Paramount and Warner Bros. Discovery officially became one company Tuesday, but employees did not have long to celebrate before executives acknowledged that job cuts are coming.
According to Skydance’s official announcement, the Warner Bros. Discovery acquisition closed October 6, creating a newly combined entertainment company named Skydance. The deal brings Paramount Pictures, Warner Bros., CBS, HBO, CNN, Paramount+, HBO Max, TNT Sports and numerous other entertainment brands under the same corporate parent.
The Associated Press values the acquisition at approximately $81 billion, while Reuters places the overall transaction value at roughly $110 billion when debt is included. Warner Bros. Discovery shareholders received approximately $31.02 per share in cash, according to Skydance, and the former WBD stock stopped trading on Nasdaq Tuesday.
For workers, however, the biggest question surrounding the completed merger is what happens next.
David Ellison and Ynon Kreiz, who now serve as the combined company’s chief executives, directly addressed potential Skydance layoffs in a Tuesday memo obtained by Variety.
“Integrating two companies will bring change, including difficult decisions that affect our workforce. We are committed to handling this process thoughtfully and respectfully,” the executives wrote.
Those difficult decisions come as Skydance pursues at least $6 billion in annual run rate savings within three years. According to the company’s closing announcement, management believes combining operations, technology and other functions can make the new business leaner while freeing money for programming, creators and technology.
Reuters reports that management expects much of those savings to come from areas beyond direct labor reductions, including combining streaming infrastructure and cloud technology. Still, the company has not publicly disclosed how many employees could lose their jobs, and the acknowledgment that workforce decisions are coming has intensified uncertainty across both organizations.
The concerns are especially significant in Los Angeles.
According to the Los Angeles County Department of Economic Opportunity, an August analysis concluded that as many as 4,500 direct film and television jobs could be at risk during the three-year integration period. The county also estimated more than 10,000 total job years could be exposed when indirect economic effects are included.
An earlier county analysis identified approximately 2,495 potentially overlapping local positions in areas where Paramount and Warner Bros. Discovery maintained similar corporate functions. County officials stressed that those positions should not be interpreted as a confirmed layoff list, but the overlap illustrates why employees are watching the consolidation closely.
The new Skydance workforce is also entering the merger after both sides have already experienced substantial restructuring.
In January 2025, Reuters reported that CNN planned to cut about 6 percent of its workforce as the network shifted resources toward digital products and subscription services. CNN remained under Warner Bros. Discovery at the time and was confronting declining traditional cable audiences.
Warner Bros. Discovery followed with another major round of cuts in July 2025. Reuters reported that approximately 10 percent of employees in the company’s motion picture group were affected, including workers across marketing, distribution and production.
Those reductions followed years of consolidation throughout Hollywood as legacy media companies tried to manage declining cable television revenue, expensive streaming operations and competition from technology-driven entertainment platforms.
The Skydance merger now creates one of the largest entertainment companies in the world. According to Skydance, the combined business generates nearly $70 billion in annual revenue, serves more than 200 million streaming subscribers and controls franchises ranging from “Top Gun” and “SpongeBob SquarePants” to “Harry Potter,” DC and “The White Lotus.”
Regulators also placed conditions on the merger after California and other states challenged the transaction. According to Reuters, Skydance agreed to additional domestic production investment and theatrical release commitments, including at least 30 movies annually during the early years of the settlement.
For employees, those production promises now exist alongside a very different corporate mandate: eliminate billions of dollars in duplicated costs.
Ellison and Kreiz made clear Tuesday that the merger closing is only the beginning.
“Today is Day One,” they told employees.
For thousands of workers across Paramount, Warner Bros., CNN, CBS, HBO and the companies’ overlapping corporate operations, the next phase will determine just how many people remain part of Day Two.
