Disney is set to continue its cost-cutting measures, with ESPN beginning to implement layoffs next week, according to people familiar with the matter.
The job cuts will include some on-air talent and management, and the number of employees affected is still unclear. The decision-making process is still fluid, and ESPN has declined to comment on the situation. The move is part of Disney’s wider plan to eliminate 7,000 jobs in three rounds, with the second round scheduled for next week.
In addition, the company will also lay off about 15% of its entertainment division’s staff next week, according to a report by Bloomberg.
Disney’s CEO, Bob Iger, has been keen to cut costs as streaming losses persist, and ESPN’s cost-cutting measures come as the network is looking to renew its contract with the National Basketball Association.
Renewal discussions are already underway, and ESPN will likely have to pay a significant premium on the $1.4 billion per year rights fee it currently pays the league. Disney announced earlier this year that it plans to cut $5.5 billion in costs, including $3 billion in content spending.
ESPN laid off approximately 300 employees last year, and this round of job cuts is part of the network’s ongoing effort to streamline its operations. Disney underwent a reorganization earlier this year, with ESPN now releasing its financials as its own division for the first time. This change will offer a clearer view of ESPN’s business and its financial performance.
Disney’s first round of job cuts occurred last month, which included its metaverse strategies unit and part of its Beijing office. With ESPN now undergoing job cuts, it seems that Disney is willing to take drastic measures to achieve its cost-cutting goals.
Disney is set to report its earnings on May 10, and it remains to be seen how the company’s cost-cutting efforts will impact its financial performance.
ESPN’s Plans for Layoffs
Disney’s ongoing cost-cutting measures will soon impact ESPN, with the network set to begin layoffs next week. The exact number of employees affected is still unclear, but the job cuts will include some on-air talent and management.
The move comes as part of Disney’s wider plan to eliminate 7,000 jobs in three rounds, with the second round scheduled for next week.
While Disney is looking to boost its free cash flow, ESPN is also interested in renewing its contract with the National Basketball Association, which could require a significant premium on its current rights fee.
ESPN laid off approximately 300 employees in last year, and the current round of job cuts is part of the network’s ongoing effort to streamline its operations. Disney’s reorganization earlier this year means that ESPN will release its financials as its own division for the first time, offering greater transparency into the network’s financial performance.
The impact of the reported layoffs at ESPN will be significant for both the affected employees and the company itself.
Losing on-air talent and management could lead to a decline in the quality of programming and affect viewership, which could hurt advertising revenue. It could also potentially harm the network’s ability to secure future rights deals, such as with the National Basketball Association.
For the employees facing layoffs, the impact will be even more direct and immediate. They will face the loss of their jobs and potentially struggle to find new employment in a difficult job market.
The layoffs could also affect the morale of remaining employees, who may be worried about their own job security and the future of the company.
The broader impact of Disney’s cost-cutting efforts, which include the reported layoffs at ESPN, could be felt throughout the entertainment industry.
As one of the largest media conglomerates in the world, Disney’s actions could set a precedent for other companies looking to cut costs in the face of economic uncertainty.
