Janice R. Andrews
Significantly, Paramount Global stated that it will be laying off around 2,000 workers, or 15% of its U.S. workforce. This choice is a part of a larger plan in anticipation of its impending merger with Skydance Media, which is expected to be completed by September 30, 2025.
CFO Naveen Chopra disclosed on Paramount’s Q2 earnings call that a restructuring charge of $300 million to $400 million is anticipated in the third quarter as a result of the layoffs. The statement came after it was revealed that Paramount had suffered a significant operational loss of $5.98 billion due to a write-down of the value of its cable TV networks, a decision that was directly related to the company’s upcoming acquisition of Skydance.
The sectors most impacted by the layoffs were described by Chris McCarthy, CEO of Paramount Media Networks and Showtime/MTV Entertainment Studios. The marketing and communications departments will be the main targets of the downsizing, with further “right-sizing” initiatives taking place in the legal, finance, and other corporate departments. By the end of 2024, Paramount intends to have completed these layoffs.
By the end of 2023, the corporation employed 21,900 people globally. This year, there have already been notable layoffs. About 800 jobs were cut by Paramount in February. The company’s senior executives, Brian Robbins, president/CEO of Paramount Pictures and Nickelodeon, and Chris McCarthy, head of CBS, George Cheeks, had earlier declared goals to reduce yearly expenses by $500 million. These plans are in line with the most recent wave of layoffs.
The aim of $2 billion in yearly cost synergies is what Skydance and its consulting partner Bain & Co. have set as part of this cost-cutting strategy. The need for significant cost cuts was underlined by Jeff Shell, who will take over as president of the combined company, especially in Paramount’s “challenged and declining” linear TV division.
As the TV industry continues to change, Shell, a former CEO of NBCUniversal and current chairman of RedBird Sports & Media, pointed out that the conventional TV business model has to be reassessed. The combination of Skydance and Paramount marks a turning point in the company’s evolution as it tries to adjust to the quickly evolving media environment.
The difficulties experienced by established media businesses during a period of industry consolidation and changing consumer tastes are brought to light by Paramount’s restructuring initiatives. The industry will probably feel the effects of these layoffs as Paramount and Skydance strive to reorganize and set themselves up for success in the future.
