The Walt Disney Co. laid off nearly 300 workers this week, a move that comes amid broader industry consolidation reverberating throughout Southern California. The cuts largely affected the company's human resources and technology divisions.
Separately, Disney offered early retirement packages to older workers. This voluntary separation program is currently underway, though the exact number of executives who will participate later this year has not yet been determined, according to one knowledgeable source.
These changes come as Disney Chief Executive Josh D’Amaro, who took the reins in March, seeks to put his imprint on the company. D'Amaro has begun organizing the company around a “One Disney” approach, aiming to dismantle corporate silos that emerged following large acquisitions, such as the 2019 takeover of much of 21st Century Fox.
In related efforts, Disney has been working to establish Disney+ as its central streaming hub over the past year. This initiative includes a move to diminish the Hulu service and brand. Disney employees are anticipating further reductions, with expectations of a significant television division restructuring early next year, which could lead to hundreds more layoffs. The company's legal government affairs department is also slated for downsizing, according to a recent internal memo from Disney Chief Legal Officer Horacio Gutierrez. A Disney spokesperson declined to comment on the changes.
Financially, the Walt Disney Co. saw record quarterly revenue from its theme parks division. However, issues like its Fubo deal and a YouTube carriage dispute negatively impacted total segment operating income.
Disney President Dana Walden addressed the prevailing industry turmoil during an appearance at Bloomberg News’ Screentime media conference. She noted that traditional studios and TV networks have shed tens of thousands of workers in recent years, a consequence of the streaming bubble bursting and twin labor strikes that paused projects. Walden acknowledged that restructurings are necessary as companies adapt to changing consumption patterns that have eroded more lucrative traditional TV economics.
Walden described the current situation as "extremely painful," noting the departure of long-time colleagues. She characterized Disney’s voluntary retirement program as “generous,” designed to give “long-tenured executives agency and the opportunity to make their own decisions around whether the timing was right to leave.” In a broader context, a bipartisan group of Congressional leaders is advocating for a 20% federal tax credit for film and TV production, aiming to bring filming back to the U.S. Meanwhile, workers at Warner Bros. Discovery also face uncertainty regarding potential layoffs following an upcoming takeover by David Ellison, which seeks $6 billion in cost reductions.
