CNN begins layoffs in what CEO says will be a ‘gut punch’ to the network

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New York
CNN Business
 — 

CNN on Wednesday informed employees that layoffs had commenced, a move that is expected to impact hundreds of staffers at the global news network and mark the deepest cuts to the organization in years.

Chris Licht, who took over as chief executive of the network in May, described the cuts in an all-staff memo as a “gut punch” to the organization and told employees that “it is incredibly hard to say goodbye to any one member of the CNN team, much less many.”

Employees at the company had been anxiously bracing for the layoffs since Licht informed them last month that “unsettling” changes lie ahead.

Licht said that on Wednesday the company would notify a “limited number of individuals,” largely paid contributors, that they have been let go. He said the company “will notify impacted employees” on Thursday. Licht said at the conclusion of the cuts he will “follow up with more details.”

“It will be a difficult time for everyone,” Licht candidly said in his memo.

CNN declined to say on Wednesday how many employees precisely would be impacted by the layoffs.

The layoffs come as media companies are being battered by brutal economic headwinds that have taken a bat to the advertising sector. Licht noted in October, when he signaled large cuts were coming, that there is “widespread concern over the global economic outlook” and that CNN “must factor that risk into [its] long-term planning.”

Other media organizations have also cut costs as they work to best position themselves for the stormy economic climate. Disney

(DIS)
said last week the company needed to restructure, and AMC Networks

(AMCX)
announced Tuesday that it would cut 20% of its staff. Social media companies such as Facebook

(FB)
-parent Meta, which also rely on advertising revenue, have also executed layoffs in recent months.

CNN, which still posts profits in the hundreds of millions of dollars, was spared from the cuts that wreaked havoc on the industry during the pandemic. Prior to this year, the last major cuts to occur at the organization were in 2018 when less than 50 people lost their jobs as the company restructured its digital business.

The cuts to the organization also come after CNN’s former parent company, WarnerMedia, merged earlier this year with Discovery, creating a media juggernaut laced with billions of dollars in debt and a need to slash costs across the board. The merger had just been completed in April when the company announced it was shuttering streaming service CNN+ a month after it was launched

David Zaslav, chief executive of Warner Bros. Discovery, the company that was formed when WarnerMedia and Discovery became one, has promised investors that he will find more than $3 billion in savings in the combined organization.

After Licht took over as head of CNN, he conducted a months-long review of the business. That review led to him identifying changes that should be made, Licht said in October. Some of those changes have already been implemented, as CNN has made smaller cuts to parts of its business in the last several months.

Licht said in his all-staff memo on Wednesday that employees affected by this week’s cuts will be notified “through an in-person meeting or via Zoom, depending on your location.”

“In those meetings, you will receive information specific to you about notice period or any severance that would apply, and your anticipated last day,” Licht said. “I want to be clear that everyone who is bonus eligible will still receive their 2022 bonuses, which are determined by company performance.”

Licht acknowledged that the cuts will “affect both our departing colleagues and those who remain” and promised to provide employees “resources designed to support” them.

“Let’s take care of each other this week,” Licht said.



Source : CNN