Disney to lay off thousands by Thursday

Walt Disney Co (DIS.US) in February announced a series of organizational changes and cost-cutting plans. Disney stated that it will lay off 7,000 workers by the end of this year. First round of layoffs already took place at the end of March 27 2023. And today Disney announced a second round of layoffs. The job cuts will occur across the company’s business segments and locations. The layoffs are coming from all of Disney’s divisions across the country including its headquarters in Burbank and Connecticut, where its ESPN sports networks are based. The hourly workers at Disney’s theme parks won’t be affected

The third round of cuts is expected before the beginning of summer. Wall Street's focus on the staggering cost of operating online video platforms has shifted attention away from subscriber growth. It is expected that "several thousands" employees will lose their jobs by Thursday, taking the total number of job losses so far to around 4,000. 

According to the CEO, Bob Iger, the company is targeting $5.5 billion of cost savings. First, reductions to the company's non-content costs will total roughly $2.5 billion, not adjusted for inflation. Another $1 billion of savings is already underway after the first round of layoffs announced already this year. 

Walt Disney Co.'s (DIS.US) stock price has been on an uptrend since the beginning of the year, currently trading at $99.3. During the post-COVID rally, the company's stock price reached around $200, which represents a decline of approximately 50% from the current price level.

There is a significant support level at $91.14, which has been tested multiple times in the past. On the upside, there are two significant resistance levels to watch for at $107.3 and $113.9. A break above these levels could signal further upward momentum in the stock price. However, taking into account current market conditions, also a retest of $91.14 is possible. Investors should pay close attention to the upcoming earnings results on May 10.