Time Inc. is cutting roughly 300 jobs, or 4% of the global workforce, in an effort to restructure its priorities to the video and digital landscapes.
The announcement came Tuesday as Time Inc. -- the publisher of Sports Illustrated, Fortune, People and Time, among others -- navigates a period of "rapid transformation," according to a memo from CEO Rich Battista. The year began with speculation that Time Inc. would find a buyer, but no deal was struck as the magazine group doubled down on pursuing its "strategic plan."
That plan was to focus more on video and digital, as well as native advertising, digital sales, licensing and branding.
The news came weeks after Battista sent a company-wide memo on May 23, along with a survey that sought to "help us better understand our culture" and find ways Time Inc. can "align on a strategy and vision, execute against that strategy and renew itself over time." The survey concluded on June 1, according to people inside the company.
Layoffs and buyouts inevitably come with restructuring. Today's announcement of cutting roughly 300 global jobs -- a little more than half of which are based in the U.S. -- leaves Time Inc.'s global workforce at about 7,200 employees, about the same total that followed last year's reorganization.
The company refocus will aim toward digital sales, and Gregory Giangrande, Time Inc.'s head of human resources, said the company expects a "hiring spree for digital sellers."
It's no secret Time Inc. has struggled, along with other traditional print publishers, as it refocuses on digital media. Time Inc.'s print advertising revenue declined 21% to $212 million in this year's first quarter.
In its public quarterly report, the company noted these declines were due to, among other factors, the reorganization of the advertising sales force. The past year has seen a couple reorganizations and strategy changes in advertising sales.
Reorganization and layoffs have led to a decrease in morale within the company, according to people within Time Inc. One Time Inc. executive, speaking on condition of anonymity, said "this latest wave will accelerate the [company's] decline."
Internal anxieties weren't soothed when Time Inc. hired McKinsey & Co., a cost-cutting consultancy, last month. McKinsey, according to a source within Time Inc., has "set up shop in closed conference rooms."
Giangrande and Battista disputed reports of declining morale from within the organization. Giangrande said the remaining 7,200 Time Inc. employees are "energized" and that "morale is not impacted by and large by this action today."
"Clearly, nobody is happy that 300 employees are leaving the company," he said.
Battista also credited the way Time Inc. has been upfront about its plans. "People who work here understand (reorganization) and appreciate the candor and that we're doing it in a thoughtful and honest way," he said.