Paramount initiates layoffs to cut 15% of U.S. workforce

Paramount Global has launched the next phase of its plan to lay off 15% of its U.S. workforce, saying the cuts will be 90% complete today following further cuts.

George Cheeks, Chris McCarthy and Brian Robbins broke the news to employees in a memo this morning. (Read it in full below.) The co-CEOs said months ago they were targeting $500 million in annual cost savings, with layoffs a key component in achieving that goal.

Sources have told Deadline in recent days that the streaming organization within Paramount, which spans multiple divisions, is expected to be the most affected by Phase 2. The company’s advertising department was hit by several cuts last week. During the year, a number of high-profile executives left the company and Paramount Television closed and its shows moved to CBS Studios.

“Like the entire media industry, we are working to increase the profitability of streaming while adapting to the evolving landscape in our traditional businesses. “To prepare Paramount for continued success, we are taking these actions,” the memo said. “Days like this are never easy. It is difficult for us to say goodbye to valued colleagues, and to those who are leaving us, we are incredibly grateful for their countless contributions.”

The IBEW, the largest union representing CBS employees, opposed CBS Broadcasting’s headcount cuts in New York, Los Angeles and Washington, DC. “IBEW members have been producing CBS shows since before television was invented,” said Robert Prunn , the union’s director of broadcasting and telecommunications, “and these layoffs are a hard pill to swallow.”

Paramount employed 21,900 full- and part-time employees in 33 countries and 4,500 project-related employees worldwide at the end of 2023. Last February, the company laid off 3% of employees. A total of at least 2,000 additional employees are expected to leave in the current rounds. There are no exact numbers available for today’s round, but it is believed that several hundred workers will be affected.

The workforce cuts come amid a series of daunting financial challenges facing Paramount and other legacy media companies, particularly due to declining viewership and advertising on linear television. When Paramount reported its second-quarter financial results last month, it also disclosed a $6 billion writedown on the value of its cable network assets. As cash flow from traditional pay-TV sources declines, the cost profile of the streaming business and ever-increasing fees for elite sports rights only add to the concerns of companies burdened with significant debt.

As Paramount has tightened its belt over the past year, it has also sought to sell certain assets as well as the entire company. Skydance Media finalized a merger deal last month that would see it invest $8 billion to acquire controlling shareholder National Amusements before fully merging with Paramount.

Here is the full memo from the co-CEOs:

Hello everyone,

We are following the note below to inform you that we will begin the second phase of our U.S. workforce reductions today.

Like the entire media industry, we are working to increase the profitability of streaming while adapting to the evolving landscape in our traditional businesses. To continue making Paramount successful, we are taking these actions, and after today, 90% of these reductions will be complete.

Days like this are never easy. It is difficult for us to say goodbye to valued colleagues, and to those who are leaving us, we are incredibly grateful for your countless contributions.

We appreciate everyone’s resilience and commitment to delivering some of the biggest TV and film hits and continuing the hard but necessary work to best position the company for the future.

Thank you very much,
George, Chris & Brian