Pixar Animation Studios, behind classic films such as "Cars," "Toy Story," and "Finding Nemo," began laying off approximately 14% of its workforce on Tuesday, May 21. These job cuts at the Walt Disney Co unit will impact around 175 employees.
But it's worth noting that the layoffs follow a period of expansion, during which additional staff were hired to create exclusive content for Disney+, driven by former Disney CEO Bob Chapek's directive for increased original programming.
Reuters reported that this move comes as part of a strategic shift to scale back the development of original streaming series. Previous reports also indicated that a first wave of layoffs occurred last year, with additional cuts expected earlier this year.
Disney Original Streaming Content
While the streaming market is highly competitive, with major players like Netflix, Amazon Prime Video, HBO Max, and others vying for subscribers, this competition often leads to increased spending on content and marketing.
Producing original content is expensive. While exclusive shows and movies can attract subscribers, the high production costs can strain profitability.
Current Disney CEO Bob Iger has since reduced spending on original streaming content to boost Disney+'s profitability. The entertainment division, which includes Disney+ and Hulu, reported an operating profit in the most recent quarter.
In the future, Pixar will concentrate solely on feature films, which will premiere in theaters before becoming available on Disney+.
The studio's only original series this year, "Win or Lose," about a co-ed softball team, will debut on Disney+.
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