Netflix’s subscriber numbers have been decreasing for a while now. As a result, the company just announced that they’re making approximately 150 staff members redundant to try and cut costs.
Tuesday’s announcement indicates a significant impact on the company’s US office in California – composing about 2% of the North American labor force.
As per Netflix’s statement, the job redundancies resulted from the company’s profit plummeting. As a result, it faces a massive drop in its viewers this year.
“These changes are primarily driven by business needs rather than individual performance, which makes them especially tough as none of us want to say goodbye to such great colleagues,” said the giant in a statement.
No further details about which parts of the business would experience job recessions. However, Los Angeles Times says the affected parts of the company include recruiting, communications and content departments.
A few individuals shared their job loss online.
Netflix blew the industry by surprise as it revealed in April that it had undergone a loss of 200,000 subscribers within three months and projected another 2 million would quit next quarter.
The announcement brought an investor sell-off, with the company’s stock dropping 35% in one day. It is currently trading at $190, a 46% plunge from its former premium.
While the streaming giant still holds the market leader title thanks to 220 million subscribers worldwide, it has been experiencing tough competition with the emergence of services like Disney Plus, HBO and Amazon Prime Video.
Last month, in its earnings report, Netflix also stated that the conflict in Ukraine and the choice to hike its prices in the US had caused the loss of its subscribers. Moreover, withdrawing from the Russian market solely had lost the platform 700,000 users.
In addition to the job redundancies, the firm is also trimming content and ramping down on its own creations. In early May, it halted the making of Pearl, an animated series made by Meghan Markle, in its measure to reduce costs.
A few analysts state that following the soar in sign-ups during the pandemic, Netflix now has dried up in finding trouble-free ways to develop business growth.
The giant says it’s seeking a less expensive, ad-based model and considering clamping down on password sharing, which has cost it 100 million households.
Netflix is not the only firm that is making job recessions. Over the past few weeks, an array of US tech firms, from emerging to established ones like Uber and Twitter, have stated that they are slacking off or halting hiring or, such as online car sales company Carvana, reported job cuts, pointing out a setback.