Paramount Global will cut $500 million in costs by the end of the year, and aims to have the bulk of them complete by the end of September, according to a memo from company management issued Tuesday.
The budget reductions have been in the works for weeks, and Paramount’s top leaders indicated during an investor call last week that the company would take as much as $300 million to $400 million in charges related to layoffs that would predominantly come from its marketing and communications teams. The company expects to eliminate around 2,000 positions. Paramount last week wrote down the value of its cable networks, which include MTV, Nickelodeon and Comedy Central, by nearly $6 billion
“As we continue to advance our plan, we announced on our earnings call last week that we will be reducing our US-based workforce by approximately 15%, focusing on redundant functions and streamlining corporate teams,” said the memo from George Cheeks, Brian Robbins and Chris McCarthy, the co-CEOs who have been running Paramount since it ousted Bob Bakish from the top office. They added: “This process will take place in three phases, starting today and continuing through the end of the year. We expect 90% of these actions to be complete by the end of September.”
Paramount’s controlling shareholder, National Amusements Inc., has agreed to a sale to Skydance Media, which has identified $2 billion in cuts to the media conglomerate. The current $500 million are seen as part of that larger figure.
Paramount is one of several big U.S. media companies struggling with the migration of one-time TV viewers to streaming video. While the company owns the big CBS broadcast network, home to many of its big-audience sports properties, the bulk of the Paramount portfolio is centered around a cluster of cable networks that only show a few original programs and have seen the communities that once clustered around them dissipate over the past decade. Last week, Warner Bros. Discovery wrote down the value of its cable properties by $9.1 billion.
“The industry continues to evolve, and Paramount is at an inflection point where changes must be made to strengthen our business. And while these actions are often difficult, we are confident in our direction forward,” the executives said. “We understand that you may have questions about next steps, and while we may not be able to provide all the answers at this time, we will continue to update you on our progress.