According to a memo from CEO Bob Iger, Disney will start laying off employees this week. This will be the first of three rounds of layoffs before the start of the summer, which will result in the loss of nearly 7,000 jobs. The cuts are part of a larger initiative to lower company expenses and increase free cash flow. Disney announced last month that it would reduce spending by $5.5 billion, including $3 billion on content.
Iger stated in the memo, which CNBC was able to get, that “this week, we begin contacting employees whose positions are impacted by the company’s staff reductions.” During the course of the following four days, leaders will immediately inform the first group of impacted employees of the news. We anticipate starting the final round of notifications before the start of the summer to accomplish our 7,000-job target.
A second, larger wave of notifications will take place in April with thousands more personnel cutbacks. The initial announcement of the layoffs was made in February. The company-wide layoffs will affect ESPN, Disney’s parks and resorts, and its media and distribution operations.
Disney is imitating Warner Bros. Discovery and other traditional media businesses that are reducing investment and hiring. Disney has stated that in 2024, its streaming division, which is dominated by Disney+, Hulu, and ESPN+, will stop losing money. Following a 44% decline in value last year, Disney stock is up roughly 8% this year.
Iger stated, “As part of a strategic restructuring of the company, including significant cost-saving measures necessary for building a more effective, integrated, and streamlined approach to our business, we have decided to decrease our entire staff by about 7,000 jobs. “For those of our colleagues who are unaffected,
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I want to acknowledge that there will undoubtedly be difficulties as we continue to develop the systems and processes that will allow us to succeed going forward.” Iger has overhauled the business since taking over as CEO and said he would think about selling Hulu. Disney’s annual shareholder meeting will take place on April 3.
Read the entire memo from Iger:
Dear Fellow Employees,
As I mentioned to you in February, as part of a strategic realignment of the company that includes significant cost-saving measures required for developing a more effective, coordinated, and streamlined approach to our business, we have made the difficult decision to reduce our overall workforce by roughly 7,000 jobs.
I want to provide you with an update on senior executives’ recent efforts to examine their operational needs in close collaboration with HR. We start informing workers this week whose jobs will be affected by the company’s staff reductions. Over the next four days, managers will immediately inform the initial group of impacted employees of the news.
We anticipate starting the final round of notifications before the start of the summer to accomplish our 7,000-job target. A second, larger wave of notifications will take place in April with thousands more personnel cutbacks. We do not take lightly the difficult reality that many of our coworkers and friends are leaving Disney.
The world’s most talented and committed workers work for this organization, and many of you have had a lifelong passion for Disney that you bring to your work. That’s one of the unique aspects of working at Disney. Also, it makes saying goodbye to amazing individuals we care about even harder. I want to express my sincere gratitude to each departing employee for their many efforts and dedication to this cherished business.
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For those of our colleagues who won’t be touched, I want to acknowledge that there will undoubtedly be difficulties as we continue to develop the systems and processes that will help us succeed in the future. I continue to appreciate your cooperation and understanding throughout this period.
In difficult times, we must always take the necessary steps to guarantee that Disney can keep providing world-class entertainment to audiences and guests – now, and far into the future. Please be assured that our HR leaders and partners are dedicated to making the entire process encouraging and simple. I want to express my gratitude to each of you once more for all of your successes at The Walt Disney Company.
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