Disney CEO Bob Chapek informed executives in an email that layoffs are likely on the way, along with a hiring freeze and a request to limit travel unless authorized.
NEW: Disney CEO Bob Chapek just announced a “targeted hiring freeze” at the company, according to a memo sent to company leads.
“We are limiting headcount additions through a targeted hiring freeze.” Chapek said hiring for “critical, business-driven positions” will continue.
— Scott Gustin (@ScottGustin) November 11, 2022
Chapek’s announcement comes days after a November 8 Disney earnings report revealed the media juggernaut’s missed expectations by over $1 billion, according to a Wall Street Journal report. In the fourth quarter alone Disney lost nearly $1.5 billion on its “Disney+” streaming service, 40% lower than what analysts forecasted.
Chapek described the report as a sign of Disney’s “strong year.”
“I’m fully aware this will be a difficult process for many of you and your teams,” Chapek said in the email to executives. “We are going to have to make tough and uncomfortable decisions.”
He failed to mention the exact number of layoffs but said that Chief Financial Officer Christine McCarthy and general counsel Horacio Gutierrez will be heading a team to address administrative spending, marketing, and content.
Disney has lost over $8 billion since entering the streaming realm three years ago with the creation of Disney+. The earnings report indicates that Disney plans to begin turning a profit in the fiscal year 2024.
“I have no doubt we will achieve our goals and create a more nimble company,” said Chapek in the memo.
Chapek’s announcement comes after Twitter’s new CEO Elon Musk just fired nearly half of his 7,500 employees. “There seems to be 10 people ‘managing’ for every one person coding,” Musk tweeted last week.
Facebook-parent “Meta” also cut ties with a large chunk of its workforce after firing 11,000 of the company’s 87,000 overall employees on November 8.