The Walt Disney Company has announced a major restructuring of internal operations. The company is restructuring into three core business segments: Disney Entertainment, ESPN and Disney Parks, Experiences and Products.
The restructuring aims at increasing accountability, improving results, and returning creativity to the centre of the company.
CEO Bob Iger announced that Alan Bergman and Dana Walden have been named Co-chairmen of Disney Entertainment, which will include the company's full portfolio of entertainment media and content businesses globally, including streaming.
Jimmy Pitaro will continue to serve as Chairman of ESPN, which will include ESPN networks, ESPN+, and their international sports channels. Josh D'Amaro will continue to be Chairman of Disney Parks, Experiences and Products.
"These organisational changes will be implemented immediately and we will begin reporting under the new business structure by the end of the fiscal year," Iger stated.
This marks Disney's third restructuring in five years.
Iger has said that the restructuring would include laying off 7,000 jobs globally, as a part of $5.5 billion in projected cost savings.
"I also shared with the investors today that we are targeting $5.5 billion of cost savings across the company. On the content side, we expect to deliver approximately $3 billion in savings over the next few years, excluding sports. This has come as a result of the new streamlined company structure, as well as from being more curated with our investments in general entertainment and international content and by focusing more on our core brands and franchises," Iger said.
"Decreases to our non-content costs will total roughly $2.5 billion, which will mostly come from reductions in SG&A and other operating costs through the company," he added.
Overall, Disney posted revenue of $23.51 billion (up 8%) and adjusted earnings per share of 99% for the quarter that ended December 31, 2022.
Iger, who stepped down as CEO in 2020 after nearly two decades, was brought back after the company’s Board ousted his replacement, Bob Chapek.
Iger's new stint as CEO is facing major headwinds, including a campaign by activist investor Nelson Petz who is demanding major cost-cutting after he said Disney overpaid to buy the 20th Century Fox movie studio.