David Ellison warned employees that layoffs are coming after the completion of Skydance’s blockbuster merger with Warner Bros. Discovery.
Paramount and Warner Bros. Discovery officially completed their roughly $110 billion merger on Oct. 6, which created Skydance Corp. Ellison serves as chairman and CEO and former Mattel chief Ynon Kreiz joined as co-CEO.
David Ellison Says Layoffs Are Coming
In a memo to employees after the deal closed, Ellison and Kreiz acknowledged that integrating the two companies will result in workforce reductions. The executives said the integration would involve “difficult decisions that affect our workforce,” while promising that the process would be handled thoughtfully and respectfully.
Skydance is looking to extract more than $6 billion in expected cost savings from the merger over the coming years. Reuters reported that Kreiz’s appointment as co-CEO suggests a shift in focus towards operational efficiency, particularly as the combined business takes on around $80 billion in debt.
The size and timing of the layoffs have not yet been publicly disclosed.
However, staff at both Paramount and Warner Bros. Discovery has reportedly been preparing for possible job cuts even before the transaction closed, with overlapping corporate, streaming and operational functions seen as obvious areas where the new company could reduce costs.
Skydance is now one of Hollywood’s biggest media companies, controlling Warner Bros., Paramount Pictures, HBO, HBO Max, Paramount+, CBS and CNN, along with major franchises including Harry Potter, Batman, Mission: Impossible and Star Trek.
Despite the cost-cutting push, Ellison is also planning aggressive investment in content. The company committed to releasing at least 30 theatrical films annually and is expected to spend heavily on film, television and streaming to compete more directly with Netflix, Disney, Amazon and Apple.
That creates a difficult balancing act for Ellison: reducing expenses and managing a huge debt burden while still investing enough to grow Skydance’s entertainment and streaming businesses.
For employees, the immediate question is now how deep the restructuring will go, and which parts of Paramount and Warner Bros. will face the biggest cuts.
