It looks like some changes are happening over there at Netflix. On Tuesday, it was reported that the streaming company has laid off at least 150 employees as their revenue is starting to grow at a slower pace.
According to Forbes, a spokesperson for the company made it clear that the recent layoffs had nothing to do with individual performance, and it was strictly based on business needs and slow revenue growth. The spokesperson said, “none of us want to say goodbye to such great colleagues.” They added that the company has intentions “to support them through this very difficult transition.”
Forbes notes that within the first quarter, Netflix reported that it lost around 200,000 subscribers, and they are expecting to lose an additional 2 million during this quarter. With the loss of subscribers, the company’s stock has also decreased by nearly 35%.
Password sharing has been named as one of the factors that have led to the loss of subscribers. The streaming service believes nearly 100 million households around the world share passwords, with 30 million of those households being located in the U.S. or Canada.
When it comes to attracting more subscribers, Reed Hastings, the co-CEO of Netflix, says that are considering launching the ad-supported subscription option, which was first mentioned back in April. They are also considering a program that would allow users to pay for additional profiles they can share, which is similar to a system they tested in Chile, Costa Rica, and Peru where account holders were charged a fee for sharing their passwords with others outside of their households.
A spokesperson from Netflix also spoke to The Hollywood Reporter about the recent layoffs and said,
“As we explained on earnings, our slowing revenue growth means we are also having to slow our cost growth as a company. So sadly, we are letting around 150 employees go today, mostly U.S.-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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TSR STAFF: Jade Ashley @Jade_Ashley94