Disney has started implementing the first round of job cuts as part of a $5.5 billion cost-cutting programme, which is expected to affect 7,000 jobs. The announcement was made by CEO Bob Iger in a memo to employees on March 27, with the first group of affected workers receiving notifications over the next four days.
A second round of layoffs is planned for April, affecting several thousand workers, with the remaining affected employees to be notified before summer.
Iger, who returned to the company in November 2022, has been tasked with improving the financial performance of the company. One of his biggest challenges is making the company’s streaming TV businesses profitable, which lost over $1 billion in the quarter ending December 2022. Iger has already begun restructuring the company, giving more power to creative leaders such as Dana Walden and Alan Bergman.
“A second, larger round of notifications will happen in April with several thousand more staff reductions, and we expect to commence the final round of notifications before the beginning of the summer to reach our 7,000-job target," he added.
The first round of job cuts includes two senior vice presidents who led production at Hulu and the Freeform network, respectively, and a unit that licensed books, podcasts, and other stories for TV shows has been dissolved. The restructuring will affect all parts of the company, including theme parks and ESPN sports networks.
The cost-saving programme is expected to save $3 billion from its budget for films and TV shows, and the remaining $2.5 billion from reductions in operating costs. Disney's stock rose by 1.6% on Monday, closing at $95.62. The stock fell by 44% in 2022, the second straight annual decline.
With Inputs from Agencies