Paramount (NASDAQ:PARA) began laying off employees on Tuesday in response to last week’s announcement that it would reduce its workforce by 15% across all U.S. operations.
In particular, the company is closing its Paramount Television Studios after 11 years of operation and all projects The works currently in the studio will be moved to CBS Studios, according to a memo to studio employees.
“To be clear, this is not a decision based on PTVS’s performance. This move is the result of significant changes in the television and streaming marketplace and the need to streamline our business,” George Cheeks said in a memo to studio employees.
The company has planned its staff reductions in three phases, starting today. 90 percent of the total cuts are expected to be completed by the end of September.
“The industry is evolving 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 about our path forward,” co-CEOs George Cheeks, Chris McCarthy and Brian Robbins said in a separate memo to employees.
The layoffs are expected to provide the company with annual cost savings of $500 million as it tries to minimize the impact of its dwindling cable television business. In its second-quarter report, Paramount reported an impairment charge of nearly $6 billion, joining rivals such as Warner Bros. Discovery, which recorded a writedown of over $9 billion for television stations.
