**Netflix** is cutting around 1,000 jobs, about 6% of its total workforce. The move marks its largest workforce restructuring since 2022 and comes as **YouTube** and **TikTok** intensify their competition for viewers’ attention.
Key points
Netflix is cutting around 1,000 jobs, mainly in product, technology, legal, and human resources.
Co-CEOs Ted Sarandos and Greg Peters told employees that “the annual guidance remains on track.”
Analysts say that with the rise of the newly merged Skydance, Netflix has still failed to secure a “second revenue stream.”
Details of Netflix’s restructuring
In a statement released Wednesday, Netflix said the cuts would be concentrated mainly in its Product, Technology, Legal, and HR teams. The company said it had about 16,000 full-time employees as of the end of 2025, and that the layoffs would affect teams across its global operations. The details were shared in an email to employees from co-CEOs **Ted Sarandos** and **Greg Peters**.
In the email, the two CEOs stressed that fulfilling the company’s mission would require “tough choices” about where to allocate its people and resources. They said Netflix would continue to invest aggressively in “high-impact areas” while sharpening its focus across the business. They also reiterated that the annual outlook they issued this year remains “on track.”
The restructuring was announced less than a week before Netflix’s third-quarter earnings report, scheduled for October 20. Earlier reports had said Netflix was preparing to cut about 5% of its total workforce, meaning the actual number of layoffs turned out to be higher than expected.
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Doubts about Netflix’s growth prospects
Investors are focused on “Netflix’s next growth driver.” In an interview, **Ross Benes**, a senior analyst at research firm eMarketer, noted that Netflix remains overly reliant on its subscription model, a market that is entering maturity. He added that Netflix is struggling to find another major source of revenue.
Netflix’s failure earlier this year to acquire the studio and streaming assets of **Warner Bros. Discovery** is also seen as an event that deepened market doubts about its strategy. The company’s bid to secure major content IP and distribution capabilities in one fell swoop fell through, leading analysts to say that its future M&A strategy may also be constrained.
In a report, Needham analyst **Laura Martin** said the newly formed **Paramount Skydance** would pose Netflix’s strongest threat. Skydance was formed through the merger of **Paramount Skydance** and Warner Bros. Discovery, and is leveraging economies of scale with an annual content investment budget of $30 billion.
Netflix shares have fallen about 40% over the past year. Many attribute the decline to a combination of concerns about slowing growth, intensifying competition, and delays in developing new revenue streams.
Sarandos himself has acknowledged that growth is slowing. Speaking recently at a Bloomberg event, he admitted, “The pace of growth today is below what I’d like,” while stressing that “the business itself remains healthy and continues to grow steadily.” Netflix has been investing in new revenue streams, including lower-priced ad-supported plans, cracking down on account sharing, and its gaming business. But the prevailing view is that it has yet to build the “second pillar” the market expects.
This is the first time Netflix has cut its workforce on this scale since 2022. That year, after experiencing its first subscriber decline in more than a decade, Netflix laid off about 450 employees in two rounds. Restructuring has continued since then, with smaller workforce adjustments, including dozens of additional cuts in February to its Product organization, which has about 6,000 employees.
In the short term, Netflix’s strategy is to protect profitability by improving cost efficiency. Over the long term, however, it must contend with competition from short-form platforms such as YouTube and TikTok, traditional media, and major content producers and distributors such as Skydance. The market is watching closely to see whether this restructuring will transform Netflix’s business or signal that its growth has stalled.
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