Netflix lays off 800 employees, 5% of total staff...largest cut since 2022

Netflix has decided to lay off 800 employees, accounting for about 5% of its total workforce. This workforce reduction is the largest since 2022. The Los Angeles Times reported on the 9th (local time) that Netflix plans to cut 800 employees, including the creative team responsible for feature-length content such as movies. Netflix also conducted large-scale layoffs in 2022. At that time, Netflix announced a decline in subscribers for the first time in over a decade and laid off 150 employees and dozens of contractors and part-time workers across several departments, including the social media team, in May. In June, it further reduced its workforce by 300 employees, about 3% of its total staff. There have also been changes in the gaming division. In August, Netflix closed the game studio Night School located in Hollywood, USA, and is in the process of shutting down the game studio Moonroot in Helsinki, Finland. Netflix’s revenue for the first to third quarters of this year showed moderate growth, ranging from approximately $51 billion to $51.4 billion (68 trillion to 68.7629 trillion KRW). First-quarter revenue was $12.25 billion (about 16.388 trillion KRW), and second-quarter revenue was $12.56 billion (about 16.8027 trillion KRW). The second-quarter revenue fell short of the market expectation of $12.58 billion (about 16.8295 trillion KRW). Third-quarter revenue is projected to be approximately $12.86 billion to $12.9 billion (17.2041 trillion to 17.2576 trillion KRW). A slowdown in viewing time growth has also been observed. Netflix’s paid subscriber count remains around 325 million, but the growth rate of total user viewing time has significantly decreased. According to Nielsen, in July, YouTube held a 14.2% share of TV streaming viewing time in the U.S., while Netflix held 7.8%, widening the gap between the two platforms to 6.4 percentage points. In December last year, Netflix reached an all-time high U.S. TV streaming viewing share of 9.0%, boosted by the popularity of ″Squid Game Season 2″ and ″Stranger Things.″ The recent share has dropped by 1.2 percentage points from that peak. Foreign media such as The Wall Street Journal and Bloomberg have pointed to the absence of killer content like ″Squid Game″ and ″Stranger Things,″ YouTube’s expanding TV viewing share, and user migration to free and ad-supported platforms following subscription fee hikes and account sharing restrictions as reasons for Netflix’s share decline. In response to this situation, Netflix is reallocating resources. Instead of maintaining existing platform staff, it is focusing resources on new revenue-generating areas such as ad-supported plans, live streaming and sports broadcasting, short-form content, gaming, and AI. Reuters reported that following Netflix’s ad plan restructuring, the proportion of ad revenue has been steadily increasing, with ad revenue expected to reach approximately $3 billion (4.0134 trillion KRW) this year.