Disney CEO Bob Chapek predicts ‘staff reductions’ among measures to make streaming platform profitable by 2024

Disney is the latest big company that is looking to cut costs ahead of a predicted global pandemic. The news comes hot off the heels of announcements by both Twitter and Meta that they would be cutting staff in order to balance the books in the past week.

In a memo to staff members regarded as “Disney Leaders”, CEO Bob Chapek admits that measures will have to be taken in order to achieve the “important goal” of Disney+, the company’s dedicated streaming platform, reaching profitability by the 2024 financial year. In addition to the measures Chapek outlined in his email, the CEO also announced the creation of a cost structure taskforce, consisting of Chief Financial Officer Christine McCarthy, General Counsel Horacio Gutierrez and Chapek himself.

Some of those measures Chapek outlined includes a hiring freeze, except in the instance of a role that is a “critical, business-driving position,” a review of the company’s content and marketing spending working with content leaders and their teams and a review of SG&A costs, having determined that there is room for improved efficiency - “as well as an opportunity to transform the organisation to be more nimble”.

It’s the last measure that has current Disney employees worried of layoffs akin to the aforementioned social media platforms. Within Chapek’s email, he states: “We will look at every avenue of operations and labour to find savings, and we do anticipate some staff reductions as part of this review.”

Chapek ends his message by assuring Disney Leaders he is“fully aware this will be a difficult process for many of you and your teams”. Finishing with: “We are going to have to make tough and uncomfortable decisions. But that is just what leadership requires, and I thank you in advance for stepping up during this important time.

“Our company has weathered many challenges during our 100-year history, and I have no doubt we will achieve our goals and create a more nimble company better suited to the environment of tomorrow.”

The full email sent to employees by Disney CEO Bob Chapek

“Disney Leaders

As we begin fiscal 2023, I want to communicate with you directly about the cost management efforts Christine McCarthy and I referenced on this week’s earnings call. These efforts will help us to both achieve the important goal of reaching profitability for Disney+ in fiscal 2024 and make us a more efficient and nimble company overall. This work is occurring against a backdrop of economic uncertainty that all companies and our industry are contending with.