The media and entertainment industry’s reckoning will continue in 2024 with more layoffs as rising costs and debt-ridden balance sheets continue to weigh on the embattled sector.
Partly in an attempt to appease Wall Street, these companies over the past year have slashed billions of dollars’ worth of costs. In addition, under profit pressuere, they rolled out ad-supported tiers, bundled their offerings, and raised the monthly prices of subscription plans.
But all of that wasn’t enough to satisfy investors.
Valuation levels remain depressed. And streaming profitability still has a long way to go, with virtually all media companies (with the exception of Netflix) losing money on that business. The bottom line: more job cuts.
Here’s what top media and entertainment companies have in mind when it comes to layoffs in 2024:
Paramount Global
As M&A rumors swirl about the future of the Paramount Global (PARA), CEO Bob Bakish announced layoffs in an internal memo obtained by Yahoo Finance on Thursday.
The executive cited the need to “operate as a leaner company and spend less.”
“As it has over the past few years, this does mean we will continue to reduce our workforce globally. These decisions are never easy, but are essential on our path to earnings growth,” the memo read.
No specific numbers or timeline was provided. Paramount reports quarterly results on Feb. 28.
Youtube
Not even tech giant Alphabet (GOOG, GOOGL) has been immune to layoffs.
Last week, the company cut 100 YouTube employees from its creator management and operations divisions, a spokesperson confirmed to Yahoo Finance — its first corporate restructuring in a decade. YouTube has 7,173 employees worldwide.
According to an internal memo viewed by Yahoo Finance, the cuts will effect YouTube’s creator management and operations teams.
The workforce reduction comes after Alphabet slashed thousands of jobs across its engineering, hardware and advertising teams in an effort to reduce headcount.
Meanwhile, Alphabet CEO Sundar Pichai said in a widely cited internal memo that more layoffs were likely needed across the entire company in 2024 in order for the company to reach its goals.
United Music Group
Universal Music Group (UMG), one of the industry’s most prominent record labels, plans to lay off hundreds of employees later this quarter, according to Bloomberg.
The layoffs, part of a broader restructuring, will supposedly be the largest since the company went public in 2021, Bloomberg noted.
While UMG wouldn’t fully confirm the report, a spokesperson hinted at the cuts in a company statement provided to Yahoo Finance: “We are creating efficiencies in other areas of the business so we can remain nimble and responsive to the dynamic market, while realizing the benefits of our scale.”
Pixar
Disney’s (DIS) animation unit will reportedly lay off as much as 20% of its 1,300 workforce, according to TechCrunch. The cuts come as streaming profitability lags while the company’s box office has struggled.
Disney did not immediately respond to Yahoo Finance’s request for confirmation on the report.
Business Insider
The online publication, a subsidiary of German publisher Axel Springer SE, said Thursday it will cut “about 8%” of its staff — a recent trend that’s permeated across major news organizations throughout the country. (See Los Angeles Times next.)
“We closed out last year with a plan in place, a clear target audience, and a vision,” Business Insider CEO Barbara Peng wrote in a memo to staff. “This year is about making it happen and focusing our company and efforts towards this future. Unfortunately, this also means we need to scale back in some areas of our organization.”
The exact number of impacted employees was not immediately clear, but the cuts do represent the second round of layoffs in less than a year.
Los Angeles Times
The Los Angeles Times announced sweeping layoffs on Tuesday that eliminated the jobs of at least 115 staff members, or roughly 20% of its newsroom.
The workforce reduction was the largest in the newspaper’s 142-year history, according to the Times.
The paper’s owner, Dr. Patrick Soon-Shiong, said the cuts were necessary in order to account for the loss of as much as $40 million a year due to a bleak advertising environment.
Sports Illustrated
One of the most storied sports publications laid off most (or possibly all) of its staff last week after its publisher, Arena Group Holds, had its license to operate the publication revoked.
Arena Group failed to make a $3.8 million quarterly licensing payment to Authentic Brands Group, which has owned the magazine since 2019. Authentic Brands Group sold the publishing rights to Arena Group in a ten-year deal that same year.
“This is another difficult day in what has been a difficult four years for Sports Illustrated under Arena Group,” the publication’s union wrote in a statement following the news.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on Twitter @allie_canal, LinkedIn, and email her at [email protected].
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