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Paramount Global’s co-CEOs updated their 20,000 employees on their strategies to cut costs, increase revenue, and reduce debt following the called-off merger with Skydance. The town hall, held on June 25 at the Paramount Theatre in L.A., featured insights from George Cheeks (President and CEO of CBS), Chris McCarthy (President and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks), and Brian Robbins (President and CEO of Paramount Pictures and Nickelodeon). These executives took the helm after Bob Bakish’s dismissal in April.
A primary concern discussed was the planned $500 million reduction in annual costs, announced during the June 4 shareholder meeting. Progress has been made in eliminating redundant roles, particularly in legal and corporate marketing functions. However, the timeline and scale of layoffs remain undisclosed, even after questions during the Q&A segment of the town hall.
Cheeks emphasized ongoing asset sales to manage debt, mentioning that bankers have been hired to assist in this process, although specific assets for sale were not identified. Possible candidates include BET Media, the VidCon creator tradeshow division, and the Paramount Pictures lot.
Initially scheduled for June 5, the town hall was postponed to June 25 due to merger and acquisition (M&A) speculations. On June 11, Shari Redstone, Paramount’s controlling shareholder, ended merger talks with Skydance Media. Redstone is reportedly considering selling her stake in National Amusements Inc., with interest from parties like Edgar Bronfman Jr. and Bain Capital, as well as producer Steven Paul.
Robbins addressed the impact of M&A speculation, acknowledging the disruption it caused. He emphasized the need for a clear plan to ensure success regardless of future corporate paths.
McCarthy highlighted the urgency to reverse declining profits, noting a 61% drop in adjusted operating income from 2018-2023 despite a 13% revenue growth. He stressed immediate action to address this downturn.
The executives also focused on enhancing the profitability of Paramount+ to offset declines in linear TV. McCarthy mentioned ongoing international negotiations to expand the service’s scale and economics, potentially modeling a new approach for the U.S. Paramount has explored merging Paramount+ with NBCUniversal’s Peacock, leveraging their existing joint venture in SkyShowtime.
At the June 4 shareholders meeting, the co-CEOs presented a strategy to streamline the company, targeting redundancies in teams, real estate, marketing, and corporate overhead. The town hall drew around 500 employees in person, with thousands more joining via livestream. The session included an hour of prepared remarks and a Q&A segment.
On June 10, Paramount extended change-in-control severance benefits to Cheeks, McCarthy, and Robbins, ensuring generous packages if the company undergoes a sale or merger, along with additional cash bonuses during their tenure as co-CEOs.
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