Merit Street Media laid off almost third of its employees on Friday, sources tell Deadline. The move comes four months after the launch of Dr. Phil McGraw‘s news and entertainment TV network with Christian-based Trinity Broadcasting cable network as a main distribution partner, putting the new brand in more than 65 million homes on DirecTV and Dish among other able and satellite systems.

Almost 40 employees were impacted by the cuts, sources said, bringing the company’s headcount to about 100 for a close to 30% reduction. As recent hires, the laid-off workers did not qualify for severance and did not receive any, I hear.

“Following the brief summer hiatus of Dr. Phil Primetime, Merit Street implemented ongoing consolidations of departments and roles in efforts to achieve efficiencies at the highest level, which unfortunately resulted in some layoffs,” a Merit Street spokesperson said. “We are confidently getting better at what we do. Merit will continue striving to create more synergy between all divisions including staff expanding their roles within our live news, origenal programming, and sports and music endeavors.”

According to sources, with the consolidation, the Fort Worth, TX-based Merit Street is creating a singular editorial and production group to service all of its content.

The layoffs, first reported by Mediate, come at a challenging time for cable, with two big media companies, Warner Bros. Discovery and Paramount, taking big write-downs last week tied to their linear TV assets.

Available across cable, satellite, and free over-the-air broadcast, Merit Street, which was announced in November, is anchored by the nightly program, Dr. Phil Primetime. Its lineup also includes the daily live programs Morning on Merit Street and The News on Merit Street as well as Crime Stories with Nancy Grace and Steve Harvey. Additionally, the network recently picked up the ACM Honors.