Netflix is laying off around 150 agency employees and contractors following a disappointing earnings report, citing ‘slowing revenue growth’, as first reported Variety.
A source close to the situation tells The edge the layoffs include at least 26 staff working at the company’s fan-focused Tudum website, which serves as a supplement to Netflix content. Prior to this recent round of layoffs, Netflix laid off about 25 marketing staff, including nearly a dozen who worked on Tudum. The 26 employees made redundant today were notified of the move by mass email.
The streaming giant has confirmed The edge that most of the employees affected by the layoffs are in the United States. Netflix spokeswoman Erika Masonhall released the following statement in response to The edgenoting that the layoffs were primarily motivated by financial issues rather than performance:
As we explained about earnings, slowing our revenue growth means we also need to slow our cost growth as a business. Unfortunately, we are laying off approximately 150 employees today, mostly based in the United States. These changes are driven primarily by business needs rather than individual performance, which makes them particularly difficult because none of us want to say goodbye to such great colleagues. We are working hard to support them in this very difficult transition. A number of the agency’s contractors were also affected by the news announced this morning. We are grateful for their contributions to Netflix.
Last quarter, Netflix said it lost around 200,000 subscribers – the first time Netflix has lost subscribers in over a decade. It also expects to lose another 2 million in the next quarter. Russia’s invasion of Ukraine is partly responsible for the loss of subscribers, as Netflix shut down its services in Russia in March. Netflix had a low-key quarter with fewer Hollywood blockbusters released on the platform, which didn’t help either.
Spencer Neumann, Netflix’s chief financial officer, said on last quarter’s earnings call that the company would cut spending over the next two years or so.
The streaming giant told employees that a cheaper, ad-supported option would launch later this year, along with a crackdown on password sharing as it tries to kickstart subscriber growth.
Disclosure: The edge is currently producing a series with Netflix.
Additional reporting by Mia Sato.