October 15, 2026
Netflix intends to lay off about 6% of its workforce, equivalent to approximately 1,000 employees, in the largest wave of job cuts the company has witnessed since 2022. This came according to an internal memo seen by Reuters, and sent by co-CEOs Greg Peters and Ted Sarandos to employees on Wednesday.
The letter explained that the bulk of the layoffs would affect the product, technology, legal affairs, and human resources teams. Peters and Sarandos stressed in the memo that the company’s business is “strong and growing,” and that “Netflix” is still on track to achieve its expectations for the full year, noting that “our mission to entertain the world is ambitious, and achieving it requires us to be disciplined in setting our priorities in terms of people and resources.”
On the financial front, the company’s shares rose 0.7% on Wednesday, although they are still down about 25% since the beginning of the year. Netflix, which employed about 16,000 people at the end of last year, conducted its last major wave of layoffs in 2022, when it eliminated about 450 jobs in two phases after recording the first decline in the number of subscribers in more than a decade.
This year, the company faces increasing questions about its ability to maintain the pace of growth, in light of mounting investor concerns about interaction rates and the time users spend on the platform, competing with platforms such as YouTube and TikTok, which attract the audience with free user-generated content that gives it a cost advantage. Doubts about the company’s strategy also increased following the failure of its attempt to acquire the broadcast assets and studios of Warner Bros. Discovery earlier this year, at a time when Paramount completed earlier this month a $110 billion acquisition of Warner Bros. to form the Skydance entity.
In this context, Ross Bennis, chief analyst at eMarketer, said that Netflix was unable to find another major source of revenue, pointing to its heavy reliance on the subscription model, which may be approaching its ceiling, stressing that the company will need an additional source of revenue to diversify its business and face its most prominent challenges.
In an attempt to expand its revenue streams outside the traditional subscription model, the platform is investing in ad-supported packages, live programming, and games. It is noteworthy that the Wall Street Journal was the first to reveal the content of this internal memo on Wednesday.
