Woes continued for AMC Networks on Tuesday as the Wall Street Journal reported the media company has planned a large-scale layoff impacting around 20% of U.S. employees. News of the job cuts comes the same day that AMC Networks disclosed an abrupt exit from CEO Christina Spade, who stepped down less than three months since taking on the role.
The WSJ reviewed an earlier memo from AMC Chairman James Dolan to employees saying that the company had believed losses from cord cutting would be offset by streaming gains, but that expectation failed to materialize. Dolan’s memo, per the WSJ, said that “mechanisms for the monetization of content are in disarray.”
AMC did not immediately respond to questions from Fierce.
According to the report, Dolan told employees that AMC executives were directed by the board to implement significant operations cutbacks. The reason for Spade’s departure hasn’t been disclosed, but AMC said she wasn’t terminated for cause and that the board is finalizing efforts to name a replacement.
A media company with its traditional namesake network, AMC has been known for hits like “Breaking Bad,” “The Walking Dead” and “Mad Men.” It also has channels Sundance, IFC and WE. Also this week, the AMC-owned streaming service Acorn TV announced it will shut down in South Africa by the end of the year.
As viewership has shifted to streaming AMC has built its own platforms (including AMC+), as well as licensed content to third parties. However, while it saw third quarter streaming subscribers grow 44% year over year to 11.1 million, net revenue in the latest period was down 16% to $682 million in part due to lower affiliate and advertising revenues.
AMC isn’t the only company that’s had leadership changes and business shakeups recently. Just last week Disney in a surprise move replaced CEO Bob Chapek while reinstating former long-time chief executive Bob Iger to the role. This came after a quarter where Disney recorded nearly $1.5 billion in direct-to-consumer operating losses as it invests heavily in streaming efforts – though executives believe peak DTC losses are now behind it.
Per a CNBC report Monday, Iger has since said the company won’t lift a hiring freeze as it looks to implement organizational and operating changes, and must focus more energy on profitability in streaming rather than simply growing subscriber counts.
Others in the streaming ecosystem have also cut staff as they look to profitability, such as Roku. Earlier this month the streaming device maker disclosed layoffs impacting approximately 200 employees as it looks for ways to curb operating expenses in the face of a challenging economic environment.