Pixar Animation Studios has announced significant layoffs, cutting approximately 175 employees, or 14% of its workforce. This move comes as part of a broader restructuring effort by Disney to shift focus from streaming content to feature films.
Background and Impact
Pixar employees had been bracing for layoffs since January, but the final cuts were smaller than the anticipated 20% reduction. The layoffs are part of Disney's strategy under CEO Bob Iger to emphasize quality over quantity, moving away from the streaming-centric approach adopted during the pandemic.
During the pandemic, Disney directed several Pixar films, including "Soul," "Luca," and "Turning Red," to its streaming service Disney+, conditioning family audiences to expect these films at home. The transition back to theatrical releases has been challenging, with high-budget films like "Lightyear" and "Onward" underperforming at the box office. Despite "Elemental" earning $495 million globally, this figure is still below Pixar's historical earnings.
The animation studio is now looking to regain its former glory with upcoming releases such as "Inside Out 2," scheduled for June 14, which exhibitors believe will recapture Pixar's renowned charm. Future projects include "Elio" in 2025 and "Toy Story 5" in 2026.
Disney's Broader Strategy
Disney has been undergoing a series of layoffs to cut costs, affecting around 3.6% of its global workforce of approximately 220,000 employees last year. Pixar previously laid off 75 employees in mid-2023 as part of these companywide cutbacks. The recent layoffs reflect Disney's ongoing effort to scale back on direct-to-consumer series in favor of feature films.
Leadership's Message
Jim Morris, Pixar's president, addressed the layoffs in a memo to staff, emphasizing the difficulty of the decision and the support the company will provide to those affected. Morris highlighted the studio's pivot back to focusing on feature films and assured employees of the company's commitment to handling the transition with care and respect.
Hello everyone,
I have spoken to you many times over the last year about our pending move away from series production for Disney+, the return to our focus on feature films, and the reduction in our team that would accompany that. That day is here, and while it is not coming as a surprise to anyone, it is one of the hardest changes we've had to make, as it means we will be parting with a number of talented and dedicated colleagues and friends.
Today, leaders will begin the process of notifying employees whose positions are being impacted. Calendar invites to speak with a leader have already gone out to those individuals, and we anticipate we will have connected with everyone impacted by the end of the day.
I want to assure you that we will be providing extensive support as our colleagues start to transition out of the studio. We are committed to ensuring that their departure is handled with the utmost respect and care at every stage. This is important to me, and I understand how important this is to all of us in the Pixar community. I will host a brief Studio Meeting via Zoom this afternoon at 5:00 to talk more about today's announcement.
Despite the challenges in our industry over the past few years, you have all consistently shown up to contribute, collaborate, innovate, lead, and do great work at this studio. I give you my deepest thanks, and for those who will be leaving us, I am hopeful that our paths will cross again, both professionally and personally.
Jim
Conclusion
The layoffs at Pixar mark a significant shift in the animation studio's strategy as it aims to refocus on its core strength of producing high-quality feature films. Despite the challenges and the ongoing scrutiny, Pixar looks to its upcoming projects to re-establish its position as a leader in the animation industry.
