Netflix cuts 150 jobs amid slowdown
Layoffs represent about 2% of the company's workforce
LOS GATOS >> Netflix has chopped about 150 jobs — including more than 100 in Los Angeles — to cope with a drastic slowdown in the growth of the streaming pioneer's revenue amid increasingly fierce competition in its primary markets.
The job cuts represent about 2% of the Los Gatosbased tech titan's worldwide workforce.
At least 106 of the job cuts are located at the Netflix offices in Los Angeles, according to an official filing by the company with state and local government officials.
“The mass layoff is expected to be permanent,” Netflix stated in the filing with the Employment Development Department (EDD). “The employees do not have bumping rights and are not represented by a union or other bargaining unit representative.”
The effective date of the job cuts was May 17, although a letter from Netflix to the state EDD indicated that some job cuts began as early as April 28, public records show.
“Our revenue growth has slowed considerably,” Netflix said in comments about the company's finances for the Januarythrough-march first quarter of 2022, according to a filing with the Securities and Exchange Commission.
Netflix also reported a slump in subscribers and forecast that even more would exit the streaming service.
At the end of December, Netflix served 221.84 million subscribers. But at the end of March, the company served 221.64 million subscribers, a decline of 200,000 customers.
Netflix predicted that its subscriber base would drop to 219.64 million by the end of June 2022, a decrease of 2 million subscribers.
The company said it's facing revenue headwinds on multiple fronts as well as fast-expanding competition.
“Competition for viewing with linear TV as well as Youtube, Amazon, and Hulu has been robust for the last 15 years,” Netflix said in the SEC filing.
The competitors now include well-heeled entertainment titans such as ABC owner Disney, NBC owner Comcast and CBS owner Paramount.
“Over the last three years, as traditional entertainment companies realized streaming is the future, many new streaming services have also launched,” Netflix said in the regulatory documents.
The company's current headwinds weren't easily identifiable earlier due to the boom in streaming activity during the two years of coronavirus-linked lockdowns and business shutdowns, which caused more people to stay home — and to binge-watch television shows and movies.
Complicating matters is the big increase in sharing of accounts by primary subscribers.
“It's harder to grow membership in many markets,” Netflix said, “an issue that was obscured by our COVID growth.”