Netflix is cutting approximately 1,000 jobs, or 6% of its workforce, in its largest reduction since 2022. The cuts target HR, legal, product, and tech teams as the company faces slowing revenue growth and increased competition.
Netflix has announced it will cut approximately 1,000 jobs globally, representing about 6% of its total workforce. This marks the streaming giant's steepest reduction since 2022, driven by slowing growth and intensifying competition in the video streaming market.
The layoffs will primarily impact employees in human resources, legal, product, and technology teams. In an internal email to staff, co-chief executives Ted Sarandos and Greg Peters stated that the company needs to be "disciplined about where we prioritise our people and resources" to deliver on its mission to "entertain the world."
The executives emphasized that Netflix would "continue to invest aggressively in high-impact areas to improve our service and further drive growth and innovation." Managers are expected to inform affected employees of their status "soon."
The decision comes as Netflix faces slower revenue growth. In the second quarter, revenue rose 13.4% from the same period a year ago, a slowdown from the 16.2% growth rate recorded in the first quarter. The company is forecasting 11.7% growth for the just-finished third quarter.
Netflix is also contending with increased competition from rivals and free platforms. The streaming industry has seen consolidation, including Paramount's $110bn merger with Warner Bros, while free platforms such as YouTube and TikTok continue to attract viewers. Ross Benes, a senior analyst at eMarketer, noted that Netflix remains reliant on a subscription business that "could be approaching a plateau," adding that the company has struggled to find another major revenue stream.
Netflix shares have faced pressure amid concerns about user engagement and slowing revenue. According to Yahoo Finance, shares slid about 1% in recent trading, leaving them down 25% for the year and over 40% in the last 12 months. However, Channel News Asia reported that the company's stock has fallen 15% since the start of the year. Due to this discrepancy in year-to-date figures, the specific percentage decline for the current year is omitted here, though the 12-month decline of over 40% is supported by multiple sources.
Despite the layoffs, Sarandos and Peters stated that Netflix remains on track to meet its financial forecasts. The company is scheduled to report its third-quarter earnings on 20 October.
The layoffs signal a shift in Netflix's strategy as it moves from rapid expansion to prioritizing efficiency and engagement. With subscriber growth slowing and competition from both traditional media mergers and free social platforms, Netflix is restructuring its workforce to focus on high-impact areas. This move highlights the challenges facing even the leading streaming services as they seek to diversify revenue beyond subscriptions while maintaining profitability.
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
The day's checked news, by email
One short email a day with the top stories. Free, and you can unsubscribe in one click.
Or follow for the latest news:
No comments yet. Start the discussion.
EntertainmentTrending
Bon Jovi has announced seven new dates for their Forever Tour in 2027, including a concert at Toronto's Rogers Stadium on Aug. 4. The tour follows sold-out residencies in New York and London.
EntertainmentTrending
An inquest at East Sussex Coroner’s Court has found that Trevor Dietz, manager of the band Fontaines DC, died by suicide on June 7. The court heard he had struggled with mental health issues and distress over global events.