Skydance Targets $6 Billion Savings After Paramount-Warner Merger
Skydance is cutting gaming staff and consolidating streaming services to reduce $80 billion in debt following its merger of Paramount and Warner Bros. Discovery.
The newly formed Skydance entity, created from the $110 billion merger of Paramount and Warner Bros. Discovery, has announced a plan to achieve at least $6 billion in cost savings over the next three years. The company aims to reduce duplicative spending across a $50 billion expense base by consolidating corporate functions, studio groups, and streaming architectures. To facilitate these cuts, Skydance has implemented a mandatory five-day in-office policy and offered voluntary buyouts.
As part of this reorganization, Skydance Games laid off 25 to 30 developers, including associate design director David Ballard. The company stated it is scaling down some projects to position for long-term growth, though it will continue developing Marvel 1943: Rise of Hydra and an untitled Star Wars game. Simultaneously, DC Studios announced that co-chairmen James Gunn and Peter Safran will step down on December 1.
To drive revenue and compete with rivals like Netflix, CEO David Ellison plans to launch a combined subscription bundle of Paramount+ and HBO Max in early 2027. The bundle is expected to be 30% to 35% cheaper than standalone services. These moves come as the company manages over $80 billion in debt and faces a decline in linear TV profits, which currently account for 70% of its earnings. Management targets reducing its leverage from 6.1 times to 3 times by 2030.
