Disney May Cut Thousands of Jobs as Managers Hunt 20% Savings

Disney managers have been asked to find 20% in annual savings, and thousands of jobs across the company's TV networks and studio may be on the line, sources told Bloomberg on Monday.

The report didn't move the stock. Shares of the Walt Disney Company were flat on Tuesday, and the muted reaction tells you where investors sit: in wait-and-see mode, watching whether the cuts fund growth or simply protect margins.

What exactly is Disney planning?

The cuts would go beyond the small, targeted layoffs Disney has already made across parts of the company this year. Bloomberg reported that the next wave could span divisions, including the TV networks and the studio. Deadline, the Hollywood-focused publication, also reported that Disney was planning more layoffs.

Some of the 20% savings target could come from expense cuts rather than headcount alone, according to the report.

A Disney spokesperson didn't immediately respond to a request for comment from MarketWatch.

The plain takeaway: this is a cost program with an investment plan attached, not a pure retrenchment.

Where does the money go?

CEO Josh D'Amaro plans to reinvest the savings into technology, programming for TV and movies, and the company's theme parks and cruise businesses, according to the Bloomberg report.

That tracks with the vision D'Amaro laid out earlier this year. He promised then to "enhance technology more aggressively and build a more connected consumer experience with Disney+."

It also tracks with what Disney has already said about its cost base. In its last earnings report, the company said it was "midstream" through efforts to cut costs, including labor and selling, general and administrative expenses.

Why didn't the stock react?

Because the numbers around Disney don't scream urgency in either direction. The stock is down 0.5% this year and up just 1.4% over 12 months. It initially got a bump from surprisingly strong fiscal third-quarter earnings, driven by growth in theme-park visitors, the success of "Toy Story 5" and strong ESPN viewership numbers. The bump faded.

Earlier this month, a team of Bernstein analysts led by Laurent Yoon noted that even as Disney appears on track for double-digit earnings-per-share growth through this year and next, the stock is rangebound, sitting at just over 14 times 2027 earnings.

Disney's direct-to-consumer business — streaming and content delivered straight to users — is the "key growth engine" for the company, Yoon and his colleagues said, but it requires "continued investment."

Pointing to reported layoffs involving a few hundred workers in September, the Bernstein team argued the company appears to be trying to fund that investment growth through cost cuts elsewhere.

Their warning was blunt: "And if DIS doesn't invest? Then we suspect the stock remains rangebound, as it has for years, absent a more compelling growth narrative to drive investor confidence."

That's the bet embedded in Tuesday's non-reaction. Investors have seen the cost story. They're waiting to see what D'Amaro buys with the savings.

What happens on Nov. 17?

Disney reports fiscal fourth-quarter results on Nov. 17. The quarter before it was surprisingly strong on parks, "Toy Story 5" and ESPN, and management said cost-cutting was still midstream.

The Nov. 17 report is the first scheduled moment for Disney to quantify the layoff plans — or explain the reinvestment — in front of shareholders. Until then, the market's verdict is already visible in the chart: a stock stuck at roughly 14 times 2027 earnings, waiting for proof that cuts convert into growth.