Disney CEO Bob Iger has confirmed the first of three rounds of layoffs is starting this week as the company looks to reduce its workforce by about 7,000 employees.The exec’s memo to employees tracks closely with what Deadline exclusively reported last week — three rounds of cutbacks, with the second slated to be the deepest. This week’s initial round comes a few days before the company’s annual shareholder meeting on April 3. Iger first announced plans for the downsizing in February, describing it as a key to achieving $5.5 billion in cost savings. Managers have been finalizing details of the new structure during subsequent weeks.“In tough moments, we must always do what is required to ensure Disney can continue delivering exceptional entertainment to audiences and guests around the world – now, and long into the future,” Iger wrote in the memo.Iger returned to the top job in November after stepping down in 2020 following a 14-year CEO stint. He faces a host of challenges in steering the media giant the second time around, including a more adverse macroeconomic climate and far greater Wall Street skepticism about the economics of streaming. He has already dismantled the centralized distribution structure implemented by former CEO Bob Chapek and set up three corporate divisions. It is expected that all three divisions – Parks, Experiences and Products; Entertainment; and ESPN will be part of the layoffs. The Entertainment division should see significant cuts on the business and content sides at Hulu as well as sister studios ABC Signature and 20th Television, sources have told Deadline.The restructuring comes as the company evaluates a number of strategic options. While Iger has maintained that ESPN is likely to stay in the corporate fold, though it could offer a stand-alone streaming version in the not-too-distant future. Meanwhile, the CEO has indicated all scenarios are on the table for Hulu, which Disney operates but does not fully own. Comcast’s 33% financial stake can be bought out by Disney in early 2024, or Disney could decide to unload the streaming operation. An exit seems possible given Iger’s less-than-rosy commentary lately about the prospects for general-entertainment streaming.The reduction in staff could be a tonic for Disney’s stock, at least in the short term. As with many media stocks over the past year-plus, Disney shares have hit hard times, losing about half their value since summer 2021. While the stock surged after Iger’s return, it has mostly moved sideways in recent months.
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