Tensions between President Donald Trump and media companies may have lasting effects on The Walt Disney Company (NYSE:DIS), which announced Monday that it lifted the suspension of late-night host Jimmy Kimmel.
Here's what could be at stake for the future of Disney.
Kimmel Coming Back Tuesday
Disney suspended “Jimmy Kimmel Live” last Wednesday after it received criticism from regional networks, FCC Chairman Brendan Carr and Trump for comments Kimmel made about the death of Charlie Kirk.
Trump praised the suspension of Kimmel's show, and some experts believed his show would not return.
Disney announced Monday that Kimmel's show will be back on Tuesday on ABC.
"Last Wednesday, we made the decision to suspend production on the show to avoid further inflaming a tense situation at an emotional moment for our country," Disney said in a statement, as reported by NBC News. "It is a decision we made because we felt some of the comments were ill-timed and thus insensitive."
Disney said they have been in touch with Kimmel in recent days. "After those conversations, we reached the decision to return the show on Tuesday."
Disney did not respond to Benzinga's request for comment on the status of Kimmel's show on Monday.
It is unknown if all regional networks will immediately begin airing "Jimmy Kimmel Live" on Tuesday. Sinclair Broadcast Group (NASDAQ:SBGI) and Nexstar Media Group (NASDAQ:NXST) are among the regional television operators that denounced Kimmel's comments and threatened not to air the show.
Trump told reporters that bad ratings and a "lack of talent" led to Kimmel’s firing. Trump also called on Comcast to fire Jimmy Fallon. Previously, Paramount Skydance (NASDAQ:PSKY) announced that “The Late Show with Stephen Colbert” on CBS would end in 2026 after Colbert joked about a bribe between Trump and the media network.
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Disney’s Merger At Risk?
As Benzinga previously reported, Nexstar’s criticism of the comments and decision to stop airing Kimmel's show followed Carr’s suggestion that the comedian and Disney would face punishment.
"We can do this the easy way or the hard way," Carr said on a podcast.
Nexstar has a pending acquisition of Tegna (NYSE:TGNA), a deal that needs the approval of the FCC. Its decision to pull Kimmel's show may have been to win favor with Carr to get the deal through.
The previous pending merger of Paramount and Skydance faced struggles with the FCC and regulatory agencies until Paramount settled a lawsuit with Trump.
Disney also has a pending merger that needs FCC approval. The media giant's ESPN sports division signed a deal to swap a 10% stake to the NFL in exchange for the rights to media assets like NFL Network, NFL RedZone, NFL Fantasy Football and more.
The deal is estimated at around $2 billion and will likely face regulatory hurdles due to ESPN’s dominance in the sports sector, as reported by Front Office Sports.
Sources told Front Office Sports that Disney could see their deal blocked depending on how they handle Kimmel's future.
Former White House press secretary Ari Fleischer said the NFL and ESPN deal could be "political catnip" for Trump.
"Given his interest in the NFL, and his history of using media mergers for leverage, it's hard to see him not playing around with this," Fleischer told Front Office Sports. "I doubt this will be a straightforward commercial transaction."
The NFL is a big piece of Disney's sports segment. The company pays $2.7 billion annually for rights to "Monday Night Football.” Risking the NFL merger could upset the league and limit the amount of football content on the new ESPN streaming app.
Kimmel collects a reported $16 million annually and his contract ends in May 2026. Kimmel suggested last year that he could leave ABC or retire after his current contract ends.
The future of the NFL and ESPN asset swap approval, and whether Kimmel apologizes or makes a donation to the Kirk family on Tuesday, will be closely watched to gauge Disney’s future.
Disney Stock Price Action
Disney stock was down 1% to $122.56 on Monday versus a 52-week trading range of $80.10 to $124.69. Investors appeared to like the news. Shares reversed larger losses at the time of the announcement that Kimmel's show was coming back. Still, Disney stock is down 5.3% over the past month.
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