Time Warner Cuts 1,475 Jobs to Downsize Turner Broadcasting
Time Warner Inc. (TWX) will be trimming nearly a tenth of workforce (1,475 employees) at the Turner Broadcasting Division. The reduction is likely to include the earlier announced buyout offer for 500—600 senior employees.
Elimination will span across 18 worldwide locations and at all levels ranging from news, entertainment, sports to corporate jobs. Turner, at present has a strong workforce of 14,000 employees with 5,500 positions at its headquarters in Atlanta. The development comes on the heels of the estimated $24 billion multi-year deal with NBA that Turner, along with The Walt Disney Company’s (DIS) ESPN, signed a couple of days back.
After thwarting an $80 billion bid by Rupert Murdoch, CEO of Twenty-First Century Fox, Inc. (FOXA), Time Warner has taken restructuring aggressively. As per an internal memo, Time Warner, which is confident of performing, better as a standalone company, will be focusing on reducing costs and increasing investments in key areas to enhance profitability.
Turner Broadcasting Division will be given a major facelift as falling ratings, unfavorable advertising trends and stiff competition from other media stalwarts including Disney, 21st Century Fox and CBS Corporation (CBS) have heavily weighed on its revenues. All these efforts are part of Time Warner’s broader streamlining initiative Turner 2020, announced in Jun 2014.
Under this plan, the company aims at revamping the struggling segment into a competent one with more focus on original programming and content monetization.
Turner, which houses cable channels like CNN, TNT and TBS, accounts for Time Warner’s sizeable profits and revenues. It is now extremely important for Time Warner, especially after thwarting Murdoch’s eye popping deal, to successfully execute its strategies to retain investor confidence in the stock.
At present, Time Warner is a Zacks Rank # 3 (Hold) stock.
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