Disney Cuts 250 Consumer Products Jobs in Game-Strategy Shift

(Bloomberg) -- Walt Disney Co. cut 250 jobs in its consumer products and interactive media unit, about 5 percent of the division’s total employment, as the company shifts to licensing characters to video-game producers rather than making games itself.

About half of the positions being eliminated are in Bellevue, Washington, where employees created social games for distribution on Facebook.com. A sequel to the company’s Marvel Avengers online game performed poorly, according to a spokesman who confirmed the cuts Wednesday.

Earlier this year, the company eliminated about 300 jobs when it shut down its Avalanche Software unit in Salt Lake City. That business made the Disney Infinity line of console games and figures. Companywide, Disney had 185,000 employees at the end of its previous fiscal year.

The other positions cut in the latest round were in areas such as human resources and information technology and are related to last year’s consolidation of the consumer products and interactive businesses, which were previously separate, the spokesman said. Consumer products sales fell 1 percent in the quarter ended July 2 and profit dropped 7 percent as Disney failed to match strong year-earlier sales from the animated hit “Frozen.”

The job cuts were reported earlier Wednesday by the New York Times.

To contact the reporter on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net. To contact the editors responsible for this story: Crayton Harrison at tharrison5@bloomberg.net, Rob Golum