The wave of layoffs has reached the next US company. Disney is also making cuts. The Mickey Mouse company wants to save 5.5 billion US dollars. The in-house streaming service Disney Plus is also losing subscribers for the first time.
On Wednesday, 8 February 2023, Disney presented its latest quarterly figures. However, although the figures show a significant plus, the company wants to make cuts and eliminate around 7,000 jobs.
Disney’s quarterly figures at a glance
The first quarter of the 2023 financial year ended for Disney on 31 December 2022. The group closed the quarter with a turnover of 23.51 billion US dollars – an increase of eight percent compared to the previous year.
Despite the good figures, however, not everything will continue as before at the entertainment giant. CEO Bob Iger confirmed this when announcing the results: “After a solid first quarter, we are embarking on a significant transformation that will maximise the potential of our world-class creative teams and our unparalleled brands and franchises.”
Going forward, Iger wants to put a renewed focus on creativity at Disney. At the same time, he wants to minimise costs in order to achieve “sustainable growth and profitability for our streaming business”.
He wants to better position the corporation to be better prepared for “future disruption and global economic challenges”.
Disney: Mass layoffs and billions in savings
To achieve these goals, Disney has been working on its structure, among other things. In future, the group will consist of three core business areas:
- Entertainment with all streaming and media activities
- Sports channel ESPN with its streaming service ESPN Plus
- Parks, Experiences and Products
But the restructuring of the company is not the only way to make Disney fit for the future. Iger wants to save a total of 5.5 billion US dollars.
To achieve this, there will also be significant cuts in the workforce. The Mickey Mouse company wants to cut 7,000 jobs, that is 3.2 per cent of the worldwide workforce.
Disney Plus loses subscribers for the first time
It was only in November – shortly after his return to Disney – that CEO Bob Iger announced his intention to focus primarily on profitability in the future with regard to Disney Plus. The growth in subscriber numbers was secondary for the time being.
This is also reflected in the quarterly figures. For the first time, the entertainment company had to report a decline in subscribers.
In the last three months of 2022, the number of subscriptions to Disney Plus fell by 2.4 million. The decline was thus significantly higher than analysts had previously expected.
The declining figures are mainly due to the Disney Plus Hotstar service, which the company offers in India and parts of Southeast Asia. Disney had previously lost the rights to the cricket matches of the Indian Premier League – the streaming service lost 3.8 million subscribers.
In the USA and Canada, Disney Plus was able to increase its subscriptions by around 200,000, but this was not nearly enough to compensate for the enormous loss in India.