Netflix announced on Wednesday that it will cut about 6 percent of its workforce, translating to roughly 1,000 positions, in what the company described as part of broader “organizational changes.” The move marks the streaming giant’s largest round of layoffs in several years.
In a memo to employees, co-CEOs Greg Peters and Ted Sarandos said the cuts would disproportionately affect the company’s product, technology, legal, and human resources departments. They emphasized that the decision was not made lightly but argued that the company must remain “disciplined about where we prioritize our people and resources” as it invests in future growth and “high impact areas to improve our service.”
The memo, obtained by The Associated Press, stressed that Netflix’s business remains robust. However, the company declined to provide additional comment beyond the executives’ statement.
The layoffs come despite a strong financial performance in recent quarters. In the second quarter, Netflix reported net income of $3.4 billion on revenue of $12.56 billion, representing year-over-year increases of 9 percent and 13 percent, respectively. Yet the company’s guidance for the third quarter fell short of Wall Street’s expectations, and it is scheduled to report those results next week.
The streaming landscape has become increasingly competitive. While Netflix still leads the market with a 19 percent share, according to data from streaming guide JustWatch, rivals such as Amazon’s Prime Video and Disney+ are closing in. The competitive pressure has intensified following the recent merger of Paramount and Warner Bros. Discovery, which closed last week in an $81 billion deal. The newly combined entity, Skydance, plans to consolidate its streaming offerings into a single service over time.
Interestingly, Netflix had initially pursued a deal to acquire Warner’s studio and streaming business late last year but walked away from that offer in February. That decision now appears prescient given the company’s current cost-cutting measures.
As of the end of 2025, Netflix employed about 16,000 full-time workers globally, according to regulatory filings. Wednesday’s layoffs are the most significant since the company’s last major reduction in 2020, when it cut around 150 jobs.
The Wall Street Journal first reported the layoffs earlier Wednesday. The move echoes similar workforce reductions across the tech and media sectors, including Kroger’s plan to cut 3,000 corporate jobs as part of its own restructuring.
Analysts note that Netflix’s decision to slim down its workforce while continuing to invest in content and technology suggests a strategic pivot toward efficiency and higher-margin growth areas. The company has been expanding its advertising-supported tier and cracking down on password sharing, moves that have helped boost profits but also require careful resource allocation.
As the streaming wars intensify, Netflix’s ability to adapt will be closely watched. The layoffs, while painful, may be a necessary step to maintain its competitive edge in an increasingly crowded market.
