News Corp. has made a difficult decision and has already made an official announcement regarding that on Thursday.
According to the officials at News Corp., they have made the decision that they will cut down on employment.
As per the announcement, the company wants to let go of 5% of its overall workforce. The 5% workforce translates to 1,250 positions.
News Corp. to lay off 5% of Employees
The executives at the media company have confirmed that they had to make the difficult decision of laying off their employees.
This is yet another wave of layoffs that the media companies have brought into play. The main goal behind the reduction in workforce is part of the plan that the company wants to lower its operational costs.
It is quite expensive to have employees that use up a lot of finances out of the company at a time when the market is down.
If the company does not generate enough income, then it is important that they must cut down on its operational costs.
This way, they can lower their losses and the most effective strategy is to lower the employee base. If the work inflow is less, then there is no point in having extra resources on hand.
This is what the company has realized and has made its decision based on the particular speculations. Both the tech and the media sectors have been heavily hit by macroeconomic conditions in the year 2022.
They are looking at similar forecasts for the year 2023 as there are strong predictions about the entire world’s economy falling into recession.
Therefore, it is a wise decision by the firm that they are reducing its headcount by 5%. This would help prepare the company for the worst market conditions and help them deal with the situation before it worsens.
Statement Issued by News Corp.
The officials at the media company owned by Rupert Murdoch recently made a statement about the company’s position.
For those who are not familiar with News Corp., it is a media company that owns major companies such as HarperCollins, The New York Post, and The Wall Street Journal.
The company has also cited a macroeconomic environment that is constantly growing tougher on their business. Even the rising interest rates are taking a huge toll on their business.
The macroeconomic environment is something that is causing a major impact on their business. The impact is not positive but negative and they are afraid that they may have to continue releasing more positions.
This would continue lowering their headcount and it will constantly hurt the reputation of their business. These developments would eventually make it extremely difficult for the company to operate.
Earnings Reported by News Corp.
The media company also shared its earnings results for the fourth quarter of 2022 on Thursday. They revealed that their revenue recorded a decline in the fourth quarter by 7%.
The decline was recorded compared to the same quarter of 2021. The revenue of their company went down to $2.52 billion for the respective quarter.
The advertising market has become extremely challenging for media companies. News Corp. has also found itself facing the same market downtrend and is trying hard to cope with it.
Robert Thomson’s Statement
The Chief Executive Officer of News Corp. shared his views about the company’s performance during the pandemic versus the current performance.
He stated that their company recorded huge growth and expansion during the pandemic. It was the time when media advertisements were at their peak and the situation has continued deteriorating since then.
As the pandemic faded away and people started going out for their day-to-day activities, the media advertisement business has gone down.
After the announcement of downsizing, the share prices for the company have recorded a dip in the latest trading session. The share prices for News Corp. have dipped 1.18% in the latest session.