Netflix is laying off 150 employees after declining subscribers, with most of the cuts happening in the U.S. The well-known production company and streaming service has over 11,000 employees, so the layoffs represent less than 2% of Netflix's workforce.
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“As we explained in our earnings call, slowing our revenue growth means we also need to slow our cost growth as a company,” a company spokesperson told CNBC. “So, unfortunately, we are letting approximately 150 employees go today, primarily in the U.S..” The spokesperson explained that the layoffs are not related to individual employee performance, but are primarily based on the company’s business needs. This makes the situation even more difficult, since the company doesn’t really want to say goodbye to “such great colleagues.”
"We are working hard to support them through this very difficult transition," the Netflix spokesperson said.
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Netflix lays off 150 employees after subscriber decline
The layoffs were not a surprise and come less than a month after Netflix officially reported a loss of subscribers for the first time in a decade. The first quarter of 2022 proved particularly damaging, as the company lost 200,000 users worldwide. The company even predicted that it could lose up to 2 million subscribers in the second quarter. The shares have also fallen significantly in recent months.
During last month's earnings call, Reed Hastings , one of the company 's co-founders and CEOs , said that Netflix is exploring ways to attract new subscribers.
Netflix is also working to combat uncontrolled ,password sharingnoting that in addition to its 222 million paying households, there are more than 100 million additional households using the service in this way.
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Netflix's layoffs, while tied to its declining subscriber base, are part of a broader job loss in the tech industry . Several major companies have recently announced hiring freezes and layoffs, including Facebook parent Meta , Amazon, Uber and Robinhood.
Business challenges arising from the war in Ukraine, the general macroeconomic environment , and the pandemic are some of the reasons why companies are making staff cuts.
Source: www.cnbc.com
