2022 has not been a good year for Netflix. The once irreplaceable giant of streaming has suffered a number of setbacks over the past few months as it struggles to adapt to a post-covid world. Now, there is another setback hitting Netflix, as Variety reports the company has laid off a whopping 300 employees.
News had circulated earlier this week that Netflix was planning a swift of job-cuts in order to combat its troubling financial situation. The 300 employees that have been axed are across a plethora of departments in the company and Variety’s report suggests that the bulk of the job cuts came in the United States. In what has been a demanding year for Netflix, this job cut isn’t even the first in 2022 that the company has had to endure. Back in May, Netflix cut 150 staff members from the payroll and CNBC made it clear that the cuts were not employee performance-related.
What is clear, is that this week’s layoffs and the 150 layoffs in May are all related to Netflix’s incredibly poor subscriber and stock market performance in 2022. Just weeks ago, Netflix experienced a share price drop of 5% in just a single day, and in January experienced a single-day drop of 20%. According to the aforementioned CNBC article, Netflix’s share prices have dropped by approximately 70% since the start of the year. Netflix’s troubles aren’t just restricted to the United States. Overseas in the United Kingdom, Netflix is being bested by two of its biggest competitors, Apple TV and Disney+, with both services seeing big boosts in new subscribers in 2022. Netflix however, has seen marginal growth that borders on irrelevant, just 3% in the year’s first quarter, compared to 27% for Apple and 19% for Disney.
Herein lies the source of Netflix’s big problem. Subscriber growth, or the lack thereof, has caused a ripple effect that has contributed to the share price drops and subsequently the staff cuts. In the first quarter, Netflix reported a 200,000 subscriber loss, the first loss recorded for the company in over a decade and at the time of The Verge’s report on the devastating loss, Netflix was forecasting a further subscriber loss of 2 million by the end of the second quarter of this year. Subscribers are the bread and butter for streaming services, they generate the income and drive a platform forward, if subscribers go, then streamers struggle, and hence Netflix is having a difficult year.
300 lay-offs may not seem drastic in an 11,000-strong workforce, but given how recent the previous lay-offs were and the fact that more lay-offs are forecast for the year, the future is looking bleak for the streaming platform. However, in an effort to fight the tide of woe, Netflix still has a grand list of original films and television series set to wow audiences throughout the year and hopefully entice new subscribers to the platform. Hopefully, the likes of Rian Johnson’s Glass Onion: A Knives Out Mystery and The Witcher: Blood Origin stop the Netflix ship from sinking.