Disney announced on Wednesday that it planned to reorganize into three segments while cutting thousands of jobs and lowering costs.
The company is made up of three divisions, with details as follows:
1.Disney Entertainment, it is about the streaming and media operation.
2.An ESPN division that included the TV network and the streaming service, ESPN+.
3.A Parks, it is about experiences and product units.
The action was the biggest move that Bob Iger has made since he returned to be the company’s CEO in November. Disney announced the change after it published its latest quarterly earnings report.
On Wednesday, during the quarterly earnings call with investors, Disney announced it would cut $5.5 billion of the costs, and the CEO said about $1 billion had already been cut from the last quarter. It was also added that Disney would lay off 7,000 jobs, or 3% of its nearly 220,000 employees, as of October 1.
Disney’s stocks also ramped up by 5% in off-hours trading.
The reorganization started after Iger returned to be CEO at Disney, replacing the person he had chosen, Bob Chapek. Not too long since Iger has returned, he sent memo announcements to all employees that he would reorganize the business and especially on the media and entertainment unit.
The immediate reorganization means that Kareem Daniel, the company’s previous head of media and entertainment, has to leave.
Iger said he would give the decisions back to the creative team and rationalized the costs at the time. The goal is to have a new structure in the coming months with the remaining composition of DMED.
“Our company is fueled by storytelling and creativity, and virtually every dollar we earn, every transaction, every interaction with our consumers, emanates from something creative,” Iger said Wednesday. “I have always believed that the best way to spur great creativity is to make sure the people who are managing the creative processes feel empowered.”