Disney (DIS) will lay off 7,000 workers as the company seeks to slash $5.5 billion in costs. As a result, the media giant plans to restructure the organization into three core business segments: Disney Entertainment, ESPN, and Disney Parks, Experiences and Products.

"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."

Disney shares were up as much as 8% following Iger's comments on staff cuts and cost reductions. Shares have since pared gains modestly in after-hours trading, up about 5%.

Disney reported quarterly results after the bell on Wednesday that showed a beat on both the top and bottom lines as demand for the company's theme parks soared during the holiday period.

As expected, Disney+ subscribers showed a slight dip in the first quarter due to the absence of the Indian Premier League cricket tournament on its Indian brand, Disney+ Hotstar.

Streaming losses narrowed to $1.1 billion in Q1 against a loss of $1.5 billion in the fourth quarter — ahead of the company's previous guidance as Disney's ad-supported tier and recent price increases helped pare losses.

Wednesday's report served as the first since CEO Bob Iger's return to the company in November

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."

Alan Bergman and Dana Walden will be Co-Chairs of Disney Entertainment, which will include the company's full portfolio of entertainment media and content businesses globally, including streaming.

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

Iger underscored his commitment to creating a direct link between content decisions and financial performance. He said Disney+ is on track to achieve profitability by the end of fiscal 2024.

Elsewhere on the call, Iger revealed he has asked the board to reinstate the company's dividend by the end of the calendar year — something activist investor Nelson Peltz pushed for explicitly in his proxy battle.