Netflix Prepares Layoffs Affecting About 5% of Staff Ahead of Q3 Results
Netflix is preparing to cut approximately 5% of its workforce, which could impact roughly 800 employees, according to Puck. An announcement is expected as early as next week, ahead of its third-quarter results on October 20.
Background
This potential restructuring comes three months after Netflix provided a soft forecast for the third quarter, sending its shares down 9%. The company had approximately 16,000 full-time employees at the end of last year.
Competition and Adaptation
The move follows increased competition from rival media groups merging and YouTube gaining a larger share of viewing time and advertising revenue. YouTube has even started paying creators directly to keep their shows off Netflix. As per Nielsen, YouTube accounted for 14.2% of US TV viewing time in July, nearly doubling Netflix’s 7.8%.
In response, Netflix has diversified into advertising, live events, and games, with its advertising revenue expected to double this year to around $3 billion. The company has also emphasized the integration of AI skills across all teams.
Upcoming Announcements
Netflix's co-chief executives, Greg Peters and Ted Sarandos, will discuss the third-quarter results in a video interview on October 20, likely providing investors with the first insights into the planned layoffs.
By Ana Maria Constantin, an expert in digital marketing, product management, and branding & identity.