Paramount Skydance Prepares for Massive Layoffs Following $2B Cost Savings Plan

Paramount Skydance is reportedly preparing a "kill-list" of employees for layoffs, targeting 2,000-3,000 job cuts across various departments. The company is expecting cost savings of over $2 billion following its merger with Skydance Media. Despite ongoing challenges in the media industry, Paramount's stock has surged 54% YTD. The average price target implies 26.3% downside potential from current levels.

Paramount Skydance, the newly merged media giant, is preparing to initiate a significant round of job cuts, with reports indicating that up to 2,000 to 3,000 positions could be eliminated across various departments. The layoffs are expected to commence in early November, coinciding with the company's Q3 2025 earnings report [1].

The decision to reduce its workforce comes amidst the ongoing challenges faced by the media industry, including declining revenue from traditional cable and broadcast television, and the limited success of its streaming service, Paramount+ [2]. The incoming leadership has signaled a commitment to cost savings, with the target set at $2 billion following the merger with Skydance Media [1].

Despite these financial pressures, Paramount Skydance's stock has shown resilience, surging 54% year-to-date (YTD). Analysts, however, caution that the stock may still have significant downside potential, with the average price target implying a 26.3% drop from current levels [3].

The company's strategic focus on cost-cutting is evident in its recent announcements, such as a major seven-year media rights agreement with the UFC, worth an average of $1.1 billion annually, and a multi-year exclusive theatrical and streaming deal with the Duffers [1]. These deals are part of the company's broader strategy to enhance its content offerings and attract a larger audience.

While the layoffs are expected to be painful, the company aims to complete this restructuring in one go, avoiding frequent layoffs every quarter. Managers are tasked with submitting their lists of dismissals to HR between September and October [1].

The upcoming job cuts underscore the industry's evolving landscape and the necessity for media companies to adapt to changing consumer behaviors and technological advancements. For investors, the focus should remain on the company's ability to navigate these challenges and deliver sustainable growth.

References:
[1] https://www.linkedin.com/news/story/paramount-to-ax-thousands-of-jobs-6517404/
[2] https://deadline.com/2025/08/paramount-job-cuts-2-1236495593/
[3] https://www.linkedin.com/news/story/paramount-to-ax-thousands-of-jobs-6517404/