What's going on at Disney?

In a stunning turn of events, Disney is swapping out one Bob for another. What's going on at the company that led to its CEO being ousted on a Sunday night and replaced by the very man who gave him the job? Here's everything to know:

Wait, Bob Iger is back at Disney?

Yes, in a Sunday evening bombshell, Disney announced CEO Bob Chapek has stepped down effective immediately and Bob Iger, who served as CEO from 2005 through 2020, is returning to his old job.

It was a jaw-dropping development for a number of reasons, including the fact that Iger had dismissed the possibility of returning to Disney after officially retiring at the end of 2021.

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But Iger is regarded as one of the most effective leaders in Disney's history, having overseen a number of blockbuster deals including the acquisition of Pixar, Marvel, and Lucasfilm. Upon Iger's return, Frozen star Josh Gad tweeted he's never "been so happy," welcoming back "the GOAT."

Disney said Iger has agreed to serve as CEO for two years, during which time he'll work with the board to develop "a successor to lead the company at the completion of his term."

Why was Bob Chapek's tenure so tumultuous?

Iger, though, already did choose a successor in 2020 — but it didn't quite work out as expected.

Bob Chapek had served as head of Disney's parks division until February 2020, when he was named CEO in a somewhat surprising pick. The last year of Iger's tenure was hugely successful for Disney, which released seven films that grossed over $1 billion worldwide. Chapek, on the other hand, took over just before one of the most challenging periods in the company's history, as Disney was soon forced to close its theme parks due to the COVID-19 pandemic.

But the issues hardly stopped there, as Chapek went on to face multiple controversies that led to frequent speculation he was on thin ice.

In March 2022, Chapek came under fire after initially declining to speak out against Florida's so-called "Don't Say Gay" bill, drawing backlash from LGBTQ+ employees and even some executives like Marvel's Victoria Alonso. After first defending his silence, Chapek said Disney opposes the bill and apologized for not being a "stronger ally" earlier, leading Florida Gov. Ron DeSantis (R) to retaliate. So in the end, Chapek managed to upset both sides of the debate. Iger, meanwhile, condemned the bill before Chapek.

The year prior, Chapek was criticized for his handling of a battle with actress Scarlett Johansson, who sued Disney over the streaming release of Black Widow. Disney issued a surprisingly scathing response that controversially revealed how much Johansson was paid for the film, which upset some in the industry. Joe and Anthony Russo, directors of Disney's Avengers: Endgame, called the response "disturbing to us as artists."

Another controversial move by Chapek was the abrupt firing in June 2022 of top television executive Peter Rice. Because Rice was seen as a possible contender for the CEO job, his ouster was viewed as "a preemptive strike against a formidable challenger," Variety notes.

Chapek's reorganization of Disney to prioritize streaming also ruffled feathers. Under his reorganization, Disney chair of media and entertainment distribution Kareem Daniel was given "unprecedented latitude to help decide how Disney would spend" its content budget, which controversially took "responsibility away from the entertainment division leaders," the Los Angeles Times explains. There was also criticism that this new structure was "byzantine and more convoluted than necessary, adding an extra managerial layer into the process of getting projects made," Variety reports.

Additionally, Chapek became unpopular among fans of Disney parks after raising ticket prices and introducing Disney Genie+, a paid service allowing guests to skip lines. This replaced the similar (but free) service FastPass. In August 2022, Chapek drew backlash after saying the parks' profits were "offset by an unfavorable attendance mix at Disneyland Resort," seemingly deeming annual passholders "unfavorable" for not spending enough money, Deadline notes.

In August 2022, investor Dan Loeb placed pressure on Chapek to spin off ESPN, though he later backed off.

Also in 2022, Chapek faced criticism over the decision to forgo a theatrical release for the acclaimed Pixar film Turning Red and release it directly to Disney+. When Pixar's next film Lightyear was a major box office disappointment, some analysts argued this was because Disney trained audiences not to see Pixar films in theaters.

What was the last straw for Chapek?

Despite all this, the Disney board extended Chapek's contract in June 2022.

But cut to five months later, and Disney's stock was in rough shape, reaching a 52-week low, according to The Hollywood Reporter. In a disappointing earnings report that left investors concerned, Disney disclosed it lost almost $1.5 billion in its direct-to-consumer division — more than double its losses in that quarter a year prior.

Making matters worse, when Chapek discussed these numbers, his upbeat demeanor "struck many as tone deaf," notably when he started to "implausibly talk about how great the response had been to Mickey's Not So Scary Halloween Party, a relatively inconsequential event at Disney World," The New York Times explains.

Chapek also announced he was assembling a "cost structure taskforce," which Puck reports "sounded alarm bells internally and created chaos," and he warned Disney will meet its goal of reaching streaming profitability by 2024 only if there isn't an economic downturn, The Wall Street Journal notes.

This all led CNBC's Jim Cramer to declare Disney "is a disaster" and call for Chapek to be fired.

"This was one of the most disappointing quarters I have come across of a major company," Cramer said, noting "streaming losses are getting worse." He also slammed the "delusional" way Chapek talked about the quarter as if it wasn't a major disappointment.

What did Iger think of Chapek's tenure?

After Iger officially departed Disney at the end of 2021, there were signs he wasn't happy with Chapek's leadership.

In March 2022, CNBC reported that Chapek's battle with Johansson "embarrassed" Iger and that Iger had qualms with Chapek's reorganization of Disney. Iger "felt stripping division heads of their budget control wasn't the right structure for Disney because the company was too diverse and complex," the report said.

Just days before Iger's return in November 2022, Puck reported that while Iger tries not to criticize Chapek publicly, "Privately, lots of folks ask what he thinks, and when he answers, it's not favorable" — and the "recent stock dive has only exacerbated those feelings."

On his very first day back as CEO, Iger already moved to undo Chapek's reorganization, announcing he has tasked multiple executives with the "design of a new structure that puts more decision-making back in the hands of our creative teams and rationalizes costs." To that end, Kareem Daniel, Disney chair of media and entertainment distribution, left the company.

What are analysts saying about Iger's return?

Ultimately, Chapek's "biggest mistake was icing out Iger rather than making him a trusted advisor," CNBC's Alex Sherman argued, adding that "to push away Iger rather than embrace his help was always risky" and may have contributed to his downfall.

As far as why Iger would want to return, Puck's Matthew Belloni wrote that one reason is that it gives him the opportunity to once again select a successor — and if he gets it right this time, "he will have patched over the one aspect of his leadership resume that still feels blemished."

Speaking with CNBC, Semafor editor-in-chief Ben Smith also noted some analysts have speculated Iger may have "one amazing deal left in him — and just perhaps that's Netflix."