Disney Looks at Possible Layoffs

by Christopher Freeburn | January 7, 2013 11:13 am

Disney 300x227 Disney Looks at Possible Layoffs[1]Disney (NYSE:DIS[2]) may trim expenses by laying off unnecessary employees or freezing new hiring[3].

The iconic media company, which reported record profits last year, is mulling staff cuts at a number of its operating units, including its movie studios, sources told Reuters.

While the company hasn’t said anything about the timing or potential size of layoffs, a Disney spokesperson told Reuters the media giant always looks to increase efficiency and reduce redundancy in its operations and is conducting an internal review of spending. A source told Reuters that a hiring freeze was a possible alternative to staff cuts.

An analyst at Janney Montgomery Scott said Disney was likely to cut personnel at its money-losing interactive game division, as well as at its music and movie units.

Despite last year’s high earnings, Disney executives have noted that lackluster home-video sales and the increased costs of keeping the broadcast rights to big-league sports could mitigate profits.

In October, Disney purchased the rights to George Lucas’ Star Wars franchise for $4 billion and announced plans to produce three new installments[4], with the first hitting theaters in 2015.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/12/Disney.jpg
  2. DIS: http://studio-5.financialcontent.com/investplace/quote?Symbol=DIS
  3. laying off unnecessary employees or freezing new hiring: http://www.reuters.com/article/2013/01/07/us-disney-layoffs-idUSBRE9060AH20130107
  4. announced plans to produce three new installments: http://investorplace.com/2012/10/lucas-sells-star-wars-franchise-to-disney/

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