Lionsgate lays off 25 staffers

Lionsgate, the entertainment studio which has struggled in recent years, laid off approximately 25 employees...

Posted: Jan. 11, 2019 10:19 PM
Updated: Jan. 11, 2019 10:19 PM

Lionsgate, the entertainment studio which has struggled in recent years, laid off approximately 25 employees on Friday, people familiar with the matter told CNN.

The staffers who were let go were part of the studio's motion picture marketing and distribution division.

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Eight of the staffers worked in Lionsgate's New York offices of approximately 40 people, one of the people familiar with the matter said. The company employs about 1,600 employees in total.

The same person familiar with the matter told CNN that the layoffs were due to a company restructuring that aimed to centralize operations in the company's Santa Monica, California, offices.

In a note sent to employees, Joe Drake, chairman of Lionsgate Motion Picture Group, said he wished departing staffers "the very best on their continued career trajectory."

"We are constantly looking at ways to better align our company with our industry's evolving landscape and therefore the needs of the audience and our customers," Drake wrote. "We couldn't be more thrilled about what 2019 has in store for us as a company, our exciting upcoming film slate, the new leadership team, as well as the agility that has always been a cornerstone of the company, allowing us to implement new ideas quickly and efficiently."

Lionsgate, which is behind the "Twilight" and "Hunger Games" franchises, has been struggling. The studio's stock has fallen nearly 44% in the past year.

One bright spot is Starz, the premium cable network that Lionsgate acquired in 2016. Starz has about 25 million subscribers in the U.S., the company reported last quarter.

But the studio hasn't been a major driver at the box office -- a problem that executives say they have plans to fix.

"With a really clear understanding of the market, we've been making very significant changes both to the organization and to the content strategy," Drake said on a call with for investors last November. He added that Lionsgate plans to move some titles on its slate to dates that may help the company perform better.

Lionsgate was also once widely considered a potential target for purchase by another major company. At one point, Deadline and Reuters reported that Verizon had expressed interest in Lionsgate. There was also speculation about a potential Amazon takeover after an investor floated the prospect in a Bloomberg report last September.

The latter round of speculation caused the stock to jump several percentage points that month. But nothing has materialized yet.

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