Paramount Global is cutting around 25% of its US-based team across Showtime/MTV Entertainment Studios and Paramount Media Networks, following its disappointing Q1 financial results.
Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks, has informed staff in a memo that around a quarter would be cut “through the elimination of some units and by streamlining others.”
McCarthy said that the layoffs would allow Paramount to “reduce costs and create a more effective approach to our business as we move forward.”
As part of the cuts, MTV News, the news production division of MTV which launched in the 1980s, is to be shut down.
Senior execs departing include Jessica Zalkind, SVP of talent and series development, MTV Networks, and Todd Radnitz, SVP of original unscripted series at MTV Entertainment Group and Paramount+, according to US reports.
It also follows Paramount’s Q1 financial report last week, in which the media giant posted a $1.12bn revenue decline, with streaming losses climbing to $511m, leading to a share price drop of more than 28%.
Paramount’s valuation has slumped over the past year, with shares now standing at $16.50, down from $28 a year ago and almost $40 in May 2021.
The company’s DTC revenue, coming in from services such as Tulsa King streamer Paramount+, as well as Pluto TV and Dexter: New Blood and Your Honor service Showtime, has however risen 39% year on year, with subscriptions generating $1.11bn.
In the memo, McCarthy said that “despite this success in streaming, we continue to feel pressure from broader economic headwinds like many of our peers.” As a result, he said that the company had been working to “determine the optimal organisation for the current and future needs of our business.”
He continued: “I realise these decisions will be very hard for everyone, most of all, those who will be leaving. It’s not something we take lightly.”