JAKARTA - Disney CEO Bob Chapek predicts there will be "some staff cuts" after the company reviews its spending. This is known, according to leaked memos published by CNBC. The company is also reportedly going to freeze most of the recruitment, and only bring new employees to "the most critical position of business drive".
If Disney ends up cutting off employment, it won't be the only streaming service company to do that. Dozens of workers have also lost their jobs at Warner Bros Television and HBO Max this year.
Netflix has also laid off hundreds of employees this year while reporting slower customer growth but noted during its latest earnings announcement that its business remains profitable, unlike its premium streaming competitors, including Disney.
Chapek estimates that the service will only benefit by the end of 2024.
So far, there are no details about how many workers may be affected by layoffs, as Disney will start by forming a "cost structure task force" to check its finances.
However, the prospect of layoffs overshadowed following its earnings announcement on Tuesday, November 8 when Disney's CFO, Christine McCarthy, said Disney was "actively evaluating the company's current cost base, and we are looking for meaningful efficiency."
The company also tightened its belts in other ways, during a Chapek memo that notified employees to conduct virtual business meetings if they could to reduce travel costs.
Disney added millions of subscribers to its streaming services such as Disney Plus, ESPN Plus, and Hulu in the last quarter of this year. However, even after raising prices and encouraging many people to opt for more expensive entertainment service packages, their direct-to-consumer businesses are still at a loss for spending millions of dollars on content that will keep customers coming.
Beyond entertainment, the world of technology has seen some brutal cuts: Meta and Twitter have laid off thousands of people in the past week alone. Meanwhile, Amazon has frozen the recruitment of company employees. Over the past few months, Snap, Microsoft, and several crypto companies have also reduced their ratings.
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