World famous production company, Walt Disney has decided to lay off employees as part of cutting costs and avoidable expenses. The company has also decided to freeze hiring in various departments and segments of the business entity.
A few days ago Walt Disney reported a quarterly loss of 1.5 billion dollars for the last quarter which ended in September. Shares of Walt Disney tumbled on US Stock markets by nearly 13 percent since the company published quarterly earnings reports.
Chief Executive Officer of the company, Bob Chapek on Friday told executives at the senior vice president level that they may have to take very tough and uncomfortable decisions regarding lay-offs and hiring freeze. The information was passed down by CEO as a memo.
In the memo, Bob Chapek said, “I’m fully aware this will be a difficult process for many of you and your teams. We are going to make tough and uncomfortable decisions. While certain macroeconomic factor is out of our control, meeting these goals require us to continue doing our part to manage the things we can control- most notably, our costs,”
The multi-billion dollar company headed by Susan Arnold and Bob Chapek has been trying to make its direct-to-customer streaming division more profitable. Huge losses and increasing costs suffered by the streaming division are cited as one of the major factors for the widening loss of the company during the last quarter.
Market analysts and economists had earlier expressed their concerns regarding the increasing streaming costs for digital platforms owned by Walt Disney. A Wall Street analyst, Michael Nathanson told news agencies that “the company has to prove that their pivot to DTC will be worth the investment price that is currently being paid.”
Another American entertainment giant, Warner Bros Discovery is also facing similar challenges. Warner Bros Discovery is also implementing harsh cost-cutting measures in the forms of lay-offs, hiring freezes, etc. The company is also trying to restructure its operations as it underwent a major merger few months ago.
