This week will see the second (and largest) round of Disney layoffs. Several thousand employees are expected to lose their jobs from Monday to Thursday. Disney announced that the cuts would affect employees "from coast-to-coast".
CNN obtained a memo from Disney CEO Bob Iger that outlined the three rounds of layoffs. The layoffs will affect approximately 7,000 positions. ESPN, Disney Parks and other departments are expected to be affected by the cuts made this week.
The third and final wave is expected to be completed this summer.
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The mouse is cleaning the house.
This was the clear message that came through at Disney CEO Bob Iger’s first earnings announcement since he returned from retirement to lead the global entertainment giant.
Iger, in a shocking call with analysts announced a massive corporate restructuring which will result in the layoff of nearly 7,000 employees to save $5.5 Billion in costs. These job cuts represent approximately 3.6% of Disney’s global workforce.
Iger said that he did not take this decision lightly. "It is important to meet the challenges we face today," he added. Iger said, "I am grateful for the dedication and talent of our global employees and I am aware of the impact these changes will have on individuals."
Bob Iger returns as Disney CEO, and Bob Chapek steps down immediately
The House of Mouse, the latest U.S. firm to cut major jobs, follows in the footsteps of Google.
Iger said Disney wants its film and television business to be reanimated while cutting costs on "non-content operations" such as marketing and labor.
Iger stated that "we must bring creativity back to the core of the company and improve accountability, results, and the quality of content and experiences."
Iger announced that Disney would be reorganized into three different segments: an entertainment unit covering film, TV and streaming, an ESPN sports unit and Disney's parks, experiences and products.
He stressed that the streaming services of the company, including Disney+, ESPN+ and Hulu will remain " its #1 priority". He added, "we won't abandon the traditional or linear platforms as long as they are still a benefit for us and our investors."
Disney's employees may not be pleased with the news but Wall Street was. Disney shares soared by 6% after-market. Stock prices are up 26 percent after crashing in 2022.
Iger reported quarterly P&L figures that were better than most analysts expected.
Disney's subscribers to its streaming service dropped only 1% from 162 million to 164 million. ESPN+ and Hulu subscribers were up by 2%. Disney's theme park revenue increased by 36 percent to $2.1 billion.
Iger's return to Disney in 2022 marks the beginning of a new chapter. He was first appointed Disney CEO in 2005, retired in 2020 and returned in 2022.