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The longtime executive announced last month that the company would dismiss 7,000 workers as part of a “strategic realignment” meant to reduce costs. The layoffs expected this week will precede a “larger round of notifications” next month and a final round “before the beginning of the summer,” Iger said in a memo obtained by The Hollywood Reporter.
“For our employees who aren’t impacted, I want to acknowledge that there will no doubt be challenges ahead as we continue building the structures and functions that will enable us to be successful moving forward,” Iger told employees. “In tough moments, we must always do what is required to ensure Disney can continue delivering exceptional entertainment to audiences and guests around the world, now, and long into the future.”
Disney shares rose 0.8% on Monday morning upon the release of the memo; the company’s stock price has declined 31.7% over the past year.
Iger commented that the layoffs would enable “important cost-saving measures necessary for creating a more effective, coordinated and streamlined approach” to the company. He said last month during an earnings call that the firm’s new structure would center on “returning greater authority to our creative leaders and making them accountable for how their content performs financially,” according to another report from The Hollywood Reporter.
Several prominent firms have implemented headcount reductions after the increased hiring that many pursued in the wake of the lockdown-induced recession. Social media company Meta and e-commerce behemoth Amazon, for instance, announced multiple layoffs as investors noted the influx of employees, many of whom are no longer necessary given the present economic tumult.
Disney has also lost trust among some consumers after executives involved the firm in contentious culture war battles last year. Disney publicly opposed a parental rights law in Florida that bans instruction about sexual orientation and gender identity to children between kindergarten and third grade. In an exclusive poll from The Daily Wire, 64% of Americans, including 62% of Democrats and 57% of independents, nevertheless supported the law.
Gov. Ron DeSantis (R-FL) subsequently endorsed a bill that revoked special tax and regulatory privileges Disney had enjoyed in central Florida. Iger, who had been replaced by Disney executive Bob Chapek for two years before he recently returned as chief executive, expressed regret that the company lost the special privileges, promising company leadership would more carefully listen to consumers in the future.
“I was sorry to see us dragged into that battle, and I have no idea exactly what its ramifications are in terms of the business itself,” he told employees in leaked footage. “What I can say is that the state of Florida has been important to us for a long time, and we have been very important to the state of Florida.”
Disney reported a significant slowdown in new domestic subscriptions for flagship streaming service Disney+ after entering into the political battle. Several polarizing movies have meanwhile languished in the box office: “Strange World,” an animated film featuring a homosexual teenage romance, fizzled at the box office during what should have been a strong holiday weekend opening, while “Lightyear,” the latest installment in the popular “Toy Story” franchise, featured a homosexual kiss and likewise struggled among moviegoers.
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