Netflix Cuts 1,000 Jobs as Ad Revenue Forecast Drops
Netflix reduced its workforce by 6 percent and lowered its advertising forecast after reporting slowing revenue growth and a weak profit outlook.
Netflix reported quarterly revenue of $12.9 billion, a 12 percent year-over-year increase that met company forecasts but signaled a slowdown from the 17.2 percent growth seen a year ago. Shares fell nearly 6 percent in premarket trading following the report, contributing to a yearly decline of more than 26 percent that potentially erased $17 billion in market value. The company also lowered its 2026 advertising revenue forecast by 10 percent and provided a weak profit outlook for the fourth quarter.
In response to slowing viewership and competition from short-form content platforms like TikTok and YouTube, the company laid off approximately 1,000 employees, representing 6 percent of its workforce. The restructuring included the departures of content chief Bela Bajaria and film division head Dan Lin. Former Disney executive Peter Rice will oversee the film divisions in the interim.
Co-CEOs Greg Peters and Ted Sarandos defended the layoffs as necessary discipline. Sarandos stated the company will focus on its core business of producing quality TV shows and movies to ensure the service remains essential, specifically noting a need to refocus on the slowing U.S. market. Following the results, at least 14 brokerages reduced their price targets for the stock.
