Paramount Global will lay off up to 800 staffers in a major cost-cutting effort aimed at returning the business to profitability, as talks continue to swirl that it will sell all or parts of itself.
In a memo to staffers early Tuesday, CEO Bob Bakish wrote that getting back in the black means it must “grow revenue, while reducing costs,” and comes after reductions last year that saw the company combine Paramount+ streaming service with Showtime and cancel a long list of shows.
The cuts affect about 3% of the media conglomerate’s workforce, The New York Times reported.
“Unfortunately, part of streamlining costs means that today, we will begin the difficult process of saying goodbye to some of our very valued colleagues across Paramount,” Bakish wrote in the memo to employees. “We will be notifying impacted employees who are based in the U.S. by the close of business today.”
The news came even as the company celebrated a major win with Sunday’s Super Bowl broadcast, which scored a record 123.4 million viewers across the company’s linear and streaming offerings, including 120 million viewers on CBS, and the return of Jon Stewart to “The Daily Show” on its Comedy Central network Monday night.
The company, also parent of Nickelodeon, MTV, BET and more, is due to report its full-year 2023 results on Feb. 28. Paramount posted a profit in the third quarter on surprisingly strong streaming growth, but Wall Street analysts are expecting the company to post a loss of 5 cents per share for the fourth quarter, according to Zack’s investment research.
Paramount stock lost 49 cents, or 3.6%, to $12.92 in morning trading, after closing Monday down about 40% in the past 52 weeks.
One reason Wall Street is keen on the full year results is that the company appears to be shopping itself. Byron Allen last month offered $14 billion for the entire company, a solid premium on the company’s roughly $9.1 billion market capitalization, which represents the value of all of its trading stock. Bakish last week demurred about Allen’s offer and the possibility of a sale.
The layoffs will impact both US and international offices, Bakish’s memo said, without providing specific details.
“While I realize these changes are in no way easy, as I said last month, I am confident this is the right decision for our future,” he wrote. “These adjustments will help enable us to build on our momentum and execute our strategic vision for the year ahead – and I firmly believe we have much to be excited about.”
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