Disney is the newest company to join the list of companies laying off employees. The company is planning to lay off 7,000 workers to cut costs across the company. The announcement was made by CEO Bob Iger in an earnings call on Wednesday. Iger called the move “necessary to address the challenges we’re facing today.”

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Iger said in the call that the company was “targeting $5.5 billion of cost savings” and that the layoffs will “help achieve this.” Iger didn’t say which departments the layoffs will affect.

As soon as Iger took over for outgoing Disney CEO Bob Chapek last November, layoff rumours began to circulate. Iger stepped down from the role in 2020, and his takeover of the company has already impacted the organisation in a significant way. In addition, Iger is establishing three core divisions at Disney: Disney entertainment, ESPN, and Disney Parks.

Also read: Dell layoffs to affect over 6,600 jobs as company faces decline in PC sales

According to a report by Reuters, this marks Disney's third restructuring in five years and marks a new chapter in the leadership of Iger, who first became CEO in 2005. Iger, who returned to the role in November 2022, will now seek to put Disney's streaming business on a path to growth and profitability while restoring decision-making to the company's creative leaders.

When it comes to financials, the company in the first quarter of the financial year 2023 saw a slowdown in subscriber growth for Disney Plus. The vertical has just 200,000 subscribers in the US and Canada for a total of 46.6 million, while its international offering (excluding HotStar) saw the addition of 1.2 million members. Similar slow growth was seen on Hulu and ESPN Plus, which added 800,000 and 600,000 subscribers, respectively.

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A 13 percent increase in revenue was seen in Disney's direct-to-consumer division, which includes its streaming services. In spite of this, it still had an operating loss of $1.1 billion, attributed to higher costs at Disney Plus and Hulu. In the quarter, the company lost about $1.5 billion on its streaming business.

“Our priority is the enduring growth and profitability of our streaming business. Our current forecasts indicate Disney Plus will hit profitability by the end of fiscal 2024, and achieving that remains our goal,” said Iger.

The layoffs come amidst a barrage of job cuts in the technology and media sector. So far, as per data by Layoffs.fyi globally, 321 tech companies have laid off over 90,000 employees.

Also read: Mass layoffs sweep big corporations – Google, Amazon among top companies cutting jobs in 2023

First Published:Feb 9, 2023 9:26 AM IST