What the report says
Walt Disney Co. is preparing to cut hundreds of jobs tied to its television operations as it reorganizes, the Wall Street Journal reported. People described as familiar with the plan told the outlet the shakeup will consolidate parts of the business, and top executives are still ironing out the details.
Who and what is affected
Disney, which owns ABC, ESPN and FX, has been paring back under its new chief executive, Josh D'Amaro. After stepping into the role in March, he moved quickly to begin eliminating 1,000 positions across the company.
Management response and context
At the Bloomberg Screentime conference in Los Angeles, Disney President and Chief Creative Officer Dana Walden addressed questions about layoffs. "We're not firing people every six months," she said. "Like all of our similarly situated competitors, and certainly all of our competitors in the tech industry, there is a need to constantly evaluate how you're structured."
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What this means for your portfolio
There is a cost side and a revenue side here. The job reductions aim to streamline operations, while in September Disney said it would raise prices on several US streaming plans, marking the sixth increase in the last six years. The combination tells you management is pressing on both margins and monetization. Keep an eye on whether the TV restructuring and subscription changes translate into steadier profits or more subscriber churn over the next few quarters.
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