Pixar set to experience layoffs this year

Pixar, the animation studio owned by Disney, is set to experience layoffs this year. While some company sources suggest the layoffs might be as high as 20% of the staff, Pixar asserts that the actual figures are not yet determined and may be lower.

The reductions in staff will encompass employees hired for Disney+, the company’s streaming division that has not yet turned a profit.

In the last quarter, Disney+ added 7 million new subscribers, surpassing analysts’ expectations with a total of 150.2 million subscribers. Ad-supported customers of the platform also increased by 2 million.

Famous for films such as “Finding Nemo,” “Monsters, Inc.” “WALL-E,” and the “Toy Story” franchise, Pixar is the latest to be affected by Disney’s cost-cutting measures. The cutbacks are due to decreased ad revenue and enduring losses within the Disney+ streaming division.

Disney’s CEO, Bob Iger, expressed during earnings that they anticipate Disney+ to break even by Q4 2024 due to company restructuring.

Pixar’s “Elemental” was a popular title on the streaming platform but had a rocky start with initial poor box office performance. Other notable Pixar films like “Onward,” “Soul,” “Luca”, and “Turning Red” were released directly to Disney+.

Regarding changing audience trends and the shift to streaming, entertainment industry strategist Brandon Katz noted that audiences are now showing signs of fatigue for sequels and franchises.

This year, Pixar plans to release an “Inside Out” sequel and a new film titled “Elio” in 2025.

In 2023, Pixar laid off 75 positions as part of Iger’s plan to reduce the company’s headcount and costs. Disney+ will also incorporate Hulu content in the U.S. this year as part of efforts to boost its streaming business. Disney executives have also been showcasing Disney’s ad tech at the Consumer Electronics Show in Las Vegas.