Disney will begin layoffs this week in the first of three rounds of layoffs by early summer that will eliminate about 7,000 jobs, according to a memo CEO Bob Iger sent to employees, CNBC reports.

The restructuring is part of a larger effort to reduce corporate costs and increase free cash flow.

Last month, Disney said it planned to cut $5.5 billion in spending, including $3 billion in content.

“This week, we are beginning to notify employees whose positions are affected by the company’s downsizing,” Iger wrote in the memo, which was obtained by CNBC.

“Managers will communicate the news directly to the first group of affected employees over the next four days. A second, larger round of announcements will take place in April with an additional several thousand layoffs, and we expect to begin the final round of announcements by early summer to reach our goal of 7,000 jobs,” Iger said.

The layoffs were initially announced in February.

The job cuts will affect businesses including Disney’s Media and Distribution, Parks and Resorts and ESPN.

Disney is following the example of Warner Bros. Discovery and other traditional media companies cutting jobs and costs.

Disney said its streaming business, led by Disney+, Hulu and ESPN+, will stop losing money in 2024.

Disney shares are up about 8% this year after falling 44% last year.

“We have made the difficult decision to reduce our total workforce by approximately 7,000 jobs as part of a strategic reorganization of the company, including significant cost savings measures necessary to create a more efficient, coordinated and effective business,” Iger said. wrote

“For our employees who are not affected, I want to acknowledge that there will undoubtedly be challenges as we continue to build the structures and functions that will allow us to continue to be successful.”

After returning as CEO, Iger reorganized the company and admitted he would consider selling Hulu.

Disney will hold its annual shareholder meeting on April 3.