What happened

Shares of Walt Disney (DIS -0.09%) ran higher on Thursday, surging as much as 5.7%. As of 10:38 a.m. ET, the stock was still up 2.6%.

The catalyst that caused the media giant's stock to rally was better-than-expected financial results, coupled with a well-received turnaround strategy.

So what

Disney reported revenue that grew 8% to $23.5 billion, fueled by a robust performance from the company's theme parks, experiences, and products segment. Excluding certain items, diluted earnings per share (EPS) declined 7% to $0.99.

To give its results context, analysts' consensus estimates called for revenue of $23.4 billion and EPS of $0.78. 

All eyes were on the company's direct-to-consumer segment, after the streaming business lost a hefty $1.68 billion in Q4 and $4 billion in fiscal 2022. Losses at the segment narrowed to roughly $1 billion, showing that things were moving in the right direction.

Perhaps most importantly, on the conference call, recently reinstated CEO Bob Iger laid out a far-reaching reorganization strategy to position the company for future success. Disney plans to cut 7,000 jobs, or roughly 3.6% of its worldwide staff. The company will also slash costs to the tune of $5.5 billion over the next couple of years. The reductions will come from sales, general, and administrative (SG&A) expenses ($2.5 billion), with the remaining $3 billion (annualized) coming from non-sports-related content spending. 

Furthermore, Iger revealed that Disney plans to reinstate a "modest" dividend by the end of calendar year 2022, increasing the payout over time.

Now what

The return of Iger was a welcome development for Disney shareholders, as the company looks to deal with runaway losses at its streaming segment and proxy battle with billionaire investor Nelson Peltz of Trian Fund. Peltz called Disney a "company in crisis" and had been agitating for a seat on Disney's board. The activist investor had also called for cost cuts, better succession planning, and a reinstatement of Disney's dividend. These issues have all been addressed -- causing Peltz to abandon his proxy fight.

Iger has the turnaround firmly in hand -- all the more reason to buy Disney stock.