Disney Cuts Hundreds of Jobs, Pixar Hit Hardest Despite Toy Story 5's Record Opening

Disney cut several hundred jobs across its entertainment businesses on Tuesday, the company's third round of layoffs in 2026. Pixar's Emeryville studio absorbed the biggest hit within the film division, according to the Hollywood Reporter.

Disney has not officially disclosed a division-by-division breakdown. But a source told TheWrap roughly 116 Pixar employees lost their jobs, while the San Francisco Chronicle put the range between 116 and 150 positions, or fewer than 10% of the studio's workforce.

The cuts also hit Disney Entertainment Television, ESPN, National Geographic, corporate divisions and Disney Studios more broadly. National Geographic was reportedly among the hardest-hit television units, per the Hollywood Reporter. At ESPN, many eliminated roles were behind-the-scenes positions tied to folding in NFL Network operations.

The Toy Story 5 Paradox

This is happening while Pixar is having one of its best box office years in a decade.

Toy Story 5 opened June 19 and pulled in an estimated $312 million worldwide over its debut weekend, including a franchise-record $160 million domestically, according to the San Francisco Chronicle. NDTV Profit reports Pixar has generated more than $1 billion worldwide this year, driven by Toy Story 5 and the original film Hoppers.

Yet the layoffs are landing anyway. Disney says that's the point.

A Disney spokesperson told TheWrap the cuts are "part of our continual evaluation of how we manage resources and reinvest across the company as our industry continues to evolve." NDTV Profit reports most of the reductions are concentrated in production and operations teams as Pixar shifts to a leaner production model, making fewer movies with tighter budgets rather than trying to sustain a big annual output.

A studio that produces four films every three years doesn't need the same production headcount as one churning out a movie every year. Disney's stated strategy is fewer, bigger theatrical bets. Gatto, from Luca director Enrico Casarosa, and Incredibles 3 remain on Pixar's upcoming slate, per SFist.

The timing is brutal for anyone getting a pink slip weeks after their studio delivered a franchise-record opening.

A Pattern, Not a One-Off

This is not Pixar's first haircut. The studio eliminated about 175 jobs, roughly 14% of its workforce, in 2024, following another 75 layoffs the year before, as Disney pivoted away from prioritizing streaming content and back toward theatrical releases, according to SFist's prior reporting.

Company-wide, Disney eliminated roughly 1,000 positions in April across marketing, television, ESPN, technology, studio operations and corporate teams. Josh D'Amaro, Chairman of Disney Experiences, told employees at the time: "We're building a company that's more agile and better equipped for how the entertainment business is changing."

NDTV Profit notes Disney had already consolidated parts of its marketing operations back in January, meaning this week's cuts mark at least the third distinct workforce reduction of 2026.

The Mixed Bag Behind the Cuts

Pixar's box office isn't uniformly strong, which complicates any simple "success didn't save jobs" narrative. Elio posted the weakest opening weekend in studio history last year. Hoppers earned better reviews and stronger ticket sales but still fell short of what Pixar's established franchises typically pull in, according to both the New York Post and SFist.

The picture is not "hit movie, layoffs anyway" in isolation. It's a studio with one franchise blockbuster (Toy Story 5), one underperformer (Elio), and one modest original success (Hoppers), all while corporate leadership pushes toward a smaller, more selective production pipeline. SFist and the New York Post note most of this week's cuts were concentrated in production and operations roles tied to that pipeline shift, not tied to any single film's performance.

Disney employed roughly 230,000 people worldwide as of late 2025, according to SFist. Even at 1,000-plus cumulative layoffs across 2026's rounds, that's under half a percent of the total workforce. But for the Pixar employees affected, and for a studio culture that has now seen four separate rounds of cuts since 2023, the message is consistent regardless of what's playing in theaters: leaner is the mandate.

Disney has not said whether further rounds are planned before year's end, and has not disclosed exact separation packages or timelines for affected employees. Employees were notified Tuesday morning, according to the Hollywood Reporter.