Disney (DIS) is planning to cut costs by $5.5 billion and will lay off 7,000 employees. The media conglomerate intends to reorganize the company into three main business units as a result: ESPN, Disney Parks, Experiences, and Products, as well as Disney Entertainment.

“We will be reducing our workforce by approximately 7,000 jobs,” CEO Bob Iger said during the company’s first quarter earnings call. “While this is necessary to address the challenges we’re facing today, I do not make this decision lightly. I have enormous respect and appreciation for the talent and dedication of our employees worldwide, and I’m mindful of the personal impact of these changes.”

Following Iger’s remarks regarding staff reductions and cost reductions, Disney shares rose as much as 8%. Since then, shares have lost about 5% in after-hours trading.

After the bell on Wednesday, Disney released quarterly results that showed a beat on both the top and bottom lines as holiday demand for the company’s theme parks increased.

Due to the absence of the Indian Premier League cricket tournament on its Indian brand, Disney+ Hotstar, Disney+ subscribers experienced a slight decline in the first quarter, as anticipated.

As a result of Disney’s ad-supported tier and recent price increases, streaming losses decreased to $1.1 billion in the first quarter, down from $1.5 billion in the fourth quarter. This was ahead of the company’s previous guidance.

The first report since CEO Bob Iger returned to the business in November was released on Wednesday.

In his prepared remarks, Iger said the new strategic organization, “will result in a more cost-effective coordinated and streamlined approach to our operations, and we are committed to running our businesses more efficiently, especially in a challenging economic environment.”

Disney Entertainment, which includes the company’s global portfolio of entertainment media and content businesses, including streaming, will have Dana Walden and Alan Bergman as co-chairs.

Josh D’Amaro will continue to be Chairman of Disney Parks, Experiences, and Products, while Jimmy Pitaro will continue to be Chairman of ESPN, which will include ESPN Networks, ESPN+, and its international sports channels.

Iger emphasized his commitment to establishing a direct link between financial performance and content choices. He stated that Disney+ is on track to turn a profit by the end of the fiscal year 2024.

Iger revealed on the call that he has asked the board to reinstate the company’s dividend by the end of the year, something that activist investor Nelson Peltz explicitly pushed for in his proxy fight.

The dividend, which was halted during the pandemic in an effort to conserve cash, will be “modest” at first but steadily increase over time, the executive said, adding: “Our cost cutting initiatives will make this possible.”

Trian Fund Management, run by Peltz, stated that it owns roughly $900 million worth of Disney stock—roughly 9.4 million shares. The hedge fund, which did not like Iger’s unexpected return, is pushing for more cost reductions, operational changes, and a successor after Iger, which the company also wants.

“On the topic of succession, the board recently established a dedicated succession planning committee headed by Mark Parker, who will become chairman of the Walt Disney company’s board following its annual meeting in early April,” Iger said on the call.

The current proxy dispute with Peltz was not directly addressed by the executive. On April 3 at 10 a.m. PT, the company will hold its annual shareholder meeting.