Disney CEO Bob Chapek told division leaders in a letter that the company is implementing cost-cutting measures, in part to help it “achieve the important goal of achieving profitability for Disney+ by fiscal 2024.” Based on the internal memo obtained by: CNBC, Disney plans to limit its workforce expansion through a targeted workforce freeze. It will still welcome new people for the “most critical, business functions”, but all other roles are on hold for now. Chapek also admitted in his letter that Disney “anticipates”[s] workforce reduction”, as it looks at all aspects of its business to find places where it can save money.
Chapek’s letter comes after Disney reported less than excellent results for the previous quarter. While Disney+ welcomed 12.1 million new subscribers for the company’s fourth fiscal quarter ended October 1, its streaming operating loss rose from $0.8 billion to $1.5 billion. The company expects its losses to decline in the future, thanks to the price hikes of its streaming services and the launch of an ad-supported tier on Disney+. In his memo, Chapek also reiterated that he is “confident in” [the company’s] ability to achieve the goals [it has] set”, but Disney clearly intends to tighten its belt until it achieves its goals.
Disney is just one of many companies imposing a workforce freeze due to the economic downturn. When Meta chief Mark Zuckerberg announced that the Facebook parent company is laying off 11,000 employees, he also said it is extending the hiring freeze until the first quarter of 2023. Amazon also froze hiring at its headquarters earlier this month.
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