15% of U.S. Employees to Be Laid Off, According to Paramount's Latest Memo

Paramount Television Studios announced a significant downsizing on Tuesday, revealing plans to lay off 15% of its U.S.-based workforce in the coming months. This move, coupled with the shutdown of one of its television studios, highlights the ongoing challenges facing the entertainment industry.

In a memo addressed to staff, Paramount co-CEOs George Cheeks, Brian Robbins, and Chris McCarthy explained the rationale behind these drastic measures. “A short time ago, we informed the team at Paramount Television Studios (PTVS) that the studio will cease operations at the end of the week,” the executives wrote. They emphasized that the decision was not a reflection of PTVS's performance but was driven by significant shifts in the TV and streaming marketplace that necessitate a leaner operation.

The studio in question, which is responsible for producing popular shows like “Reacher” for Amazon Prime Video and “13 Reasons Why” for Netflix, will officially close its doors by the end of this week. Paramount’s decision underscores the broader struggles within the industry, as traditional media companies continue to grapple with the rise of streaming services and changing consumer habits.

According to Deadline, Paramount employed around 21,900 full- and part-time staff members globally at the end of 2023, with an additional 4,500 project-based employees. The planned layoffs, which are expected to be largely completed by the end of September, will reduce the company's workforce by approximately 3,000 employees, contributing to an estimated $500 million in savings.

“The industry continues to evolve, and Paramount is at an inflection point where changes must be made to strengthen our business,” the executive team stated. While acknowledging the difficulty of these decisions, they expressed confidence in the company’s future direction.

This latest development comes as Paramount faces mounting financial pressures, leading to controlling shareholder Shari Redstone's decision to sell the company her family has overseen for over 35 years. A merger plan spearheaded by Skydance Media, led by David Ellison, is set to take over Paramount, with an $8 billion investment from key players including RedBird Capital and billionaire Larry Ellison.

Regulatory approval for the merger is expected later this month, barring any new potential buyers stepping in.

As the entertainment landscape continues to shift, Paramount’s dramatic restructuring signals the intense challenges traditional studios face in adapting to a rapidly changing market.

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