Disney reorganizes, will layoff 7,000 employees, restore dividend
The Walt Disney Company will reorganize its business units, implement $5.5 billion in cost savings and will be laying off 7,000 employees in an attempt to rebalance the company and re-introduce the dividend that was stopped during COVID-19, CEO Bob Iger said during today’s earning calls.
Disney is slimming down its core businesses into three business segments – Disney Entertainment, ESPN and Disney Parks, Experiences and Products.
“Moving forward our creative teams will determine what content we are making, how it is distributed and monetized and how it gets marketed. Imagine costs, maximizing revenue and driving growth being produced will be their responsibility,” Iger said.
Those decisions had been taken away from the creative teams under the reorganization by former CEO Bob Chapek,
Alan Bergman and Tina Walton will be the co-chairmen of Disney entertainment, “which will include the company’s full portfolio on entertainment media and content businesses globally. Including streaming.”
Jimmy Pitaro will remain the head of ESPN and Josh D’Amaro will continue to lead Disney Parks.
“The changes will result in a more cost cost-effective instrument approach to our operations. We are committed to running our businesses more efficiently, especially in our challenging economic environment,” Iger said.
Disney is targeting $5.5 billion in cost savings across the company. Reductions include non-content costs of about $2.5 billion not adjusted for inflation and $3 billion as content.
“To help achieve this will be reducing our workforce by approximately 7,000 jobs, while this is necessary to address the challenges we are facing today, I do not make this decision lightly. I have enormous respect and appreciation for the talent and dedication of our employees worldwide and mindful of the personal impact of these changes” Iger said.
“Now, when it comes to investing in growth and returning capital to shareholders we will take a balanced and disciplined approach as we did throughout my previous tenure as senior,” Iger said.
He said he will ask the board to reinstate dividends to shareholders by the end of 2023.
