According to a new report by Bloomberg, Disney is reportedly planning thousands of job cuts next week, which will include slashing 15% of its entertainment division.
Per the Bloomberg report, the cuts will impact several areas within the entertainment division, such as TV, film, theme parks, and corporate teams. Per the report, every region Disney operates will be affected, with impacted personnel notified as early as April 24.
Additionally, CNBC reported Wednesday afternoon that ESPN will begin layoffs early net week. Yahoo Finance reached out to Disney for comment on both reports but did not immediately hear back.
In addition to the announcement of the layoffs in February, Disney also disclosed plans to restructure the organization in to three core business segments: Disney Entertainment, ESPN, and Disney Parks, Experiences and Products.
At the time, Iger said the new strategic organization, “will result in a more cost-effective coordinated and streamlined approach to our operations.”
“We expect cost reduction initiatives to really start to kick in during the June and Sept quarters, driving loss improvement in Streaming and smaller [year-over-year operating income] declines in Linear Networks,” Deutsche Bank said in a new note on Tuesday, reiterating its Buy rating on the stock.
The bank, especially bullish on Disney’s theme parks division and upcoming film slate, sees an “attractive setup” for shares in the back half of this year, writing: “DIS’s [fiscal third quarter] will be an earnings inflection point as the company flips from three consecutive quarters of earnings declines back to sustained positive earnings growth.”
This plan was part of the company’s efforts to eliminate $5.5 billion in costs. The company went through its first round of layoffs at the end of March with more jobs to be cut before the start of the summer to complete the 7,000-job target.
Disney is set to report its fiscal second quarter earnings results on May 10.
What are your thoughts on Disney laying off 15% of its entertainment division beginning next week? Let us know in the comments!
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