Netflix cuts 1,000 jobs amid pressure from YouTube and TikTok

Netflix cuts 1,000 jobs amid pressure from YouTube and TikTok

LOS GATOS, California: Netflix is cutting roughly 1,000 jobs as the streaming company trims its workforce amid growing competition for viewers from traditional media rivals and platforms like YouTube. The layoffs amount to about 6 percent of Netflix's workforce and are its biggest cuts since 2022, according to an internal memo seen by Reuters. Most of the reductions will affect the company's product, technology, legal, and human-resources teams, according to an email Co-CEOs Greg Peters and Ted Sarandos sent to employees on October 14.

"Our mission — to entertain the world — is ambitious, and delivering on it requires us to be disciplined about where we prioritize our people and resources," they said in the memo. "Our business is strong and growing, and we remain on track to deliver our full-year forecast." The streaming company has faced questions this year about whether it can sustain the growth that helped reshape the U.S. media industry and put pressure on traditional cable television businesses.

The time subscribers spend watching Netflix has become a particular concern for investors as YouTube and TikTok compete for viewers with free, user-generated content that gives them a cost advantage. Netflix's failed attempt to acquire Warner Bros. Discovery's streaming and studio assets earlier this year also raised questions about its strategy.

Paramount completed its US$110 billion acquisition of Warner Bros. earlier this month to form Skydance. "They haven't been able to find like another line of major revenue," said Ross Benes, senior analyst at eMarketer, adding the company remains dependent on a subscription business that could be approaching a ceiling.

"Eventually, because they're kind of nearing a ceiling with that, they'll need another revenue stream to diversify, and that's where it's been more of a struggle." Netflix has been trying to expand beyond subscriptions by investing in an advertising tier, live programming, and gaming. The company's previous major round of layoffs came in 2022, when it eliminated about 450 jobs in two rounds after losing subscribers for the first time in more than a decade. The Wall Street Journal first reported the memo released on October 14.