Disney is cutting jobs and original content for streaming, resulting in layoffs at Pixar.

In a major restructuring move, Disney has announced that it will be laying off 14% of Pixar’s total workforce, affecting roughly 175 employees at Pixar Animation Studios. This decision comes as part of a larger effort to shift the company’s focus towards quality over quantity programming.

The layoffs, which were expected for some time but delayed due to production schedules, mark the biggest restructuring effort in Pixar’s 38-year history. However, top leadership at the company remains unaffected by the job cuts.

According to an internal memo seen by the New York Times, Pixar will no longer produce original series for its streaming services, instead focusing on “feature films.” This move aligns with Disney CEO Bob Iger’s recent comments about the need to consolidate and prioritize quality in the company’s content offerings.

During the pandemic, Disney released three Pixar films directly on Disney+ instead of in theaters, a strategy aimed at navigating theater closures and Covid restrictions. Despite these efforts, Disney+ saw a loss of 1.3 million core subscribers in Q1 2024, likely due to recent price hikes.

Looking ahead, Pixar’s next film, “Inside Out 2,” is set to hit theaters on June 14. The Walt Disney Co. has seen a 12% increase in its stock price year over year, reflecting investor confidence in the company’s strategic direction.

Overall, the layoffs at Pixar signal a significant shift in Disney’s approach to content production, emphasizing a renewed focus on quality and consolidation in the face of changing market dynamics.