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Reuters has a report out that Disney is undergoing a cost-cutting review with an eye toward layoffs at the studio and other units. Factors driving the move include redundancy created by Disney CEO Bob Iger’s string of acquisitions in recent years, and factors such as higher costs in sports acquisition. The near comatose state of home video is also a factor. It’s difficult to assess what the full implications are, but since it is Disney who holds the rights to future John Carter movies, at least until 2015, this is news that should be reported.
Exclusive: Disney looks for cost savings, ponders layoffs – sources
Walt Disney Co started an internal cost-cutting review several weeks ago that may include layoffs at its studio and other units, three people with knowledge of the effort told Reuters, in an early sign that big companies may not be finished tightening their belts.
Disney, whose empire spans TV, film, merchandise and theme parks, is exploring cutbacks in jobs it no longer needs because of improvements in technology, one of the people said.
It is also looking at redundant operations that could be eliminated following a string of major acquisitions over the past few years, said the person.
The people did not want to be identified because Disney has not disclosed the internal review.
After years of repeated and sometimes severe cost cutting in the wake of the financial crisis, by last summer it looked as though Corporate America had trimmed all the fat and was back on the path of profits through operating growth. But news Disney is weighing cuts – on the heels of Eli Lilly and Co’s warning last week that cost controls would drive earnings this year – could herald yet another wave of retrenchment.
Disney executives warned in November that the rising cost of sports rights and moribund home video sales would dampen growth.
“We are constantly looking at eliminating redundancies and creating greater efficiencies, especially with the rapid rise in new technology,” said Disney spokeswoman Zenia Mucha.
In terms of profit margin, Disney’s studio is the least profitable of the entertainment conglomerate’s four major product divisions. The studio had a profit margin of 12.3 percent in 2012.
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John Carter Fan Trailer 1 – by The John Carter Files | 210,000 Views
John Carter Fan Trailer 2 “Heritage” – by the John Carter Files | 150,000 Views
100 Years of John CarterA tribute to the artists who have interpreted John Carter
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