Netflix continues to lose subscribers and lay off 300 employees
Netflix is once again laying off employees due to a decline in user numbers. Employees in the United States are primarily affected, however specific jobs worldwide are also affected. As a result, the company is adjusting to lower sales growth in the first quarter of 2022.
Netflix's financial report for the first quarter of 2022 sent shivers through the industry: the firm lost customers for the first time in ten years.
While some analysts are already discussing the impending Netflix crash, the company is attempting to mitigate the damage with employee layoffs.
Following the layoff of approximately 150 employees by Netflix in May 2022, a second wave is now underway. Around 300 employees must be let go, mostly in the United States but also in other countries. Bao Nguyen, a company spokeswoman, told Variety's editorial team:
"Sadly, we had to lay off around 300 staff today. We made these adjustments to allow our costs to rise in relation to our slowing revenue growth while we continue to invest extensively in our business. We are appreciative for everything they have done for Netflix and are working hard to help them through this difficult transition phase."
So, according to Netflix, the job layoffs are directly tied to the loss of subscribers: costs (in this case, staff costs) must be adjusted for lower sales in order for the firm to continue to grow.
Netflix previously lost over 70% of its market value after it was revealed that the streaming service had lost approximately 200,000 members in the first quarter of 2022. Furthermore, the company anticipates losing another two million members in the second quarter.
Netflix should now be able to maintain a profit margin of 20% as a result of the layoffs. The budget for films and series in 2022 is estimated to be $17 billion, the same as in 2021.
The following months will reveal if the corporation can stand up to increased competition from Disney, Paramount, HBO, and others.
Post by: Bryan C.
