CNN chief Chris Licht, who joined the company six months ago, sent employees a disheartening memo Wednesday signaling impending layoffs and budget cuts.
He wrote that there is “widespread concern over the global economic outlook, and we must factor that risk into our long-term planning. All this together will mean noticeable change to this organization. That, by definition, is unsettling. These changes will not be easy because they will affect people, budgets and projects.”
At the same time, Licht promised that “I will not allow these changes to affect our position as the world’s leading news source, and we will continue to invest in growth areas.” He also noted that “we will be strategic in this process and will minimize the impact on our core newsgathering operation and Digital, both of which have already executed smart changes.”
He said these unspecified “changes” will happen before the end of the year.
CNN has seen ratings fall off this year with third-quarter prime-time viewership down 13% year over year, remaining in third place behind Fox News and MSNBC. All three networks have seen ratings decline year over year in the 25-54 demographic.
The network remains comfortably profitable. But projections from S&P Global Market Intelligence anticipate CNN’s profits may fall to below $1 billion this year for the first time in several years.
When Discovery took over CNN’s parent Warner Brothers earlier this year, the streaming service CNN+ was immediately dismantled after just a month in service. Licht has also made some changes to the CNN lineup itself, creating a new morning show hosted by Don Lemon, Poppy Harlow and Kaitlin Collins set to launch next week, eliminating the media criticism weekend show “Reliable Sources” with Brian Stelter and adding an interview show hosted by Chris Wallace.
CNN, which has about 4,000 employees worldwide, was launched in Atlanta in 1980 but by the early 2010s, the nexus of power shifted north. Management and most key anchors are now based in New York City.
Nonetheless, about 1,200 employees are still based in downtown Atlanta, most working at CNN Center, many in the digital area and international operations. CNN’s predecessor owner AT&T last year sold CNN Center to a Florida-based investment group. This has not led to an immediate departure of CNN employees from the space.
A CNN spokesman said operations will move to the Midtown campus at some point next year.
Parent company Warner Bros. Discovery is looking to cut costs across the entire company. It has cut original scripted programming from TNT and TBS and disclosed to investors that it expects to take restructuring charges that could hit $4.3 billion related to the merger, setting aside $1.1 billion for layoffs and other personnel changes.
Licht, in an interview with CNBC earlier this week, said CNN damaged its brand during the Trump era by chasing ratings.
“The brand is the most trusted brand in the world when it comes to journalism, right up there with the BBC,” Licht told CNBC. “I think what happened a little bit here in the past was it’s easy to take the quick sugar high of ratings and outrage.”
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