LOS ANGELES, April 8 (Xinhua) -- Sony Pictures Entertainment has announced its plan to lay off several hundred employees across its film, television, and corporate divisions globally, as part of a sweeping restructuring of its business.
The studio, with a global workforce of roughly 12,000, said the move is intended to redirect resources toward areas with strong growth potential, as Hollywood continues to reel from pandemic disruptions, labor strikes and production that has moved out of California.
The company is "aligning our organization with where the business is going -- not where it has been," chief executive Ravi Ahuja told employees in a memo on Tuesday.
People familiar with the plan described the layoffs as targeted rather than a broad cost-cutting drive, as Sony refocuses on areas it believes can generate steadier returns: franchise strategy and brand extensions, experiences, next-generation and platform-native programming, and deeper corporate ecosystem connectivity -- including film and TV adaptations of video game properties. Sony also pointed to opportunities in anime, where it owns streaming service Crunchyroll.
The layoffs add to a drumbeat of workforce reductions across the entertainment business as traditional revenue sources erode and production levels remain uneven. The pandemic paused filming, slowed theater attendance and accelerated shifts toward streaming. After that, the Hollywood writers and actors strike in 2023 halted much of the industry for months, then ushered in a cautious restart as studios and streamers reexamined spending and emphasized profitability.
At the same time, "runaway production" -- the movement of film and TV jobs to states and countries offering richer incentives -- has been a lingering concern for California, where soundstages, postproduction houses and thousands of crew members are concentrated in and around Los Angeles.
Terry Baker, whose husband works for Sony, told Xinhua that it "will be a disaster for our family if my husband gets laid off." "There's just no other jobs to be had."
Even though Sony's U.S.-based headquarters will remain in the Los Angeles area, a growing share of filming, visual effects and other work will be done elsewhere where production costs are cheaper and heavily subsidized by government tax incentives, further reducing the number of local jobs tied to each project.
For Los Angeles County and the broader California economy, layoffs at a major studio can create an economic ripple effect. Studio workers and production staff are steady customers for restaurants, childcare providers, dry cleaners and other small businesses near entertainment hubs such as Culver City, Burbank and Hollywood.
Vendors that supply productions -- from equipment rental to transportation, catering and security -- can also feel the impact if fewer shows are ordered or more work shifts out of state.
Layoffs and fewer production schedules can translate into reduced consumer spending and, potentially, less tax revenue.
Sony's emphasis on game shows and franchise expansions could preserve some production activities typically based in Los Angeles, including long-running syndicated formats such as "Jeopardy!" and "Wheel of Fortune." But cuts to visual effects and virtual production could undermine a key segment of the local workforce, as studios grow more dependent on digital tools and visual effects work becomes increasingly mobile, driven by tax incentives and global labor markets.
Unlike several of its rivals, Sony does not operate a broad, general-entertainment streaming service, but instead sells films and series to multiple platforms and relies on deals with streamers and networks. Ahuja told employees the company's "independent" studio model gives it flexibility to match projects with the right buyers, while Sony's ownership of anime and its ties to PlayStation and other Sony businesses offer additional paths for growth.
Still, the job losses underscore the fragile recovery for a region that has long depended on entertainment as a signature employer and export industry. Many workers say that stability, not just the next greenlight, remains the industry's scarcest commodity. ■