Netflix fired 150 employees after reporting an unprecedented drop in the number of subscribers

Netflix fired 150 employees after reporting an unprecedented drop in the number of subscribers

The layoffs represent approximately 2% of the company’s workforce in the United States and Canada.

“We are working hard to support you during this very difficult transition,” the streaming giant said in a statement. Netflix said on Tuesday it had laid off about 150 people , most of them in the United States, as the streaming service company grapples with slowing growth.

“These changes are primarily driven by business needs rather than individual performance, making them especially difficult as none of us want to say goodbye to such great colleagues,” the company said in a statement. “We are working hard to support them during this very difficult transition.”

The job cuts come as Netflix reported its first subscriber loss in more than a decade and forecast deeper losses in the coming quarter. He said the war in Ukraine and fierce competition contributed to the loss of customers.

As a result of its declining growth, Netflix said it would introduce a cheaper ad-supported tier and take a closer look at its spending.

“We’re trying to be smart about it and prudent in terms of curtailing some of that spending growth to reflect the realities of business revenue growth ,” Netflix CFO Spencer Neumann told investors during the presentation. company’s most recent earnings. call.

In April, the company said it lost 200,000 subscribers in its first quarter , well below its forecast of adding 2.5 million subscribers . The suspension of service in Russia after the invasion of Ukraine took its toll, resulting in the loss of 700,000 members.

Since warning in January of weak subscriber growth, the company has lost nearly half its value. Lagging subscriber growth is prompting Netflix to consider offering a cheaper, ad-supported version of the service, citing the success of similar offerings from rivals HBO Max and Disney+.

“Those who have followed Netflix know that I have been against the complexity of advertising and am a big fan of the simplicity of subscription,” said Netflix CEO Reed Hastings. “But as much of a fan of that as I am, I’m a bigger fan of consumer choice.”

Netflix offered a gloomy prediction for the spring quarter, predicting it would lose 2 million subscribers, despite the return of long-awaited series like Stranger Things and Ozark and the debut of the film The Gray Man , starring Chris Evans and Ryan Gosling. Hastings told investors the pandemic had “created a lot of noise,” making it difficult for the company to interpret the rise and fall of its subscription business over the past two years. Now , it appears that the culprit is a combination of competition and the number of accounts sharing passwords, making growth difficult.

“When we were growing rapidly, working on that wasn’t a high priority,” Hastings said of the account swap in comments during Netflix’s investor video. “And now we are working very hard on it.”

Melissa Galbraith
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.