EMI faces the music in struggle for profitability
NEW YORK - EMI will ax 1,800 staffers worldwide — nearly 20% of its work force — has cast off a quarter of its 1,600 artists, and will take more than $340 million in charges in an aggressive bid to return the stumbling British music group to fighting form.
The drastic cost-cutting actions, announced last Wednesday by EMI Recorded Music chief Alain Levy at a conference for investors in London, are the culmination of a worldwide evaluation of EMI's operations initiated when he took over the company six months ago.
Levy said half of the 1,800 job cuts have already happened or will happen by the end of the month, while the other half will be completed by the end of September. Roughly 400 of the layoffs will come from the U.S. operation, where EMI has languished in last place among the five majors and its key labels, Capitol and Virgin, have struggled to generate new hits for the better part of a decade.
Levy said almost half the planned $140 million in annual cost savings will come from the North America region because salaries and operating overhead are far higher here than in other territories.
"This is not just a cost-cutting exercise," Levy said at the conference, also attended by chairman Eric Nicoli and EMI division chiefs from around the globe. "This is reshaping EMI for the future and positioning it for growth with a much lower cost base."
— This article by Justin Oppelaar and Erich Boehm.
Technical errors may occur.