Netflix informed job cuts of around 300 employees in the second round of layoffs as the streaming giant struggled with slower revenue growth. Las Gatos-based company reported losing subscribers earlier this year for the first time in around a decade. Several contractors and 150 employees were laid off during a previous round of layoffs in May.
Netflix’s recent layoffs have affected “many different teams,” but those who have been affected the most 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.”
Netflix CEO Reed Hastings announced the company lost 200,000 subscribers for the first time in over a decade during its Q1 earnings call and introduced a series of measures aimed at minimising the slump and improving revenue. 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.
Password sharing was blamed for Netflix’s loss of paying subscribers, so it implemented a mechanism that requires users who share passwords between accounts in different locations to pay. Netflix is currently testing the feature in a few markets, but 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. The content on Netflix has emerged as a major issue that Netflix needs to improve, but other factors such as the Russian invasion of Ukraine, which resulted in a ban on Netflix in Russia, also contributed to the decline in subscribers.
Currently, the company is focusing on streamlining its growth, and more layoffs are likely on the horizon, although Nguyen was mum 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.