Paramount began significant layoffs Wednesday morning, with about 1,000 U.S.-based workers being let go in the first round, and roughly another 1,000 soon to follow.
The 2,000 layoffs represent about 10% of Paramount’s employee base.
CEO David Ellison confirmed the cuts were underway in a memo to employees. (Read it in full below.)
“When we launched the new Paramount in August, we made clear that building a strong, future-focused company would require significant change – including restructuring the organization,” he wrote.
The memo continued, “We want to be as open and direct as possible about the reasons behind these changes. In some areas, we are addressing redundancies that have emerged across the organization. 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.”
The long-expected cuts come nearly three months after the close of the $8.4 billion merger of Paramount and Skydance. Executives at the merged company have promised Wall Street they would deliver $2 billion in cost savings, with part of that target amount being achieved by workforce reductions. The company is also looking to trim its real estate portfolio and unload some businesses. It sold Argentinian broadcast network Telefé last week in a deal reportedly worth $100 million, a fraction of the $345 million paid by predecessor company Viacom in 2016.
Along with the belt-tightening, the company has made a number of splashy deals, locking up exclusive rights to the UFC for $7.7 billion. The $1.5 billion re-upping of South Park creators Trey Parker and Matt Stone happened two weeks before the official merger close but with the go-ahead from Ellison & Co.
The previous regime at Paramount had already shrunk the company’s workforce pretty significantly, initiating three waves of layoffs in the latter months of 2024 and reducing the rolls by about 15% in the U.S. As of the end of 2024, total global headcount was 18,600, but Skydance added about 1,300 workers to the mix via the merger.
Layoffs are never an easy part of a post-merger integration process in terms of employee morale, but for Ellison and his management team there is also the matter of the company’s next M&A conquest. The ink had barely dried on the long-gestating Paramount-Skydance merger before Ellison offered (not once, but three times) to acquire rival Warner Bros. Discovery. Last week, word emerged that those overtures had been rebuffed, but Ellison is expected to maintain his pursuit, and WBD initiated a review of its strategic alternatives. Its goal is to convene an auction, citing “unsolicited interest” in a potential acquisition from “multiple parties,” with Comcast and Amazon atop the list of those believed to be kicking the tires.
Paramount is hardly the only U.S. company in streamlining mode. This week alone, Amazon, Target and United Parcel Service have announced tens of thousands of layoffs, joining major employers like Booz Allen Hamilton and General Motors. Many companies have embraced AI, seeing it as a more efficient way to perform tasks previously handled by white-collar office workers.
Here is Ellison’s full memo:
Dear All,
When we launched the new Paramount in August, we made clear that building a strong, future-focused company would require significant change – including restructuring the organization. As part of that process, we must also reduce the size of our workforce, and we recognize these actions affect our most important asset: our people.
We want to be as open and direct as possible about the reasons behind these changes. In some areas, we are addressing redundancies that have emerged across the organization. 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.
That said, today we begin the difficult process of informing impacted team members across the company. These decisions are never made lightly, especially given their effect on our colleagues who have made meaningful contributions to the company. To this end, we are committed to supporting all employees through this transition. Members of our HR team will be working closely with business unit leaders to share detailed information on benefits and transition services. Additional questions can be directed to [HR email].
We are deeply grateful for your hard work, professionalism, and resilience during this period of transition. We remain confident that Paramount’s best days are ahead, and we’re committed to building a strong foundation for the future.
Thank you,David
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