Paramount Global CEO Bob Bakish announced a new strategic plan focusing the company on its biggest franchises and highlighting “significant” layoffs to come, as the media giant faces pressure to cut costs amid talks of a possible acquisition.
CEO Bakish Warns of ‘Difficult Staffing Decisions’ in Memo to Employees
In an internal memo to staff obtained by multiple media outlets, Bakish warned employees that the company would need to make “some difficult staffing decisions” in order to achieve its goals of rightsizing parts of the business.
While not providing specifics on the number of layoffs, Bakish said the cuts would allow Paramount to “maximize our ability to invest in our biggest priorities.” He pointed to the success of top franchises like “Yellowstone,” “Top Gun: Maverick,” and “Smile” as examples of where the company would focus its resources.
“We have a clear vision for the future – to focus where we will win and to move decisively,” Bakish stated.
Streamlining and Restructuring Part of Broader Strategic Plan
The layoffs are part of a broader strategic plan Bakish laid out focused on four key pillars:
- Focusing investment and operating expenses on franchises and IP with the highest return potential
- Restructuring and integrating certain operations
- Improving execution and extracting more value from assets
- Adding management capabilities
Bakish emphasized the importance of improving earnings growth and margins through these efforts.
“We have an opportunity and obligation to structure and operate differently,” he wrote. Speculation has been growing over the past week that Paramount’s controlling shareholder, National Amusements, could sell all or part of its stake to boost value.
| Key Pillars of Paramount’s Strategic Plan |
|---|
| 1. Focus investment on highest-return franchises and IP |
| 2. Restructure and integrate certain operations |
| 3. Improve execution and extract more asset value |
| 4. Add management capabilities |
Timing of Restructuring Fuels Talk of Impending Skydance Acquisition
The timing of Paramount’s strategic shift has fueled speculation that an acquisition by Skydance Media could be imminent. Skydance, the production company behind franchises like “Mission Impossible” and “Jack Ryan,” is reportedly interested in buying a significant stake in Paramount.
According to sources, negotiations have intensified in recent weeks, with Skydance CEO David Ellison likely eyeing the opportunity to take advantage of Paramount’s currently depressed stock value. An acquisition could give Skydance control over more content while providing Paramount much-needed cash to pay down debt.
Bakish did not comment directly on any specific acquisition talks in the memo. But his expression of urgency around restructuring Paramount’s operations adds credibility to reports that a Skydance deal may soon materialize.
Job Cuts Reflect Industry-Wide Pullback in Media Spending
Paramount’s move to trim staff reflects an industry-wide pullback in spending as media companies brace for an increasingly difficult economic climate. Warner Bros. Discovery, NBCUniversal, AMC Networks, and several streaming platforms have also announced layoffs totaling thousands of jobs in recent months.
At the same time, consumers have been cutting back on discretionary purchases like streaming services and reducing ad budgets have forced the media industry as a whole to become more conservative.
Paramount has a particularly high debt load stemming from its 2019 re-merger with CBS, placing extra pressure on leadership to cut costs. The company is reportedly seeking to reduce spending by as much as $3 billion, both through layoffs and adjustments to content budgets.
What Comes Next: Bakish Presses Focus on Executing New Game Plan
With sweeping layoffs imminent and buyout rumors swirling, Bakish closed his memo urging staff to stay focused on flawless execution.
“The months ahead will require meaningful change, but our direction is clear,” he wrote. “The opportunity ahead of us is even clearer.”
In the near-term, observers will be watching closely for details on the depth and extent of Paramount’s restructuring efforts. If significant layoffs do materialize as hinted, leadership will need to communicate clearly around severance packages and opportunities for affected employees.
Longer-term, analysts say improved earnings growth and margins will be critical benchmarks for measuring the success of Bakish’s new strategic plan. Paying down debt and appeasing National Amusements’ desire for a higher stock value will also factor highly into future moves if Paramount hopes to remain an independent company.
For now, all eyes remain on Paramount and Skydance for any updates on acquisition talks, which could reshape the leadership and direction of the Hollywood icon. One way or another, the memo makes clear Paramount will look very different in the months ahead as it focuses inward on boosting profits.
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