On Wednesday, Walt Disney announced that it plans to discharge about 7,000 employees. The plan is part of its dedication to cutting costs by $5.5 billion in the coming months.

By so doing, Disney will be the most recent high-profile company to lay off workers in the middle of an unpredictable global economy.

Google, Microsoft, Amazon, Facebook, and Meta are some of the companies that have already announced their decision to let go of a good number of their staff.

Disney will reduce its workforce by 7,000 employees in a bid to cut costs, CEO Bob Iger said. The layoffs are part of Disney’s efforts to achieve about $5.5 billion in cost savings. https://t.co/Fj8bWt2Kx3 pic.twitter.com/WpojK0U66v

— Variety (@Variety) February 8, 2023

In a Wednesday conference call with wall street analyst, the chief executive Bob Iger said, “While this is necessary to address the challenges we’re facing today, I do not make this decision lightly.” 

Emphasizing the need for “strategic reorganization” of the company, he said, “We must return creativity to the center of the company, increase accountability, improve results and ensure the quality of our content and experiences.

“Our new structure is aimed at returning greater authority to our creative leaders and making them accountable for how their content performs financially,” he added.

The cuts will amount to 3.6% of its global force. However, the aim is to grow the profit margin of Disney’s streaming business.

Iger said that the company would focus more on core brands and franchises. Moreover, some franchises owned by Disney are; Marvel, Star Wars, and Pixar.

More layoffs hitting media as Disney says it will cut 7000 jobs. pic.twitter.com/tG5wnT4jFY

— Joe Flint (@JBFlint) February 8, 2023

The Return of Bob Iger 

Bob Chapek succeeded Bob Iger, who had previously held the position of CEO at Disney from 2005 to 2020. His tenure was relatively short and filled with pandemic and public relations challenges. 

The Disney board laid-off Chapek and brought back Iger as the CEO in November. This news came as a huge surprise for the entertainment industry.

In a statement by Susan Arnold, Disney’s chairman, she said, “The Board has concluded that as Disney embarks on an increasingly complex period of industry transformation, Bob Iger is uniquely situated to lead the company through this pivotal period.” 

She also added that “Iger has the deep respect of Disney’s senior leadership team.” According to her, Disney employees worldwide greatly admire him.

In a statement by Iger, he also expressed how thrilled and optimistic he was about the future of Disney.

Iger said, “I am deeply honored to be asked to again lead this remarkable team, with a clear mission focused on creative excellence to inspire generations through unrivaled, bold storytelling.” 

Why is Disney Cutting Jobs?

According to Iger, job cuts are essential to the transformation process. The company will restructure into three main segments; ESPN; theme parks; entertainment, movies, and the Disney Plus streaming service.

“Streaming is instrumental to the company’s future success,” said Iger. In addition, the company revealed that Disney Plus lost about 2.4 million subscribers between October and December.

However, Disney was able to generate revenue to the tune of $23.5 billion for the quarter. The amount is an 8 percent increase in comparison to last year.

Furthermore, in Iger’s words, “the company aims to make Disney Plus profitable by the end of 2024.”

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