Disney Slashes Jobs
Disney’s CEO Bob Iger has announced the start of mass layoffs at the company, with plans to cut 7,000 jobs this year in an effort to slash $5.5 billion in costs. The news comes after the company announced plans to restructure its organization into three core business segments: Disney Entertainment, ESPN, and Disney Parks, Experiences and Products. The layoffs will take place over the next few months, with the final round of job cuts to be completed before the beginning of the summer. Iger warned of “challenges ahead” for the employees still present at the company.
Disney stock was little changed on the heels of the news, with shares up about 10% since the start of the year. The company’s streaming division, Disney+, is on track to achieve profitability by the end of fiscal 2024 after losses narrowed to $1.1 billion in the latest quarter.
The new strategic organization is expected to result in a more cost-effective, coordinated and streamlined approach to Disney’s operations. Alan Bergman and Dana Walden will be co-chairs of Disney Entertainment, which will include the company’s full portfolio of entertainment media and content businesses globally, including streaming. Jimmy Pitaro will continue to serve as chairman of ESPN, which will include ESPN Networks, ESPN+, and its international sports channels, while Josh D’Amaro will continue to be chairman of Disney Parks, Experiences and Products.
In his internal memo to employees, Iger acknowledged the difficult reality of many colleagues and friends leaving Disney, and asked for the continued understanding and collaboration of those still employed by the company. He stressed his commitment to creating a direct link between content decisions and financial performance, and emphasized the need to run the business more efficiently, especially in a challenging economic environment.
The news of the layoffs is sure to have an impact on the broader entertainment industry, and may lead to further consolidation and restructuring as companies seek to cut costs and adapt to changing consumer behavior. As the industry continues to evolve, it will be interesting to see how companies like Disney navigate the challenges ahead and position themselves for long-term success.
DIS Stock Forecast & Analysis
The average analyst target price for Walt Disney Company over the next 12 months is USD 126.39, with a strong buy rating. Stock Target Advisor’s analysis of the stock is slightly bullish, with 8 positive signals and 4 negative signals. As of the last closing, the stock price was USD 94.08, which is up by 0.94% over the past week, but down by 6.20% over the past month and 32.38% over the last year.
