Netflix is laying off 150 workers to cut costs after losing 200,000 users in the first quarter, which could mark the end of an era of continued growth. "The slowdown in revenue also means that we will have to reduce our cost increases," the company said in an internal statement, notes Bloomberg.
"Sadly, we are going to lay off around 150 employees today, mostly in the US," the text continued. At the moment the adjustment is focused on the American market, where it has its global headquarters in Los Gatos, California. According to market calculations, it involves less than 2% of its workforce, with a workforce at the end of 2021 of 11,000 workers.
After experiencing a peak in subscriptions during the confinements of the pandemic, when the planet had to lock itself in their homes, price increases and a return to normal life weigh on customers, who cancel their accounts. To this has been added the departure of Russia, leaving 700,000 users on the road. Netflix also blamed in the last presentation of results the 100 million users who access the service by sharing an account, without paying. The company estimates that another 2 million customers will leave during the current quarter.
According to a company spokesperson told AFP, the changes are motivated purely by "business needs," not individual performance, "which makes them particularly challenging because no one wants to see such good workers go."
With revenues falling, the stock market price reflects the change in trend and the forecast for the evolution of the business. Though it still has 221.6 million subscribers, since its November 2021 high of $701, the stock has fallen more than 70%.
Already late last month, Netflix laid off employees at Tudum, a website that promotes movies and TV shows for its service, as part of a broader restructuring of its marketing department.
To recover revenue, the company has put on the table the possibility of launching a subscription model at a lower cost, but with advertising.
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