The impacted employees, who represent 10 per cent of the company, will largely be at the company’s owned and operated media properties, corporate and support functions, and its advertising sales group, according to a memo sent by CEO Robert Kyncl.
The plan will be achieved “through a combination of the disposal or winding down of certain of the Company’s non-core owned and operated media properties”.
Kyncl also wrote the company will be looking at the “potential sale” of entertainment news sites Uproxx and HipHopDX, while “winding down” the podcasting brand Interval Presents and social media publisher IMGN.
The company has already started to notify employees if they are affected and most will be told by the end of September 2024, according to the memo.
“As we carry out our plan, it’s important to bear in mind why we’re making these difficult choices. We’re getting on the front foot to create a sustainable competitive advantage over the next decade. We’ll do so by increasing funding behind artists and songwriters, new skill sets, and tech, to help us deliver on our three strategic priorities,” Kyncl wrote.
He continued: “This week, our recording artists make up five of the top 10, and our songwriters have six of the Top 10, on the Billboard Hot 100. Today, we’re revealing our latest quarterly results: we grew 11% in normalized revenue. And with growing momentum in Recorded Music streaming and excellent results in Music Publishing, we hit our highest quarterly revenue ever. We’re in a position of strength, and that’s the smart time to change, innovate, and lead. Music is constantly morphing, so we need to morph with it.
“Today, we’re announcing a plan to free up more funds to invest in music and accelerate our growth for the next decade. To do that, we have to make thoughtful choices about where we put our people, resources, and capital. So, as part of that plan, we’ll be realizing approximately $200 million in annualized cost savings by the end of September 2025. The majority of these savings will be reinvested, putting more money behind the music.”
“Thank you for your understanding, passion, and determination. We’re in an amazing industry, we’re partnered with many extraordinary artists and songwriters, and now is the time for us to pioneer the future,” he added.
Warner Music Group one of the "big three" recording companies and the third-largest in the global music industry, after Universal Music Group and Sony Music Entertainment.
The company owns some of the largest record labels in the world, including Elektra Records, Reprise Records, Warner Records, Parlophone Records and Atlantic Records.
Artists under the Warner banner include Ed Sheeran, Dua Lipa, Cardi B and Bruno Mars.