Paramount Global has initiated the first wave of layoffs as it looks to reduce its U.S. workforce by 15%, which would translate to the elimination of around 3,000 positions. These layoffs are part of the company’s goal to cut $500 million in costs by the end of the year. 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, along with other departments.
The first of three stages of the staff reductions began on August 13, with 90% of the planned cuts to be completed by the end of September. George Cheeks, Chris McCarthy and Brian Robbins, the three members of the Office of the CEO, laid out details in a memo to employees.
“In June, we laid out our Strategic Plan to return Paramount to profitable growth, which includes streamlining the organization and cutting costs by $500 million on an annualized basis. 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,” the Co-CEOs wrote. “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,” they explained.
Paramount reported having 21,900 full and part-time employees in 33 countries globally at the end of 2023, as well as 4,500 project-based staffers. Last February, the company let go of 3% of employees.
The biggest concession to industry pressures has been to put the company up for sale. Skydance Media is poised to take control of Paramount in a merger to be completed by the first part of 2025. David Ellison’s company made multiple overtures during a seven-month period of negotiations, finally prevailing with a plan to invest $8 billion in a two-step takeover. It will first acquire controlling shareholder National Amusements Inc. before executing a merger with Paramount, with RedBird Capital and Oracle billionaire Larry Ellison among the financial backers.
“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,” said the memo. “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,” they concluded.
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