Netflix, with Slowing Growth Rate, to Lay Off Around One Thousand People
Digital streaming giant Netflix has decided to cut approximately one thousand jobs from its workforce due to slowing revenue growth and a decline in its growth rate.
Faced with slowing growth rates and changing market dynamics, digital streaming platform Netflix has announced that it will part ways with approximately 1,000 employees, corresponding to 6 percent of its workforce.
Background of the Layoff Decision
Global digital streaming platform Netflix announced that it will lay off approximately 1,000 people, corresponding to 6 percent of its workforce, due to the slowdown in its growth rate.
Note Sent by Executives to Employees
In an internal memo penned by the company's co-CEOs Ted Sarandos and Greg Peters, it was stated that the mission to entertain the world is ambitious and that there must be discipline in prioritizing resources.
Decline in Revenue and Growth Rates
Sitting at the top of the video streaming market, Netflix cannot sustain its past growth speed. While revenues increased by 13.4 percent year-on-year in the second quarter, this rate lagged behind the 16.2 percent rate in the first quarter.
The company, headquartered in Los Gatos, California, projected 11.7 percent growth for the completed third quarter.
Viewing Times and Market Analyses
Various media outlets reported that after uninterrupted years, there has been a drop in the time spent on the platform. According to Bloomberg, in early July, it was recorded that average viewership ratings for a series decreased after the first season.
Emarketer analyst Ross Benes stated that Netflix's layoffs show even the largest streaming companies are not immune to stagnation and noted that the company could take cost-oriented steps.