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Walt Disney fired CEO Bob Chapek, layoffs likely to happen soon

Walt Disney fired CEO Bob Chapek, layoffs likely to happen soon

During an earnings call with investors, finance chief McCarthy said that Disney has plans to aggressively review expenses and cut spending.

Walt Disney fired its head Bob Chapek. Walt Disney fired its head Bob Chapek.
Story highlights
  • Walt Disney plans to cut spending cost aggressively.
  • Disney reported poor quarterly earnings and a big quarterly loss at its streaming business.
  • The company re-appointed Bob Iger to restore profits and help grow the business.

A lot of big tech companies have announced layoffs and taken other cost-saving measures in the past few weeks. It seems that Walt Disney might be next the company to do the same. It has started taking different measures to save costs because Walt Disney has been reporting losses for a long time now.

The company has reportedly sacked its CEO Bob Chapek and re-appointed Bob Iger to restore profits and help grow the business, according to Reuters. Iger headed Walt Disney back in 2005 and during his 15 years of leadership, Disney bought Marvel and Fox's entertainment firms, and other businesses. He also helped launch the Disney+ streaming service, which was later announced in India too as Disney+ Hotstar, in partnership with Star India.

Iger has been hired for only two years, and with his return, the company is expecting to get better results and profits. PP Foresight analyst Paolo Pescatore asserted, "The bold move (Iger's return) might feel like the right one. However, the business is at a different phase of growth," and that some measures will be taken, including "restriction of some operations."

It is being said that the Disney+ streaming service could be one such company which will be most affected. This is because this segment has reportedly faced a loss of over $8 billion in the last three years.

The latest development comes just a few days after Walt Disney announced poor quarterly earnings and a quarterly loss of $1.5 billion at its streaming business. During an earnings call with investors, finance chief McCarthy said that Disney has plans to aggressively review expenses and cut spending, and that "some of those are going to provide some near-term savings and others are going to drive longer-term structural benefits."

WSJ recently reported that Disney+ has internally told managers that layoffs are likely to happen soon. Some austerity measures will be taken, including ban on work travel. The company also reportedly plans to freeze hiring for most departments and it will remain open for only a few critical positions.

The ex-CEO Chapek had reportedly said in the memo that "in the process of reviewing all of Disney's costs, the company will look for every avenue of operations and labor to find savings. We do anticipate some staff reductions as part of this review." At of now, there is no information on how many departments or employees will be impacted by the latest decision.

Published on: Nov 22, 2022, 1:54 PM IST
Posted by: BT Siteadmin, Nov 22, 2022, 1:53 PM IST