The Walt Disney Company announced on Wednesday that it will be cutting 7,000 jobs worldwide, becoming the latest major company to announce deep cuts in its global workforce.
Disney CEO Bob Iger made the announcement during Wednesday’s first quarter earnings call.
Approximately, 3% of Disney’s approximately 220,0000 workers it employed as of Oct. 1 will be affected, CNBC reported. That includes 166,000 employees in the U.S. and about 54,000 internationally.
The entertainment and media giant added that it would be cutting $5.5 billion in costs, CNBC reported. That will include $3 billion from content excluding sports, with the remaining $2.5 billion coming from non-content cuts.
“While this is necessary to address the challenges we’re facing today, I do not make this decision lightly,” Iger said during the earnings call. “I have enormous respect and appreciation for the talent and dedication of our employees worldwide, and I’m mindful of the personal impact of these changes.”
Disney also announced that it would now be comprised of three divisions. Disney Entertainment will include most of the company’s streaming and media operations, CNBC reported. An ESPN division will include the sports television network and the ESPN+ streaming service, while the third division will concentrate on parks, experiences and products.
The cuts in the workforce come after Disney announced better-than-expected financial results for the first quarter, CNN reported. The company’s revenues rose 8% to $23.5 billion, which was higher than projected figures of $23.4 billion, according to the cable news network.
“After a solid first quarter, we are embarking on a significant transformation, one that will maximize the potential of our world-class creative teams and our unparalleled brands and franchises,” Iger said during the earnings call. “We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders.”
Disney shares rose 8% in after-hours trading, The Wall Street Journal reported. The stock closed at $111.78, up 0.1% on the day and 29% year-to-date.