Pixar Animation Studios is laying off 175 employees, or about 14% of its workforce, as its parent company Walt Disney Co. (DIS) scales back its content creation.
Disney has said that it is shifting its strategy to focus on the quality of its animated content rather than the quantity.
Layoffs had previously impacted Disney’s other business units, but Pixar’s cuts were delayed because of production schedules.
Disney has found it difficult to get its animated feature films to attract audiences in recent years and has concentrated on making animated content for the Disney+ streaming service.
More broadly, Disney has struggled to attract consumers back to movie theatres after the Covid-19 pandemic ended.
Since 2019, no Pixar animated film has grossed more than $480 million U.S. at the global box office. Before the pandemic, the movie Toy Story 4 earned $1.07 billion U.S. globally in theatres.
Disney chief executive officer (CEO) Bob Iger has said that Pixar will refocus on theatrical release animated movies and move away from short-form series for Disney+.
The stock of Disney has increased 12% over the last year and currently trades at $103.01 U.S. per share.