Netflix to cut 1,000 jobs as growth falls short

Cuts mark steepest layoff round at Netflix since 2022

Netflix announced it will eliminate 1,000 positions worldwide, marking the company’s steepest round of layoffs since 2022, when it cut about 450 jobs after losing subscribers for the first time in more than a decade. The latest reductions represent roughly 6% of the streaming service’s total workforce.

In an email to staff, co-Chief Executives Ted Sarandos and Greg Peters said the company would “continue to invest aggressively in high-impact areas to improve our service and further drive growth and innovation.” The reductions will mainly affect teams in human resources, legal, product and technology, according to the email.

Commenting on what they described as “organisational changes,” Sarandos and Peters said: “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.” Managers were expected to inform employees whether their jobs had been cut “soon,” according to the email. The company added that it remained on track to meet its financial forecasts.

The streaming service is due to report its latest quarterly results on 20 October, after which investors will look for evidence of whether the cuts have stemmed concerns about user engagement — the amount of time customers spend on the platform.

The announcement comes amid a period of consolidation in the streaming industry. Paramount completed a $110 billion (£83.6 billion) merger with Warner Bros. Discovery, the owner of HBO, while free platforms such as YouTube and TikTok continue to attract viewers with ad-supported content.

Netflix had come close to its own deal for Warner Bros. Discovery but was ultimately outbid by Paramount.

Last month, Sarandos told the Bloomberg Screentime summit that the company was “not growing as fast as I want us to.” Investors have been weighing user engagement as Netflix competes with platforms such as YouTube and TikTok.

Netflix has been attempting to expand its business through gaming and by allowing advertisements to play before and during shows and films. But those efforts have yet to produce a new pillar of growth, according to Ross Benes, a senior analyst at eMarketer.

“They haven’t been able to find another line of major revenue,” Benes said, adding that the company remains reliant on a subscription business that could be approaching a plateau. “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 said.

The 2022 redundancies, which totaled about 450 positions, followed Netflix’s first subscriber loss in more than a decade. The latest cuts arrive as the streaming sector faces both consolidation and pressure from free, ad-supported competitors, while platforms such as YouTube and TikTok continue to attract viewers.