Walt Disney Co.’s ESPN is reducing its workforce by about 10% through a combination of layoffs and attrition of employees, including remote workers, according to a person familiar with the matter. The cuts come as ESPN and Disney deal with challenges posed by the coronavirus pandemic which has resulted in lost ad revenue from canceled or delayed sporting events. Disney’s theme parks filmed entertainment and cruise divisions have all suffered this year as the pandemic stymied travel and moviegoing across the world.

ESPN is eliminating about 500 jobs by laying off 300 employees and closing 200 open positions, according to a memo sent to staffers from ESPN President Jimmy Pitaro. Mr. Pitaro said in his memo that the cuts were the result of a reorganization plan focused on digital streaming that predated the pandemic but was accelerated in recent months.

“Prior to the pandemic, we had been deeply engaged in strategizing how best to position ESPN for future success amidst tremendous disruption in how fans consume sports,” Pitaro said in the memo viewed by the Times. “The pandemic’s significant impact on our business clearly accelerated those forward-looking discussions.”

The company, based in Bristol, Conn., did not specify which areas would be affected, but people familiar with the plans who were not authorized to discuss the matter publicly said the cuts would be across different departments. The memo did not specify when the layoffs would take effect but said employees “will be learning about their future” over the next few weeks.

ESPN lost a massive amount of its programming this year as the shutdown related to the coronavirus crisis truncated its lineup of NBA, Major League Baseball, and other sports. The NBA Playoffs were moved into the fall, putting them in competition with other events which cut into their ratings.

Pitaro’s memo noted that the company had already taken cost-cutting steps such as executive and talent salary reductions, furloughs, and budget cuts. At the same time, the lockdowns that have occurred as the country deals with rising COVID-19 infections have driven more consumers to streaming services, speeding up the transition away from traditional television.

Todd Horwitz Chief Strategist BubbaTrading.com
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