Paramount Global recently announced a significant round of layoffs, with the aim of eliminating nearly 2,000 jobs by the end of the year. The company, which includes television networks such as CBS, MTV, Nickelodeon, and Comedy Central, as well as the Paramount Pictures movie studio, plans to reduce its U.S.-based workforce by 15%, resulting in an annual cost savings of $500 million. The layoffs are expected to be completed by the end of September, with employees being notified in three phases over the coming months.
The struggling company has faced challenges in recent years as the cable TV bundle has unraveled, causing a decline in profits from cable programming fees. Paramount’s channels, once dominant in the industry, have become less relevant to younger viewers. The company’s value has continued to decline, prompting controlling shareholder Shari Redstone to seek new ownership. A group led by David Ellison has reached an $8 billion deal to acquire Paramount Global, with plans to assume control in the first half of next year.
Ellison’s proposed takeover of Paramount is a two-step process, beginning with the purchase of the Redstone family’s holding company, National Amusements Inc. This move would mark the family’s exit from the movie business after over 80 years of ownership. The deal with Skydance Media, RedBird Capital Partners, and Larry Ellison’s Oracle Corp. would provide the Redstone family with about $1.7 billion after debt repayment. The $2.4 billion acquisition of National Amusements is a significant step in the change of ownership for Paramount.
As part of the acquisition process, Paramount recently announced a $6 billion write-down on its cable television networks business, highlighting the challenges facing the traditional television industry. The company’s executives, Brian Robbins, Chris McCarthy, and George Cheeks, acknowledged the need for changes to strengthen Paramount’s business in light of industry evolution. The layoffs have been a difficult decision, but the leaders are confident in the direction forward for the company.
Paramount employees have been dealing with corporate uncertainty throughout the year, with changes in leadership and the impending sale process causing anxiety among staff. The new leadership team, installed earlier this year, has signaled deep cost cutting measures as the company continues to face challenges. The layoffs coincide with CBS’s launch of its fall TV schedule and the movie studio’s efforts to maintain its position in a changing industry landscape. Despite the difficult decisions, the executives expressed gratitude for the contributions of departing employees and confidence in the company’s future direction.
