Netflix is cutting 1,000 jobs globally, marking its most significant workforce reduction since 2022, as the streaming giant grapples with increased competition.
The layoffs will primarily impact teams in human resources, legal, product, and technology, representing approximately 6% of Netflix's total workforce.
Last month, Netflix co-chief executive Ted Sarandos stated at the Bloomberg Screentime summit that the company's growth was not meeting his expectations. The streaming industry is currently undergoing a period of consolidation, highlighted by the $110 billion merger of Paramount and Warner Bros (owner of HBO), while free platforms like YouTube and TikTok continue to draw viewers.
In a communication to staff, Sarandos and co-chief executive Greg Peters affirmed that Netflix would "continue to invest aggressively in high-impact areas to improve our service and further drive growth and innovation."
Netflix had reportedly been close to a deal with Warner Bros but was ultimately outbid by Paramount.
Regarding these "organizational changes," Sarandos and Peters explained, "Our mission - to entertain the world - is ambitious, and delivering on it requires us to be disciplined about where we prioritise our people and resources."
Employees will be informed by their managers about job status "soon."
The company anticipates meeting its financial forecasts, with its latest results scheduled for release on October 20.
Investors are closely monitoring user engagement, specifically the time customers spend on Netflix, as it competes with platforms like YouTube and TikTok.
Netflix has continued to produce content, with its popular underwater mystery series "Below" currently a top performer.
Additionally, the company has been exploring business expansion, including ventures into gaming and the introduction of advertisements before and during its programming.
However, Ross Benes, senior analyst at eMarketer, noted that Netflix "haven't been able to find another line of major revenue." He added that the company's reliance on its subscription model may be approaching a saturation point.
"Eventually, because they're nearing a ceiling with that, they'll need another revenue stream to diversify, and that's where it's been more of a struggle," he commented.
The previous major round of redundancies at Netflix occurred in 2022, when approximately 450 jobs were eliminated following the company's first subscriber loss in over a decade.
