Disney Under Fire as Activist Investors Demand Streaming Overhaul

By Kylie, Contributor
March 21, 2025 – 10:20 AM PDT, Burbank, CA

Disney’s in the hot seat today after activist investor Nelson Peltz unleashed a scathing critique of its streaming strategy, demanding a “complete overhaul” at the 2025 Tech Summit. Peltz’s Trian Fund, holding a $3 billion stake, blasted CEO Bob Iger in a 10-page letter for Disney+’s flat 150 million subscribers and $2 billion in losses last year. The salvo’s reignited a proxy war, with stock dipping 2% as Wall Street braces for a showdown.

Peltz’s beef is simple: Disney’s streaming empire—Disney+, Hulu, ESPN+—is bleeding cash while Netflix and Amazon pull ahead. He’s pushing a three-pronged fix: bundle the services into one $15/month package, double down on ad-supported tiers, and spin off ESPN to unlock value. Trian argues this could flip Disney’s direct-to-consumer arm profitable by 2027, a goal Iger’s pegged for 2026 but keeps missing. The letter calls Iger’s approach “stagnant,” a jab at his post-2022 return.

The timing’s brutal. Disney’s summit pitch—a new AI-driven content recommender—landed flat, overshadowed by Peltz’s attack. Subscriber growth’s stalled since 2023, with Marvel and Star Wars fatigue blamed—last quarter’s Mufasa prequel barely broke even. Ad revenue’s up 10%, but it’s not enough to offset $500 million in content cuts. Rivals are eating Disney’s lunch: Netflix added 20 million users in 2024 alone, leaning on cheaper originals.

Iger fired back in a CNBC interview, defending his “long game” of quality over quantity. He touted a $1 billion animation pipeline and ESPN’s NFL deal through 2030, arguing patience will pay off. But Peltz’s camp isn’t buying it—Disney’s stock’s lagged the S&P 500 by 15% since Iger’s comeback, and Trian’s rallying other shareholders like BlackRock for an April board fight. Analysts say Peltz has a shot at two seats, enough to force change.

Disney’s woes aren’t just numbers—culture’s a factor. Staff morale’s tanked after layoffs and a Florida tax feud, while creative output’s slowed; only three theatrical releases are slated for 2026. Peltz wants a leaner machine, suggesting a sale of underperforming assets like ABC to fund streaming. Iger’s resisted divestitures, banking on synergy across Disney’s empire—a vision investors are souring on.

The broader streaming war adds pressure. Cable’s dying—U.S. cord-cutters hit 60 million last year—and Disney’s late to pivot fully digital. Peltz’s plan apes Netflix’s ad-tier success (40% of its base) but risks alienating premium subscribers. Disney’s testing a $9.99 bundle in Europe, with U.S. rollout eyed for Q3, though Iger’s cagey on committing. Wall Street’s split—some see Peltz as a catalyst, others a wrecking ball.

For now, Disney’s at a crossroads. Iger’s got till the April meeting to prove his strategy’s not dead weight, but Peltz’s breathing down his neck with real ammo. The stock’s wobble reflects the stakes: a legacy titan fighting to stay relevant in a streaming world it once aimed to rule. The next move’s Iger’s—but Peltz might force it.