The Disney group is considering the possibility of cutting thousands of jobs and has asked some managers to aim for annual savings of 20%. This is what Bloomberg reported, citing sources familiar with the matter.
Streaming competition and fewer people in the parks
The new round of layoffs comes after a round of redundancies involving hundreds of positions. The rumored restructuring comes as CEO Josh D’Amaro faces challenges including the growing use of artificial intelligence, declining box office receipts, intensifying competition from streaming rivals and slowing international attendance at the entertainment company’s theme parks.
In particular, la maneuver is born by the need to counter the progressive decline of traditional TV and the cable model, penalized by the constant phenomenon of cord cutting (“cord cutting”, fewer and fewer pay TV subscribers and migration towards Netflix – itself struggling with staff cuts -, YouTube and the web in general). At the same time, the group must cope with rising production costs and the transition towards pay streaming, an investment-intensive sector that requires continuous capital reallocation. The savings generated by staff departures and the revision of the operating budget will be used to finance the highest performing projects.
Savings in film programs
Some Disney divisions are reportedly expected to take a larger share of the cuts than others, and D’Amaro aims to reinvest some of the savings in film and television programming, technology, theme parks and cruise ship businesses.