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WarnerMedia Begins Layoffs to Restructure Around HBO Max

WarnerMedia layoffs began Tuesday in North America. WarnerMedia is restructuring to support its streaming video business with HBO Max.
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WarnerMedia, the entertainment arm of AT&T  (T) - Get AT&T Inc. Report, reportedly began laying off employees in a move that is expected to eliminate thousands of jobs.

The layoffs are part of a plan to restructure its business around its streaming video service, HBO Max.

Shares of AT&T were up 1.86% to $28.83.

More than 1,000 employees will lose their jobs, The Wall Street Journal reported, citing people familiar with the matter, and the number could approach 2,000 of the company's 25,000 employees. 

This would be in addition to the roughly 500 employees who were let go in August. The pandemic has drained income from movie tickets, cable subscriptions and television ads, the Journal said. The layoffs are also part of a restructuring plan that has been in the works.

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“Today, we have arrived at a number of difficult decisions that are resulting in a smaller WarnerMedia team,” CEO Jason Kilar said in an email to employees, according to the Wrap. “This is a function of removing layers and the impact of consolidating previously separate organizations.”

Kilar said job eliminations began Tuesday in North America. The company is continuing to evaluate the non-U.S. businesses and those impacted will receive severance, healthcare and professional services.

Last month, the Journal said that WarnerMedia was aiming to cut costs by 20%, which could result in thousands of employees losing their jobs.

Many of the top executives at Time Warner’s HBO, Turner and Warner Bros. production studio have already departed before the announcement, CNBC reported, including ex-HBO chief Richard Plepler, ex-Turner president David Levy and ex-Warner Bros. Entertainment CEO and Chairman Kevin Tsujihara.

“To our colleagues who are leaving, I wish there were words to lessen today’s pain. Your contributions are a permanent part of this great company and today’s news does not change that,” Kilar said. “I am extremely thankful for all that you have done for this team and this mission. I hope that at some point you will look back on all of it with immense pride.”

WarnerMedia did not immediately respond to a request for comment. A town hall has been scheduled for Wednesday