Disney World CEO Bob Iger revealed plans Wednesday to lay off 7,000 workers, about 3% of its global workforce of 220,000 as of October.
In his first public financial report since returning to the company in late November, Iger said the layoffs are part of Disney’s efforts to slice a total of $5.5 billion in costs. He did not say where the cuts would occur.
But significant layoffs within Florida’s theme parks division appear unlikely. Executives praised the performance of the theme parks, and Iger stated he was “very, very bullish about our parks. ... Demand on the parks is extraordinary right now.”
Disney has not filed any Florida layoff notices, state records show. Federal law requires companies to give 60 days’ notice of mass layoffs and plant closings.
Spokespeople for the corporate company did not immediately return a request for comment Wednesday evening, and representatives for Walt Disney World deferred to Iger’s remarks.
CFO Christine McCarthy said the labor cuts made up about 30% of the company’s cost-reduction plan. Additional reductions will come in marketing, technology and other expenses.
Iger also introduced a reorganization focused on overhauling the company’s streaming business.
The restructuring will organize Disney into three core business segments: Disney Entertainment, ESPN and Disney Parks, Experiences and Products. Former CEO Bob Chapek, whom Iger appointed during his first tenure as CEO and later replaced, previously reorganized the company in October 2020 to sharpen its focus on streaming.
“Our new structure is aimed at returning greater authority to our creative leaders, and making them accountable for how their content performs financially,” Iger said. “Our former structure severed that link and must be restored.”
The earnings call occurred as the Florida Legislature moved forward with plans for a state overhaul of Disney World’s Reedy Creek Improvement District.
Plans include replacing the district’s five-member board, previously appointed by Disney, with one appointed by the governor and renaming the district to the Central Florida Tourism Oversight District.
Disney executives did not address the Reedy Creek issue during the conference call. It was not brought up in a question and answer session following the financial report.
Overall, Disney earned $23.5 billion in revenue in the quarter ending Dec. 31, an 8% increase from a year earlier. Analysts had expected slightly lower numbers.
Disney’s theme parks division reported over $8.7 billion in revenue in the quarter, an increase of 21% from the $7.2 billion it earned during the same period in 2021.
Disney’s financial report came as Disney World’s full-time frontline workers urge the company to raise its minimum wage from $15 to $18 in ongoing contract negotiations. Union tourism workers have reported struggling to afford basic necessities in recent months as the costs of housing, food and utilities soar.
Iger also signaled Disney is rethinking its pricing system at its theme parks in an apparent departure from recent years. Chapek often received the brunt of criticism for Disney’s increasing prices as the company navigated the COVID-19 pandemic.
“It’s clear that some of our pricing initiatives were alienating to consumers,” Iger said. “I’ve always believed, by the way, that accessibility is a core value of the Disney brand. We were not perceived to be as accessible or as affordable to many segments as we probably should have been.”
Last month, Disney announced it was increasing the number of days tickets are cheapest at Disneyland in California and rescinding its parking fee for guests at Walt Disney World hotels. Disney is listening to guest feedback on these changes, which has been positive so far, Iger said.
The company is also looking at opportunities beyond increasing prices to tweak its reservation and capacity system amid continuing demand, Iger said.
“We could lean into that demand easily by letting more people in and by more aggressively pricing — we don’t think either would be smart, because [if] we let more people in, it’s going to reduce guest experience. That’s certainly not what we want,” he said.
Following the success of the Avatar franchise sequel “Avatar: The Way of Water” released in December, Disney is bringing an “exciting Avatar experience to Disneyland,” Iger said Wednesday, without giving any details.
Disney World’s Avatar-themed land, “Pandora: The World of Avatar” opened in May 2017. Executives did not say if any content from the new film would be added to the area Wednesday, but Iger said he was talking with Parks Division Chairman Josh D’Amaro about where Disney could add more from its franchises to its theme parks.
-------
