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Warner Music Group Corp. is set to terminate 10% of its workforce, translating to 600 employees. The company confirmed the new layoffs on Wednesday, Feb. 7.
According to Bloomberg, Warner Music Group said the money it would save from the reduced workforce would be used for new opportunities. Most of the jobs affected by the cuts will come from the company’s podcast network and websites.
Restructuring Plan for WMG’s Growth
Warner Music is trimming the number of employees to save on costs. In its Securities and Exchange Commission (SEC) filing this week, the New York City-headquartered entertainment and record label explained that the job terminations are part of its broader restructuring plan to have more funds by saving.
The company said it will direct the savings to more investments in its primary music units and latest technologies. WMG believes this plan will help boost and speed up its growth for the next decade. Based on estimations, the job cuts will allow Warner Music to save about $200 million by the end of fiscal 2025.
In any case, the layoffs will mostly focus on in-house sales teams and other support roles. Warner Music is looking to complete the severance payments worth about $85 million by the end of 2026.
Plan Sale of Assets
Forbes reported that aside from employee reduction, Warner Music is reportedly planning to put its entertainment websites up for sale as well. It was mentioned that Uproxx and HipHopDX are being considered for divestment. This is possible because most of the layoffs will also come from these particular media divisions.
“Today, we are announcing a plan to free up more funds to invest in music and accelerate our growth for the next decade,” WMG’s CEO, Robert Kyncl, said in a memo to employees that Music Business Worldwide obtained. “Our plan includes reducing our workforce by approximately 10%, or 600 people – the majority of which will relate to our Owned & Operated media properties, corporate and various support functions.”
Photo by: Warner Music Group Website
