Disney moves toward thousands of job cuts in 20% cost push

By Amara Osei

How large are the planned cuts?

Bloomberg’s Thomas Buckley reported that Walt Disney Co. is moving toward thousands of job cuts while asking some managers to target 20% in annual cost savings.

People familiar with the matter said the savings could come from job eliminations or expense reductions. They requested anonymity because the discussions are private.

Bloomberg did not identify every affected manager, cost line or division in the 20% request. Disney declined to comment, leaving the timing and final number of positions unconfirmed.

The savings target is concrete; the scale of layoffs remains provisional.

Which businesses face the deepest impact?

According to the people familiar with the matter, some operations will face disproportionate reductions. They include Disney’s theme parks, television channels and movie studio.

The planned layoffs affect the company’s experiences division, which includes its theme parks, cruise line and Aulani resort and spa in Hawaii.

Chief Executive Officer Josh D’Amaro aims to reinvest part of the savings in film and television programming, technology, and the theme park and cruise ship businesses, the people said.

Disney has promised double-digit growth in adjusted earnings per share (EPS), a per-share profitability measure, in the current fiscal year. The report did not reconcile that promise with the cost target or provide a savings timetable.

The reinvestment plan would put some recovered spending back into businesses facing reductions. Disney has not said how much of the savings would be reinvested.

How does this fit Disney’s recent record?

Disney has cut billions of dollars in costs and eliminated thousands of positions in recent years, according to Bloomberg. The reductions reached every division, including ABC, Pixar, ESPN, the film studio and the experiences unit.

Bloomberg reported that the company employed 231,000 people worldwide at the end of the last fiscal year. The figure establishes the scale of the organization, but the report did not quantify the planned reduction.

On Oct. 1, The Wall Street Journal reported that Disney planned to restructure its television division and cut staff in its legal and global affairs unit.

The proposed cuts would extend, rather than begin, a cost-reduction cycle across the company. The newspaper’s report covered structural changes in television and support functions; Bloomberg’s sources described a wider range of operating reductions.

Why are media companies cutting jobs?

Bloomberg also listed job cuts at Netflix Inc., Sony Pictures Entertainment and Skydance Corp., along with the Paramount and Warner Bros. divisions.

Traditional-television revenue is declining and streaming-subscriber growth is slowing, according to Bloomberg. More viewers are tuning to social media, online video and streaming services backed by technology companies such as Amazon.com Inc. and Apple Inc.

Those industry forces do not establish how many Disney jobs the 20% target would remove. Disney’s request to some managers remains an internal measure, not a disclosed companywide program.

What has Disney said?

At the Bloomberg Screentime conference in Los Angeles last month, Disney President Dana Walden said: “there is a need to constantly evaluate how you’re structured and how big is the organization. Technology set their sights on our business and we must survive and thrive and grow, and that’s what we’re going to do.”

Her statement described continuing organizational evaluation. It did not confirm the layoffs, the 20% savings target or a timetable.

The next test is whether Disney can turn an internal savings request into disclosed cuts while preserving the adjusted EPS growth it has promised.