Streaming company Netflix has announced plans to eliminate 1,000 positions across the world as it contends with stiffer competition from rival platforms. The reductions are the largest since 2022 and will fall mainly on its human resources, legal, product and technology teams. The company said the cuts equate to around 6% of its total workforce.
Netflix’s co-chief executive, Ted Sarandos, told the Bloomberg Screentime summit last month that the company was “not growing as fast as I want us to”. The job cuts follow that admission and come as the wider industry undergoes consolidation. Paramount’s $110bn (£83.6bn) merger with Warner Bros, the owner of HBO, has reshaped the sector, while free platforms such as YouTube and TikTok keep drawing viewers.
Netflix’s slower growth and industry shake-up
Netflix had come close to its own deal for Warner Bros, but Paramount won out in the end. Investors have been weighing user engagement, meaning how much time customers spend on the service, as Netflix competes with YouTube and TikTok for attention. The firm’s share of viewers’ time is now a central question for the market.
Managers will inform employees whether their roles have been affected soon, according to the company’s email to staff. The message was sent by Sarandos and co-chief executive Greg Peters.
Company pledges continued investment despite layoffs
In the email, Sarandos and Peters said Netflix would keep investing heavily in high-impact areas to improve its service and support growth and innovation. They described the “organisational changes” as necessary, saying the company’s mission to entertain the world required discipline over where it allocates people and resources.
The firm also said it was on track to meet its financial forecasts. Netflix is due to publish its latest results on 20 October, which will show how the company is performing as it reviews its priorities.
Questions over new revenue streams and subscriptions
Netflix has tried to expand beyond its core business, including into gaming and by allowing adverts to play before and during shows and films. Even so, Ross Benes, senior analyst at eMarketer, said the company “haven’t been able to find another line of major revenue”. He added that Netflix still depends heavily on subscriptions, a model that could be approaching a plateau.
Benes said the company would eventually need another revenue stream to diversify, and that this had proved to be the harder challenge. The last major redundancy round at Netflix came in 2022, when about 450 jobs were cut after the firm lost subscribers for the first time in more than a decade.
