Disney to Reduce Stock Based Compensation for Tech Employees

Disney is reportedly reducing stock-based compensation for some tech employees, according to sources seen by Business Insider. 

According to these sources, who work as software engineers at the company, the ceiling for their long-term incentive awards is being cut from 35% of their base salary to 25%. 

In a recording of the conversation, an unnamed director said that there was “no way to sugarcoat,” that this was a “reduction in your total compensation.”

This compensation reduction follows news of widespread layoffs for Disney, announced around a month after Josh D’Amaro took the helm as CEO. 

Competitive stock offerings

According to reports from Business Insider, the decision to reduce stock-based compensation is “totally unrelated” to performance, and came after Disney leadership completed “a review of the US and Canada technology compensation market,” the director shared. 

Disney has typically used Restricted Stock Units (RSUs) to help retain talent – with awards often vesting in two equal instalments, subject to continued employment.

By reducing this offering, Disney is reportedly looking to ensure its hiring and compensation remains competitive and aligned with the broader technology marketplace.

This trend has also been seen across other leading tech companies – such as Meta. 

In February, the Financial Times reported that the company had reduced its annual distribution of stock options by around 5% for most of its staff, after cutting its stock award by 10% in 2025. 

The decision was reportedly made following Meta’s significant investments in AI – with the company forecasting in its 2025 earnings report that its capex costs could double in 2026. 

Reductions in headcount

Disney’s reported reduction of stock options follows the announcements of significant layoffs across the company – particularly impacting marketing, publicity and home entertainment teams. 

In a company memo, Josh said the decision was made to help the company streamline operations to “ensure we deliver the world-class creativity and innovation our fans value and expect from Disney.”

“Given the fast-moving pace of our industries, this requires us to constantly assess how to foster a more agile and technologically-enabled workforce to meet tomorrow’s needs,” he continued. 

These are the first layoffs led by Josh, who took over as CEO on March 18, 2026.

Prior to this, former CEO Bob Iger led a major restructuring, in which the company said it planned to cut around 7,000 jobs in order to save around US$5.5bn in costs and improve overall financial performance following struggling stock prices. 

The company saw its stock price struggle once again earlier in 2026, following a decline in international visitors to its US theme parks and a 35% drop in operating profit for its entertainment unit, due an increased marketing spend. 

Discussing Bob’s impact at Disney, Josh said: “When Bob returned to the company a few years ago, his goal was to fortify our business and lay the groundwork for long-term growth, by reigniting creativity and improving performance at our studios, building a robust and profitable streaming business, transforming ESPN for a digital future and turbocharging our parks and experiences.

“We’ve accomplished all of those things, and we’re operating from a place of strength, with ample opportunity for growth.”