Disney Consumer Products Hit With Layoffs
The number receiving pink slips wasn't large but it affected rank-and-file employees up to vp-level executives, a source said.
Ahead of a partial merger with 21st Century Fox and on the heels of a March restructuring, The Walt Disney Co. has handed out pink slips in its consumer products and interactive media segment, The Hollywood Reporter learned on Friday.
Consumer products and interactive media has been a problem child for Disney, posting an 8 percent decline in revenue in the most recent quarter and 10 percent decline in operating income. It was the only segment to report a decline in both metrics.
Disney declined to comment, but one source says the number of layoffs, while not large, did affect rank-and-file employees up to vp-level executives.
Disney is paying more than $71 billion for most of the assets of Fox, a transaction awaiting final regulatory approval, and layoffs were predicted at both Fox and Disney due to redundancies.
Along those lines, Fox said Thursday that Gerson Zweifach, its senior executive vp, group general counsel and chief compliance officer, will step down following the close of the Disney transaction.
But an insider said Friday that this week's layoffs have nothing to do with Fox and are due to a restructuring at Disney, which said six months ago that it would combine its thriving parks and resorts unit with consumer products to create a segment called "parks, experiences and consumer products."
By next year, Disney will be breaking out quarterly revenue and operating income for the new segment, which is run by chairman Bob Chapek.
Disney's restructuring announced in March also created a "direct-to-consumer and international" segment run by chairman Kevin Mayer, and this segment will house a Disney-branded streaming service set for launch next year.