Netflix Discloses Employee Recession as they Experience Subscriber Drop

Photo: Bloomberg

Netflix subscribers are rapidly decreasing for the first time in a decade, and now it has made approximately 150 job cuts.

The redundancy, disclosed on Tuesday, will significantly impact the giant’s US office in California – accounting for 2% of the North American workforce. 

Netflix states that 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, a report from Los Angeles Times states that recruiting, communications and content departments were all impacted.

A few individuals shared their job loss online. 

Netflix’s surprising losses have left the industry in shock. The company is reporting a loss of 200,000 subscribers during its first quarter, and another 2 million are projected to quit by the 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. 

Even with over 220 million subscribers worldwide and still holding the market leader title, Netflix still has experienced tough competition with the emergence of competitor services like Disney Plus, HBO, and Amazon’s 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.

Opinions expressed by Famous Times contributors are their own.