According to a statement addressed to staff and reviewed by the media, Walt Disney Co started 7,000 layoffs planned earlier this year as it strives to minimize expenses and build a more "streamlined" operation.
According to a person familiar with the situation, several main departments of the corporation - Disney Entertainment, Disney Parks, Experiences and Products, and corporate - will be impacted. ESPN was not affected by this week's round of cuts, but it is expected to be included in subsequent ones.
The entertainment sector has retreated from its initial exuberant embrace of video streaming, when established media corporations wasted billions by launching competitors to Netflix Inc.
After Netflix reported its first subscriber loss in a decade in early 2022, media businesses began to cut down on investment, and Wall Street began to prioritize profitability over subscriber growth.
Iger stated that Disney will start informing the first group of employees affected by the staff cutbacks within the next four days. A second, larger round of layoffs will take place in April, with "thousands more personnel reductions." The last round will begin before the end of the summer, according to the letter.
The Burbank entertainment behemoth stated in February that it would cut 7,000 positions as part of a $5.5 billion cost-cutting push to turn its loss-making streaming division profitable.
"The difficult reality of many colleagues and friends leaving Disney is not something we take lightly," Iger wrote, noting that many "bring a lifelong passion for Disney" to their work.
A source stated that one of the first sectors targeted for downsizing was television production and acquisition divisions, which resulted in the departure of senior executives.
The business had been tight-lipped about the layoffs, while insiders predicted they would take place before Disney's annual shareholder meeting on April 3.
Fear has been developing within Disney as whispers about potential budget cuts circulated.
"It’s a dark, black box," said one Disney executive who spoke to Reuters last week.
Many expected the Disney Media and Entertainment Division, which was disbanded as part of a corporate restructure, to bear the brunt of the losses. Since Kareem Daniel's departure in November, shortly after Iger's return as CEO, the unit has been without a head.
“It’s been a long time in the making,” said SVB MoffettNathanson analyst Michael Nathanson, adding that the company first began “to whisper” about the need to take out costs last fall, when Bob Chapek was still Disney’s chief executive.
In February, Josh D'Amaro, chair of Disney Parks, Experiences, and Products, delivered a note to theme park staff warning that the profitable segment will be slashed.
Representatives from two unions representing cast members at Walt Disney World Resorts in Orlando, Florida, claimed the layoffs would not impair "guest-facing" services.
"I don’t see where, when there are labor shortages in front-facing guest roles, it would be a good decision to lay off workers where the money train starts for the Walt Disney Co," said Paul Cox, president of the International Alliance of Theatrical Stage Employees Local 631.
(Source:www.moneycontrol.com)
According to a person familiar with the situation, several main departments of the corporation - Disney Entertainment, Disney Parks, Experiences and Products, and corporate - will be impacted. ESPN was not affected by this week's round of cuts, but it is expected to be included in subsequent ones.
The entertainment sector has retreated from its initial exuberant embrace of video streaming, when established media corporations wasted billions by launching competitors to Netflix Inc.
After Netflix reported its first subscriber loss in a decade in early 2022, media businesses began to cut down on investment, and Wall Street began to prioritize profitability over subscriber growth.
Iger stated that Disney will start informing the first group of employees affected by the staff cutbacks within the next four days. A second, larger round of layoffs will take place in April, with "thousands more personnel reductions." The last round will begin before the end of the summer, according to the letter.
The Burbank entertainment behemoth stated in February that it would cut 7,000 positions as part of a $5.5 billion cost-cutting push to turn its loss-making streaming division profitable.
"The difficult reality of many colleagues and friends leaving Disney is not something we take lightly," Iger wrote, noting that many "bring a lifelong passion for Disney" to their work.
A source stated that one of the first sectors targeted for downsizing was television production and acquisition divisions, which resulted in the departure of senior executives.
The business had been tight-lipped about the layoffs, while insiders predicted they would take place before Disney's annual shareholder meeting on April 3.
Fear has been developing within Disney as whispers about potential budget cuts circulated.
"It’s a dark, black box," said one Disney executive who spoke to Reuters last week.
Many expected the Disney Media and Entertainment Division, which was disbanded as part of a corporate restructure, to bear the brunt of the losses. Since Kareem Daniel's departure in November, shortly after Iger's return as CEO, the unit has been without a head.
“It’s been a long time in the making,” said SVB MoffettNathanson analyst Michael Nathanson, adding that the company first began “to whisper” about the need to take out costs last fall, when Bob Chapek was still Disney’s chief executive.
In February, Josh D'Amaro, chair of Disney Parks, Experiences, and Products, delivered a note to theme park staff warning that the profitable segment will be slashed.
Representatives from two unions representing cast members at Walt Disney World Resorts in Orlando, Florida, claimed the layoffs would not impair "guest-facing" services.
"I don’t see where, when there are labor shortages in front-facing guest roles, it would be a good decision to lay off workers where the money train starts for the Walt Disney Co," said Paul Cox, president of the International Alliance of Theatrical Stage Employees Local 631.
(Source:www.moneycontrol.com)
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