insight for new businesses. It underscores the critical role of financial leadership in guiding a company through periods of change and uncertainty.

Addressing Investor Pressure and Business Challenges

Disney's ongoing struggle with activist investor pressure and streaming losses offers a cautionary tale for new businesses. It underscores the need for businesses to maintain a strong financial foundation and to proactively address investor concerns.

Future Outlook and the Role of Financial Leadership

As Disney prepares to report its quarterly earnings, all eyes will be on how the company navigates its current challenges. For new businesses, this serves as a reminder of the critical role of financial leadership in shaping a company's future outlook and addressing business challenges. The appointment of a new CFO can bring fresh perspectives and strategies to help a business navigate through turbulent times.
Story First Published at: https://www.cnbc.com/2023/11/06/disney-hugh-johnston-cfo.html
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