Following a dismal quarter, the Walt Disney Company plans to freeze hiring and slash some jobs ahead of the Christmas holidays, according to a report. In a statement to employees, Disney CEO Bob Chapek stated that the business would prioritize cost-cutting initiatives, including “certain workforce cutbacks.”
“I am completely aware that for many of you and your teams, this will be a painful journey,” Chapek wrote. “We’ll have to make some difficult and unsettling judgments. But that is exactly what leadership necessitates, and I thank you in advance for stepping up during this critical period.”
“As we continue through this evaluation process, we will look at every avenue of operations and labor to discover savings, and we do anticipate some personnel layoffs as part of this review,” Chapek wrote in a Friday memo.
The CEO also stated that the company would limit the number of new employees it employed and would only hire for the “most vital, business-driving positions.”
“We are limiting new hires through a targeted hiring freeze. Hiring for the most vital, business-driving positions will continue, while all other positions are on pause. Your segment leaders and HR teams may provide more specifics on how this will affect your teams.”
Disney employs around 190,000 people, a statistic that has been declining year after year since 2018.
The message is the most recent corporate indicator of how Disney intends to respond to a dismal quarter that appeared to demoralize investors. The stock dropped to a 52-week low of slightly under $87 on Wednesday, down from $101 on Monday. They had since recovered to around $95 by Friday evening.
In the memo, Chapek also stated that Disney will form a “cost structure taskforce” to further reduce the company’s spending. The CEO, Chief Financial Officer Christine McCarthy, and General Counsel Horacio Gutierrez will lead it.
The memo comes only days after McCarthy outlined Disney’s desire to undertake both short-term and long-term financial improvements.
“We are currently actively assessing our cost base and searching for considerable efficiencies,” she said. “Some of these will result in short-term savings, while others will result in long-term structural improvements.”
Disney has suffered significant losses as unstoppable inflation continues to pinch customers’ wallets. And, while the Disney+ streaming service continues to grow in popularity – the firm reported a 12.1 million subscriber increase this quarter operating losses continue to mount. Disney lost roughly $1.5 billion in its fiscal fourth quarter.
The company has also been mired in issues, such as its outspoken opposition to Florida Gov. Ron DeSantis’ signing of a measure that prohibits the teaching of sexual orientation in schools, as well as charges that it is too “woke” for certain customers.
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