Today, 25% of the domestic team at Paramount Global will be let go, according to Chris McCarthy. The reduction follows the incorporation of Showtime into his cable and streaming purview, which will now be divided into two roles.
There are “studios,” which now includes MTV Entertainment Studios and Showtime, and “networks,” which will incorporate nine different teams into a single portfolio group. The latter group is the one who is most affected by the layoffs, with some departments—like MTV News—being completely eliminated. Towards the end of 2022, Paramount Global had 24,500 employees worldwide.
Due to the earlier, more extensive consolidation: McCarthy’s team had integrated nine networks as part of a reorganisation, hence the majority of the layoffs occur on the networks end rather than the studio side. There are several units there that are reportedly being completely shut down, mostly in the operations. The venerable MTV News, which has been cutting back for years, will be one of the victims.
Despite “success” at streaming, McCarthy wrote in a memo to staff members that IndieWire was able to receive that the company still faces “pressure from larger economic headwinds like many of our peers.” Among these, the advertising industry is failing, and there are fewer people watching linear television.
The greater Paramount Global company is coming off a rough first quarter — the publicly traded company missed Wall Street’s financial forecasts, and has already recognized about $1.7 billion in costs from combining Paramount+ and Showtime.
“As a result, we have made the very hard but necessary decision to reduce our domestic team by approximately 25%,” he wrote to employees. “Through the elimination of some units and by streamlining others, we will be able to reduce costs and create a more effective approach to our business as we move forward.”
Read below McCarthy’s note:
As we finalize the integration of SHOWTIME and continue to transform our business for the future, we have set a great foundation for continued success by consolidating our group into two functions:
- Studios – integrating SHOWTIME and MTV Entertainment Studios into one powerful studio team
- Networks – combining nine separate teams into one portfolio group
This combination has resulted in an incredible track record of hits including “Yellowstone,” “1883,” “Tulsa King,” “South Park,” “The Challenge,” “Teen Wolf,” “1923,” “Drag Race,” “Mayor of Kingstown,” “Your Honor,” “George & Tammy” and “Yellowjackets” – which, taken together, drove record subscribers across Paramount+ and Showtime and helped Paramount+ lead the industry in new subscriber growth.
However, despite this success in streaming, we continue to feel pressure from broader economic headwinds like many of our peers. To address this, our senior leaders in coordination with HR have been working together over the past few months to determine the optimal organization for the current and future needs of our business.
As a result, we have made the very hard but necessary decision to reduce our domestic team by approximately 25%. This is a tough yet important strategic realignment of our group. Through the elimination of some units and by streamlining others, we will be able to reduce costs and create a more effective approach to our business as we move forward. Today we will notify employees whose positions are being impacted with leaders communicating the news directly to those teams/or individuals. These meetings will be followed by individual 1:1s with our HR partners.
I realize these decisions will be very hard for everyone, most of all, those who will be leaving. It’s not something we take lightly. We have some of the most passionate and dedicated team members, who bring their full selves to drive our brands and business forward. This is why it’s so difficult to say goodbye to our friends and colleagues. To those impacted, we deeply appreciate the passion and creativity you have brought every day. I want to thank you for your many contributions.
Our leadership team and HR partners are committed to ensuring this process is done with empathy and respect.