Disney's Pixar Animation Studios has confirmed an earlier report from TechCrunch that the studio will undergo layoffs this year.
Sources revealed to TechCrunch that Pixar could lay off hundreds of current employees — perhaps as many as 20% of the current workforce. Such a move would reduce Pixar's team of 1,300 to less than 1,000.
Although Pixar did confirm that layoffs will come this year, the studio said that the reported numbers are too high. The studio revealed that the number of impacted employees is still to be determined based on factors like "production schedules and staffing for future greenlit films."
The layoffs are expected to take place later this year.
Once a box office darling, Pixar has struggled to rebound from the pandemic. Since December 2020, Pixar has released five feature films, although three of them — Soul, Luca, and Turning Red — were released straight to Disney+ due to the pandemic.
Lightyear was released in June 2022 and marked Pixar's grand return to the box office. But the Toy Story spin-off, which received mixed reviews, tanked at the box office. Hoping for the film to take the studio to infinity beyond, it grossed just $226 million worldwide against its $200 million budget.
Looking to rebound, Pixar released Elemental in June 2023. After a disastrous opening weekend, many were quick to write off the film as another box office bomb. However, the film managed to sustain long legs and, combined with a strong performance overseas, grossed more than $475 million worldwide. Its expensive $200 million budget prevented it from being a huge financial winner for Disney, but it did become a sleeper hit and proved that Pixar still can capture the box office magic.
Looking ahead, Pixar is set to release Inside Out 2 this summer. The highly anticipated sequel follows Riley, who is now a teenager and experiencing even more emotions, including Anxiety. Inside Out 2 is set to hit theaters on June 14, 2024. A teaser for the film was released a few months back.
Pixar's other feature film, Elio, which was supposed to come out before Inside Out 2 has since been delayed to June 2025.
It seems, however, that Pixar's layoffs may not be entirely related to the studio's box office struggles. According to TechCrunch's insiders, the layoffs will include those who were hired for Disney+. The publication notes these were "hires Disney pushed on Pixar to produce for its streaming division, which hasn’t yet turned a profit."
In an effort to get the streaming service out of the red by Q4 2024, Disney is undergoing a companywide "restructuring." Disney+ has so far managed to cut its losses from the $1.5 billion lost in Q4 2022 to $387 million in Q4 2023.