SAN FRANCISCO: Netflix on May 17 mentioned it laid off about 2% of its staff in a belt-tightening transfer after growth slowed on the once-booming streaming tv service.
“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,” a spokesperson instructed AFP.
About 150 workers have been laid off, most of them within the United States, the spokesperson mentioned, including that Netflix additionally lower spending on contractors.
The strikes got here simply weeks after Netflix reported that it misplaced subscribers for the primary time in additional than a decade.
“Our slowing revenue growth means we are also having to slow our cost growth as a company,” the spokesperson mentioned.
Netflix ended the primary quarter of this 12 months with 221.6 million subscribers, barely lower than the ultimate quarter of final 12 months.
The firm blamed the quarter-over-quarter erosion to suspension of its service in Russia due to Moscow’s invasion of Ukraine.
A drop of simply 200,000 customers – lower than 0.1% of its whole buyer base – was sufficient to ship Wall Street panicking when Netflix reported quarterly earnings in April.
Chief monetary officer Spence Neumann mentioned on an earnings name that Netflix can be “pulling back” on spending for the subsequent two years, whereas persevering with to make investments billions of {dollars} within the platform.
The Silicon Valley tech agency reported a web revenue of US$1.6bil (RM7.03bil) within the not too long ago ended quarter, in contrast to US$1.7bil (RM7.47bil) in the identical interval a 12 months earlier.
Netflix believes that components hampering its growth embody subscribers sharing accounts with folks not residing of their properties.
The streaming big estimated that whereas it has practically 222 million households paying for its service, accounts are shared with greater than 100 million different households not paying subscription charges.
Netflix is testing methods to generate profits from folks sharing accounts, reminiscent of by introducing a function that lets subscribers pay barely extra to add different households.
“When we were growing fast it wasn’t a high priority and now we’re working super hard on it,” chief government Reed Hastings mentioned of account sharing throughout an earnings name.
“These are over a hundred million households that already are choosing to view Netflix; they love the service, we’ve just got to get paid in some degree for them.”
Another issue crimping Netflix growth is intense competitors from titans reminiscent of Apple and Disney.
Netflix is taking a look at including a lower-priced subscription tier subsidised by promoting, a mannequin that Hastings had lengthy snubbed. – AFP
