ESPN is not affected by this week’s layoffs, but is expected to be included in future cuts, according to a person familiar with the matter, Reuters reported.

Bob Iger said Disney will begin notifying the first group of employees affected by the layoffs within the next four days. A second, larger round of layoffs will take place in April, with the letter stating that “thousands of people will be laid off. The final round of layoffs will begin before the summer.

Disney announced in February that it would cut 7,000 jobs to save $5.5 billion (currently about RMB 37.895 billion) in costs and make its money-losing streaming business profitable. “The hard reality of many colleagues and friends leaving Disney makes it impossible to take it lightly, as they bring their life’s passion to their work at Disney.”

A source confirmed that one of the first areas of layoffs was in TV production and acquisitions, which has already led to the departure of executives.

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Disney CEO Bob Iger said in a statement that the company is undergoing a “major transformation” that management believes will improve the profitability of the company’s streaming business.

Disney is just the latest company to start mass layoffs, particularly at tech companies, with Amazon, Twitter, Microsoft, Meta and Google all laying off thousands of workers in recent months.

Disney reported better-than-expected earnings for the first quarter of fiscal 2023 before announcing mass layoffs. For the quarter, the company’s revenue rose 8% from a year earlier to $23.512 billion, slightly above the $23.4 billion estimated by analysts polled by Refinitiv. Among them, the park, experience, and product business revenue was US$8.74 billion, a year-on-year increase of 21%

In the first quarter of fiscal 2023, the company earned $1.28 billion, compared with net income of $1.1 billion in the same period last year; adjusted EPS was $0.99, which was slightly lower than the $1.06 in the same period last year, but much better than the $0.78 USD expectations.

Disney+ had 161.8 million subscribers at the end of the first quarter, down 1% since October 1, 2022. Disney said Disney+ subscribers declined for the first time, but its profitability improved.

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