[Source: Reuters]

Paramount Global (PARA.O), opens new tab will begin laying off 15% of its workforce in the United States starting Tuesday.

And close down its Paramount Television studio as part of a planned restructuring, the media giant said in internal communication.

Paramount, which owns networks like CBS, MTV and Comedy Central, aims to reduce annual costs by $500 million and return to profitable growth ahead of its merger with David Ellison’s Skydance Media.

In an internal memo, Paramount’s co-CEOs stated that the company is at an “inflection point” where changes are necessary to strengthen the business.

The layoffs, which were announced during a post-earnings call last week, are expected to affect roughly 2,000 people. They will continue through the end of 2024, with 90% of the cuts expected to be completed by the end of September.

Paramount Television Studios (PTVS) will also be shut down as part of the company’s broader restructuring plans, President Nicole Clemens said in an email to employees.

George Cheeks, Paramount Global’s co-CEO, said the move to close down the studio by the end of the week is the result of major shifts in the television and streaming industry and a need to streamline the company.

All current PTVS series and development projects will be transferred to CBS Studios, Cheeks said, adding that members of CBS teams will also be leaving the company.

The restructuring comes as the New York-based company navigates a challenging linear TV market, having recently written down the value of its cable networks by nearly $6 billion.

The company’s streaming division, which includes Pluto TV and Paramount+, reported its first quarterly profit in three years on Thursday.