BUSINESS Disney furloughs 100,000 employees amid COVID-19 pandemic


Disney furloughs 100,000 employees amid COVID-19 pandemic


04:10, April 21, 2020


(Photo: Xinhua)

LOS ANGELES, April 20 (Xinhua) -- Walt Disney Co., is now suspending salary payments to over 100,000 employees, mostly cast members in its theme parks, as the COVID-19 pandemic is delivering blow after blow to the beleaguered entertainment industry, U.S. media reported on Monday.

The move to furlough many of its employees will save Disney about 500 million U.S. dollars a month in expenses. The company has drawn on its credit facilities and has about 20 billion dollars in cash to weather this storm, according to the Motley Fool, a multimedia financial-services company, via

The Hollywood entertainment giant last month shut down the Disneyland Resort in Anaheim, California, and Walt Disney World in Orlando, Florida, and later announced that those theme park resorts will remain closed indefinitely "until further notice" amid the COVID-19 pandemic.

Disney noted on April 2 in a statement that the pandemic is having "a devastating impact on the company with untold suffering and loss" and "has required all of us to make sacrifices."

"Over the last few weeks, mandatory decrees from government officials have shut down a majority of our businesses. Disney employees have received full pay and benefits during this time, and we've committed to paying them through April 18, for a total of five additional weeks of compensation," stated the company.

"However, with no clear indication of when we can restart our businesses, we're forced to make the difficult decision to take the next step and furlough employees whose jobs aren't necessary at this time," added the company.

Shares of Disney dropped in early Monday trading after downgrades from two analysts at UBS and Credit Suisse.

UBS analyst John Hodulik said "the lingering effects of the COVID-19 outbreak will be felt for a number of years" and "the Parks segment is unlikely to regain previous thresholds for profitability until after a vaccine is widely available," the reported.

Credit Suisse analyst Douglas Mitchelson noted that the downside risk for Disney's theme parks business amid the COVID-19 pandemic will be more pronounced over the near-term than the growth opportunities of its streaming business, including Disney+, according to the 

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