After declining Skydance’s merger proposal two weeks ago, Paramount Global’s new co-CEO team of Brian Robbins, George Cheeks, and Chris McCarthy addressed around 500 employees at a town hall on the studio’s Melrose Lot. Cheeks mentioned that bankers have been hired to explore the sale of certain Paramount-owned assets to help achieve a goal of half a billion in cost savings, while employee layoffs are on the horizon.
Chris McCarthy, candid in his remarks, noted that “Let me be clear… a 61% decline in profits is simply unacceptable,”
and emphasized the necessity for immediate action to reverse this trend.
The town hall focused on transforming Paramount’s cost structure, indicating initiatives already underway across corporate functions like legal and marketing. Revenue had increased by 13% between 2018 and 2023, but OIBDA plunged by 61% during the same period.
Challenges Amid Merger Speculations
The meeting was initially scheduled three weeks ago but postponed when the company considered an offer from David Ellison’s Skydance. Robbins acknowledged the turbulence caused by ongoing M&A speculation: “We know what a difficult and disruptive period it has been… we are here today to lay out a go-forward plan that can set us up for success no matter what path the company chooses to go down.”
BETS Sale in Consideration
Cheeks highlighted that the conglomerate has concrete plans to offload certain assets, including BET, which has been operating mostly independently from Paramount Global. Details were shared about prospective partners aimed at enhancing Paramount+ profitability internationally, with potential models for U.S. operations.
The A Quiet Place: Day One Release
This Friday, Paramount will release A Quiet Place: Day One, the third installment in their renowned series. The world premiere recently took place in New York City, drawing considerable attention.
Financial Outlook and Future Steps
The studio has also made public its plans for price hikes on its streaming service Paramount+, effective later this summer. The Showtime plan increases to $12.99/month while the less expensive tier goes up to $7.99/month. This strategic move underscores their efforts to counter linear declines with bolstered digital revenue streams.
Reflecting on past leadership, former CEO Bob Bakish was acknowledged for his contributions during this critical phase for Paramount.
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