Disney planning to freeze hiring and cut jobs

The Walt Disney Company is planning to freeze hiring and cut some jobs as it strives to move the Disney+ streaming service to profitability against a backdrop of economic uncertainty.

Chief Executive Officer Bob Chapek sent a memo to Disney’s leaders, saying the company was instituting a targetted hiring freeze and anticipated some small staff reductions as it looked to manage costs and make itself more cost-efficient.

The move comes after The Walt Disney Company missed Wall Street estimates for quarterly earnings this week as the entertainment giant racked up more losses from its push into streaming video.

Disney stated that the fast-growing service added 12 million subscribers in its fiscal fourth quarter. However, it reported an operating loss of almost $1.5 billion. The company said Disney+ would eventually become profitable in fiscal 2024, with losses having peaked in the quarter.

Chapek wrote in the memo that the company has already started looking at content and marketing spending and assured that these cuts would not harmfully impact quality. The CEO added that hiring will be limited to a small subset of critical positions.

Shares of the company fell more than 13 percent on Wednesday following its results.