Paramount Global, a titan in the media and entertainment industry, has announced yet another round of layoffs, cutting 3.5% of its U.S. workforce as it grapples with persistent economic challenges and a rapidly shifting media landscape.

Detailed in an internal memo obtained by Reuters, the move marks the company’s second significant downsizing effort within the past year, reflecting broader struggles within the traditional television sector as cord-cutting accelerates and streaming competition intensifies.

The layoffs, which are expected to impact several hundred employees, come as Paramount navigates a decline in cable TV subscribers—a trend that has eroded the profitability of linear television. According to Reuters, the company’s leadership cited these industry headwinds as a primary driver for the cuts, alongside a need to streamline operations amid a “dynamic macro-environment.”

Industry Pressures Mount

This latest reduction follows a larger cut last year, when Paramount slashed 15% of its U.S. workforce, affecting approximately 2,000 to 3,000 employees as part of a $500 million cost-saving initiative. The company, which ended 2024 with about 18,600 staff members, has been under immense pressure to adapt to a media ecosystem where streaming platforms dominate consumer attention and advertising dollars increasingly shift to digital channels.

Paramount’s challenges are compounded by its ongoing merger discussions with Skydance Media, a deal that awaits regulatory approval from the Federal Communications Commission. As reported by CBS News, the layoffs are seen as a strategic move to position the company for this potential merger, trimming costs to make the balance sheet more attractive to investors and partners.

A Broader Trend in Media

The struggles at Paramount are not isolated. Competitors like Disney and Warner Bros. have also implemented significant layoffs in recent years, reflecting a sector-wide pivot away from traditional pay-TV models. The decline in linear TV viewership, as noted in posts found on X, has forced media giants to rethink their business models, often at the expense of jobs in legacy divisions like cable networks and television studios.

Moreover, Paramount’s decision to shut down Paramount Television Studios last year—a move aimed at further cost reduction—underscores the depth of the transformation underway. As Variety highlighted, the company is focusing on consolidating content production under other banners while prioritizing investments in streaming platforms like Paramount+, which has yet to achieve the profitability of rivals like Netflix.

Looking Ahead

For industry insiders, these layoffs signal a critical juncture for Paramount and the broader media landscape. The company’s ability to balance cost-cutting with strategic investments in digital growth will determine its long-term viability. As Fortune reported, Paramount’s repeated workforce reductions—coming regularly since last February—suggest a prolonged period of uncertainty for employees and stakeholders alike.

While the immediate impact of the 3.5% cut will be felt by those losing their jobs, the ripple effects could influence investor confidence and merger outcomes. Paramount’s leadership, in the memo shared with Business Insider, emphasized that these decisions, though difficult, are necessary to ensure the company’s future competitiveness. Whether these measures will stabilize Paramount in an era of relentless disruption remains an open question, but for now, the focus is on survival and adaptation in a media world that shows no signs of slowing its transformation.