Things aren’t going well on Disney’s side. The entertainment behemoth has announced that it will cut the workforce of the Pixar studio to try to pay off the debts of its platform Disney+.
Twitch, Google, Prime Video and now Pixar. The immense wave of layoffs sweeping the United States does not seem to spare anyone. According to information obtained by TechCrunch and confirmed by the company itself, Pixar will get rid of part of its workforce in a strategic “restructuring” effort.
Disney+ still not profitable
According to sources interviewed by the English-speaking media, the studio could lay off up to 20% of its workforce, but Disney refutes this figure, without offering a more precise number. The forced departure of employees is not planned for immediately, but should take place later in the year, depending on logistical decisions made by the studio.
Behind this mass dismissal are the significant losses that Disney has had to endure in recent fiscal quarters or, more precisely, the losses caused by its Disney+ streaming service. Despite a growing subscription curve (+7 million by the end of 2023), the platform continues to lose money with a net result of -$387 million for the last fiscal quarter. A figure in the red, but already preferable to the 1.5 billion dollars that the sector lost at the end of 2022.
Films struggle to attract audiences
According to Bob Iger, Disney CEO, the curves should return to green at the end of 2024 thanks to restructuring efforts which have enabled “considerable efficiency gains“. Note that, overall, the Walt Disney Corporation displays rather encouraging financial health with a turnover of 21.2 billion and net income standing at 264 million for the last fiscal quarter to date. In July 2023, Reuters specified that Bob Iger received around $27 million per year with the bulk of this sum in equity.
Many of the workers affected by this effort to “restructuring» had been hired specifically to produce content for Disney+. Unfortunately, the titles published on the platform have not grossed as much as expected and it seems that the company is having difficulty convincing the public to return to the cinema after the Covid years which saw many films arriving directly on the various platforms streaming.
Source : TechCrunch
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