Bob Iger, the CEO of Disney, has confirmed that the company will be starting its first round of layoffs this week, with the aim of reducing its workforce by approximately 7,000 employees.

In the following weeks, supervisors have been completing the particulars of the fresh framework. Iger initially disclosed intentions for the reduction in size in February, characterizing it as a crucial element in attaining $5.5 billion in expense reductions. The preliminary round for this week arrives a couple of days prior to the corporation’s yearly gathering with shareholders on April 3. The executive’s memorandum to staff (read it beneath) closely aligns with the information exclusively reported by Deadline last week – three sets of reductions, with the second anticipated to be the most substantial.

Iger wrote in the memo, “In order to ensure that Disney can continue delivering exceptional entertainment to guests and audiences around the world, we must always do what is required, even in challenging times, to secure the future.”

Deadline informed sources that there will likely be significant reductions in staff and resources at Hulu, as well as its sister studios ABC Signature and 20th Television, within the Entertainment division. It is expected that all three divisions – Parks, Experiences and Products; Entertainment; and ESPN – will be affected by the layoffs. After dismantling the centralized distribution structure established by former CEOBob. Chapek, Iger created three separate corporate divisions. As he takes on the role of leading the media giant for the second time, he faces numerous challenges, including a more challenging macroeconomic climate and increased skepticism from Wall Street regarding the financial viability of streaming. After a 14-year tenure as CEO, Iger stepped down in 2020 but returned to the top position in November.

The outlook for general-entertainment streaming regarding the recent negative comments made by Iger about a potential departure seems less than optimistic. Disney could potentially decide to unload its streaming operation, and it is possible that by 2024, Disney may buy out Comcast’s 33% financial stake. The CEO has indicated that although Disney does not fully own Hulu, it operates the platform and has considered all possible scenarios. While it is unlikely that ESPN will offer a standalone streaming version in the near future, Iger has maintained that it will likely remain within the corporate structure. As the company evaluates various strategic options, restructuring is being considered.

In the past few months, Disney’s stock has mostly been moving sideways, but it surged after Iger’s return. Disney’s shares have been heavily impacted, losing about half of their value since summer 2021, along with many other media stocks over the past year or so. At least in the short term, reducing staff could be a positive factor for Disney’s stock.

Here is the complete memo from Iger:.

Dear Colleagues,

I have been closely working with senior leaders in HR to assess your operational needs and provide you with efforts to update. As part of a strategic realignment of our company, we have made the difficult decision to reduce our overall workforce by approximately 7,000 jobs. This includes necessary cost-saving measures to create a more streamlined and coordinated approach to our business. I shared this decision with you in February.

We anticipate that the final round of notifications will begin before the start of summer, with a target of reaching 7,000 job reductions. In April, we expect a larger second round of notifications, which will impact several thousand more staff members. Over the next four days, leaders will directly communicate the news to the first group of affected employees. This week, we will start notifying employees whose positions are impacted by the company’s workforce reductions.

I want to offer my sincere appreciation and thanks to every departing employee for their numerous contributions and devotion to the company. Saying goodbye to such wonderful people is not only difficult, but it also makes us realize the special part of working at Disney. This company is a home to the most dedicated and talented employees in the world, bringing you a lifelong passion for Disney through your work. Leaving Disney is not something we take lightly, and it is a difficult reality for many friends and colleagues.

Going forward, I kindly request your ongoing comprehension and cooperation during this period as we persist in constructing the frameworks and operations that will facilitate our success. I would like to recognize that undoubtedly, there will be obstacles in the future for our unaffected staff members.

Our HR partners and leaders are working diligently to establish a supportive and seamless process at every stage. This commitment will enable Disney to consistently provide outstanding entertainment to its audiences and guests, ensuring that we always rise to the occasion during challenging times.

I want to convey my appreciation to all of you once more for your many achievements while working at The Walt Disney Company.