Netflix’s revelation that it lost 200,000 subscribers in the first quarter put further pressure on an already beleaguered tech sector, but top tech analyst Mark Mahaney believes the current weakness in the sector presents several opportunities for investors.
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Netflix is laying off around 150 employees across the company, CNBC confirmed Tuesday.
The eliminated positions represent less than 2% of the streamer’s 11,000 staffers, with most of the cuts happening in the U.S.
“As we explained on earnings, our slowing revenue growth means we are also having to slow our cost growth as a company,” a representative from the company told CNBC. “So sadly, we are letting around 150 employees go today, mostly US-based. 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. We’re working hard to support them through this very difficult transition”.
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The staff reductions, which were expected, come less than a month after Netflix reported its first subscriber loss in a decade and forecast future losses in the next quarter. Shares of the company are down more nearly 70% since January.
During the company’s earnings last month, co-CEO Reed Hastings said the company is exploring lower-priced, ad-supported tiers in a bid to bring in new subscribers after years of resisting advertisements on the platform.
Netflix is also working to crack down on rampant password sharing, noting that in addition to its 222 million paying households, there are more than 100 million additional households through account sharing.
Netflix’s layoffs, while tied to its slowdown of subscribers, are part of a larger contraction of jobs within the tech industry. Several tech companies have recently announced hiring freezes and layoffs including Facebook parent company Meta, Amazon, Uber and Robinhood.