Paramount Skydance Cuts 1,000 Jobs in Post-Merger Overhaul
The move is the first major step in a plan to find $2 billion in savings as new chief David Ellison begins reshaping the media giant.
Paramount Skydance Corp. (PSKY) began laying off 1,000 employees this week, the first significant move by new chief executive David Ellison to overhaul the recently merged media company and slash $2 billion in costs.
The cuts, which represent about 5% of the global workforce, are part of a broader restructuring effort expected to impact a total of 2,000 jobs as Mr. Ellison seeks to forge a leaner and more agile competitor in a fiercely contested media landscape. The layoffs were initiated across various divisions of the company formed by the combination of Paramount Global and Skydance Media.
Shares of the company showed a muted reaction, slipping less than 1% to $16.06 in Wednesday's trading session. The modest decline suggests that investors had largely anticipated the aggressive cost-saving measures following the merger's completion. However, the stock has fallen approximately 18% since hitting a two-year high in late September, reflecting broader investor uncertainty about the company's trajectory.
The restructuring is a critical component of the post-merger integration strategy, designed to eliminate redundancies and streamline a complex corporate structure. According to company insiders, the goal is to create a "leaner, faster, smarter" organization better equipped to navigate the challenges of the streaming era and declining traditional television revenue. The company is combining Paramount's extensive library of intellectual property, including franchises like Mission: Impossible and Top Gun, with Skydance's modern production prowess.
Wall Street has remained cautious about the media giant's prospects. The company currently holds a consensus "Strong Sell" rating from analysts, according to data from MarketBeat, who are weighing the potential benefits of the cost-cutting against the formidable challenges of integrating two corporate cultures and revitalizing growth.
Paramount Skydance, like its industry peers Disney, Warner Bros. Discovery, and NBCUniversal, faces immense pressure to make its streaming operations profitable while managing the decline of its linear television networks. The company's streaming platform, Paramount+, is a key focus of the new strategy, with plans to consolidate its offerings and leverage artificial intelligence to improve content discovery and operational efficiency.
The job cuts are the first of several difficult steps Mr. Ellison is expected to take to reshape the storied media empire. While the immediate focus is on achieving the $2 billion savings target, the long-term test will be whether the streamlined operation can consistently produce the global hits needed to compete with streaming titans like Netflix and Amazon Prime Video. Investors will be closely watching for further details on the company's strategic vision, which are expected to be unveiled in the coming months.