Status: 02/09/2023 00:53
Despite billions in profits, the US entertainment group Disney is laying off around 7,000 employees in view of the global economic crisis. In addition, the group is to be restructured.
Despite good business in the past quarter, the entertainment giant Walt Disney is planning significant cuts in personnel. About 7,000 jobs — about 3 percent of the global workforce — are to be cut as part of a program aimed at reducing annual costs by $5.5 billion. This was announced by Disney boss Bob Iger.
“This decision was not taken lightly,” said Iger. In view of “global economic challenges”, he announced a major restructuring of the group. Investors allowed the share to rise by around eight percent in after-hours trading.
profit increased significantly
Disney recently earned better than expected: In the three months to the end of December, profits increased by eleven percent year-on-year to $ 1.3 billion (1.2 billion euros). Revenue grew eight percent to $23.5 billion. Disney exceeded the forecasts of Wall Street experts.
However, the group lost subscribers to its most important streaming service Disney + for the first time since it was founded after significant price increases. At the end of the quarter, the video service that competes with Netflix had 161.8 million users worldwide – a good one percent fewer than three months earlier.
Disney’s other streaming services, Hulu and ESPN+, posted modest gains. In addition, the division’s loss of $1.1 billion was lower than feared. In the previous quarter, the minus was $ 1.5 billion.
With the layoffs now announced, the entertainment giant joins similar decisions by other big tech companies. The background is almost everywhere the drop in demand due to the crisis. In addition, many tech companies hired massive numbers of people during the corona pandemic – this development is now being reversed.