Netflix announced job cuts of around 300 employees in the second round of layoffs as the streaming giant continues to struggle with slower revenue growth. The Las Gatos-headquartered company reported the loss of subscribers earlier this year for the first time in around a decade. A previous layoff round impacted the jobs of around 150 employees and several contractors in May.
According to Variety, Netflix’s fresh layoff impact “many different teams” but the workers severely hit by the layoffs are in the US. Some international roles have also been cut, The Verge said, citing Netflix spokesperson Bao Nguyen. “Today we sadly let go of around 300 employees,” Nguyen was quoted as saying. “While we continue to invest significantly in the business, we made these adjustments so that our costs are growing in line with our slower revenue growth.”
During its Q1 earnings call, Netflix CEO Reed Hastings announced the company lost 200,000 subscribers for the first time in over a decade and introduced a series of measures that are aimed at minimising the slump and boosting the revenue of the company. The company’s projection at the time suggested a further drop in subscribers. Netflix said it could lose 2 million more users in the upcoming quarter.
Netflix blamed password sharing for the loss in paying subscribers, so it launched a mechanism that requires users who share passwords with accounts in different locations to pay. The feature is currently being piloted in a few markets, but Netflix wants it to be available globally to curb password sharing. Netflix also said that it will invest in content and production aggressively now, especially at a time when it faces stiff competition from the likes of Disney+, Apple TV+, and Amazon Prime Video. Content has emerged as a major issue that Netflix needs to improve, but other factors such as the Russian invasion of Ukraine that led to a ban on Netflix in Russia were also responsible for the dip in subscribers count.
For now, the company is streamlining its growth and it is likely that more layoffs are on the cards, though Nguyen did not say anything about any additional job cuts. However, according to The Hollywood Reporter, Hastings and co-CEO Ted Sarandos told the company staff that it plans to “return to a more normal course of business going forward” in an email.
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