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Entertainment streaming giant Netflix laid off an additional 300 of their 11,000 worldwide staff on Thursday, following the layoffs of 150 employees, dozens of contractors, and other part-time staff in May. The news was first reported by Variety, citing a statement from a Netflix spokesperson.
Earlier this year, Netflix officials said that they’d lost 200,000 subscribers at the end of the first quarter — the first time the company experienced such a decline in its recent history. They also disclosed that they expected to lose 2 million more subscribers in the second quarter.
The company’s stock has lost a significant amount of its value since these announcements. The stock opened Thursday at $180.50 and was down slightly as of midday. It peaked during this past year at just over $700.
The layoffs come as Netflix faces increased competition for viewers’ dollars as competitors make big investments in their own streaming services. Some major players have emerged:
With increased competition has come higher rates of “churn,” with subscribers at least temporarily canceling some subscriptions while adding others. That means, Netflix has to worry about not just landing new subscribers, but keeping the existing ones.
Concerns from observers are also growing that streaming subscriptions may have peaked. The big question is whether streamers will be able to recapture revenue once generated via other distribution channels, such as advertising, international sales, and theatrical distribution.
And, like other businesses, they also face the growing fears of a possible recession.
The majority of the Neflix layoffs affect U.S. staff. Netflix cited “slower revenue growth” as the reason for the layoffs, looking to keep their costs in line with that adjusted speed.
The company committed in their most recent earnings call to cost-cutting that would keep their profit margins at 20%. They’re not the only streamer making cuts — HBO Max parent company Warner Bros. Discovery, following the acquisition of WarnerMedia, has also made a number of cuts. However, those have been focused on the executive ranks thus far.
We have reached out to Netflix and will update this story if we receive a response.
