Bob Iger Announces 7,000 Layoffs As Disney+ Loses Subscribers
Bob Iger, in his first earnings call since returning to the company, announced Walt Disney Co. will shed 7,000 jobs as part of a broader effort to save $5.5 billion in costs. Disney is facing pressure to control costs and boost profits as it continues to lose money from its key streaming business, which includes Disney+. The Los Angeles Times reports: The company's marquee streaming service Disney+ lost 2.4 million subscribers during the first quarter, bringing its total count to 161.8 million, mainly stemming from declines in its Disney+Hotstar product in India. The service gained subscribers elsewhere, adding 1.4 million subscribers in the U.S. and internationally, not including Hotstar. Overall, Disney's streaming apps -- Disney+, Hulu and ESPN+ -- have 235 million subscribers. Disney's streaming business continued to bleed cash, losing more than $1 billion during the three months that ended in December. Nonetheless, Disney reported earnings and revenues that beat Wall Street estimates. The company generated sales of $23.5 billion, up 8% from the same quarter a year ago. Analysts on average had been expecting $23.4 billion in revenue. Disney's profit was $1.28 billion, up 11%. The Burbank entertainment giant's earnings of 99 cents a share exceeded projections of 78 cents. "After a solid first quarter, we are embarking on a significant transformation, one that will maximize the potential of our world-class creative teams and our unparalleled brands and franchises," Iger said in a statement. "We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders." Last November, Disney reappointed Iger as CEO after Iger's hand-picked successor as CEO, Bob Chapek, came under fire for his management of the entertainment giant.
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