Paramount lays off 1,000 workers in first round of cuts
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- Paramount began laying off 1,000 workers this week with another 1,000 planned later as its new owners pursue $2 billion in expense cuts across the company.
- Cuts will affect CBS, CBS News, Comedy Central and other divisions, including the historic Melrose Avenue film studio.
- L.A.’s motion picture employment has plunged 27% since 2022 as studios face streaming saturation and social media competition.
Paramount on Wednesday began cutting about 1,000 employees, the first wave of a deep staff reduction planned since David Ellison took the helm of the entertainment company in August.
Ellison announced the layoffs in an early morning email to his staff, saying the long-anticipated move was aimed at “building a strong foundation for the future.” Wednesday’s cuts represent about 5% of the organization.
“Today we begin the difficult process of informing impacted team members across the company,” Ellison wrote. “These decisions are never made lightly, especially given their effect on our colleagues who have made meaningful contributions to the company.”
The layoffs cut across a broad swath of the company and included staff at CBS, cable channels including MTV, BET and Comedy Central, television production as well as the historic Melrose Avenue film studio, according to people familiar with the matter who were not authorized to comment.
Another 1,000 jobs are expected to be cut at a later date, ultimately bringing the total reduction to about 10% of Paramount’s current workforce, sources said.
At CBS News, about 100 people were forced out. The company pulled the plug on two digital newscasts, the unit’s Johannesburg bureau and several correspondents.
The move was expected. Paramount’s new owners — Ellison’s Skydance Media and RedBird Capital Partners — had told investors they planned to eliminate more than $2 billion in expenses, and Wednesday’s workforce reduction was a preliminary step toward that goal.
Larry Ellison helped finance the $8-billion takeover of Paramount, and his largesse would be key in any deal for Warner Bros. Discovery.
The company’s staff had grown to nearly 20,000 people in August, when Skydance Media’s roughly 1,300 workers joined Paramount as part of the $8-billion takeover of the media firm long controlled by the Sumner Redstone family.
“In some areas, we are addressing redundancies that have emerged across the organization,” Ellison wrote. “In others, we are phasing out roles that are no longer aligned with our evolving priorities and the new structure designed to strengthen our focus on growth. Ultimately, these steps are necessary to position Paramount for long-term success.”
CBS News leaders also shuttered its race and culture reporting unit, which was launched after the 2020 Minneapolis police killing of George Floyd, sources said.
Ellison’s Skydance had promised Federal Communications Commission Chairman Brendan Carr, a President Trump appointee, that it would eliminate any diversity, equity and inclusion programs — a condition to win Carr’s approval of its Paramount takeover. At the time, Carr said he “welcome[d] Skydance’s commitment to make significant changes at the once storied CBS broadcast network.”
Around 100 CBS News employees are being let go, including several correspondents.
Longtime CBS News journalist John Dickerson announced earlier this week that he would exit in December.
The co-anchor of “CBS Evening News,” Dickerson has been a familiar network face for more than 15 years, completing tours at “CBS This Morning” and the Sunday public affairs show “Face the Nation.” A streaming program anchored by Dickerson, “CBS Evening News Plus,” was scrapped.
“CBS Saturday Morning” co-hosts Michelle Miller and Dana Jacobson and the show’s executive producer, Brian Applegate, also were let go.
Paramount has been shedding staff for years.
More than 800 people — or about 3.5% of the company’s workforce — were laid off in June, prior to the Ellison family takeover. At the time, Paramount’s management attributed the cuts to the decline of cable television subscriptions and an increased emphasis on bulking up its streaming TV business. In 2024, the company eliminated 2,000 positions, or 15% of its staff.
The Wall Street Journal reported Thursday that the Ellison-backed Paramount was preparing a largely cash bid for Warner Bros., which owns CNN, HBO and the fabled movie and TV studio.
The cost-cutting comes as Ellison, 42, ramps up spending in other areas, including agreeing to pay $7.7 billion for rights to UFC fights and $1.25 billion over five years to Matt Stone and Trey Parker to continue creating their “South Park” cartoon. He and his team also lured Matt and Ross Duffer, the duo behind “Stranger Things,” away from Netflix and paid $150 million to buy the Free Press and bring its co-founder, Bari Weiss, to the company as CBS News editor in chief.
The company also signed a 10-year lease on a film and television production facility under construction in New Jersey, a move that will give the entertainment company access to that state’s tax incentive program.
Separately, Ellison has launched a high-stakes bidding war for Warner Bros. Discovery, which owns CNN, HBO, TBS, TLC, the Food Network and the Warner Bros. studio. Backed by Ellison’s father, tech billionaire Larry Ellison, Paramount has most recently bid $58 billion for all of Warner Bros. Discovery.
In a blow to Paramount, the prolific creator behind the “Yellowstone” franchise, Taylor Sheridan, made a deal to eventually develop movies and shows for NBCUniversal. Most of the top MTV Network executives who had worked with Sheridan departed Paramount shortly after the merger.
The Paramount layoffs are the latest sign of contraction across the entertainment and tech sectors.
Walt Disney Co. on Tuesday laid off about 100 workers from various teams tied to the Disneyland Resort in Anaheim.
Amazon said this week it was eliminating roughly 14,000 corporate jobs amid its embrace of artificial intelligence to perform more functions. Last week, Facebook parent company Meta disclosed that it was cutting 600 jobs in its AI division.
Last week, cable and broadband provider Charter Corp., which operates the Spectrum service, eliminated 1,200 management jobs around the country.
Los Angeles’ production economy in particular has been roiled by a falloff in local filming and cost-cutting at major media companies.
As of August, about 112,000 people were employed in the Los Angeles region’s motion picture and sound recording industries — the main category for film and television production. The data do not include everyone who works in the entertainment industry, such as those who work as independent contractors.
That was roughly flat compared with the previous year, and down 27% compared with 2022 levels, when about 154,000 people were employed locally in the industry, according to data from the U.S. Bureau of Labor Statistics.
The industry has struggled to rebound since the 2023 strikes by writers and actors, which accelerated a sharp pullback in studio spending following the era of “peak TV,” when studios dramatically increased the pipeline of shows to build streaming platforms to compete with Netflix.
“You saw a considerable drop-off from the strikes and the aftermath,” said Kevin Klowden, an executive director at Milken Institute Finance. “The question is, at what point do these workers exit the industry entirely?”
Here is what Wall Street and the media industry will be watching for once the deal closes on Aug. 7.
Local film industry officials are expecting a production boost and an increase in work after California bolstered its film and television tax credits.
But Southern California’s bedrock industry is confronting other challenges, including shifting consumer habits and competition from social media platforms like YouTube and TikTok.
“There is a larger concern in terms of the financial health of all the major operations in Hollywood,” Klowden said. “There’s a real concern about that level of competition, and what it means.”
‘The future of AM radio as we know it is coming to an end,’ Morris O’Kelly said after cutbacks at KFI-AM (640) resulted in the cancellation of his evening talk show.
Paramount shares dropped 2% Wednesday to close at $15.88.
Times staff writer Stephen Battaglio contributed to this report.
