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Netflix lays off about 1,000 employees in biggest cutback to date
The streaming giant trims 6 per cent of its workforce to sharpen its focus, insisting its business is strong and on track for its full-year forecast
CALIFORNIA: Netflix is swinging the axe, and it is doing so from a position of strength. The world’s biggest premium streaming provider is laying off around 1,000 employees, about 6 per cent of its workforce, in its biggest layoff to date. The message from the top is calm and clear: the business is strong, growing and on track.
Most of the cuts will fall on product, technology, legal and HR teams, co-chief executives Ted Sarandos and Greg Peters wrote in an email to employees on Wednesday morning. “Our mission, to entertain the world, is ambitious, and delivering on it requires us to be disciplined about where we prioritize our people and resources,” the pair said in the memo, a copy of which was obtained by Variety. A Netflix spokesperson said the company had no comment beyond the memo.
A strong business, a sharper focus
The cuts come from a company with plenty to be proud of. Netflix has more than 325 million customers globally and has posted double-digit growth in both revenue and profits in recent years. In 2025 it booked $45.2 billion in revenue (up 16 per cent) and net income of $11 billion (up 26 per cent). Profit grew faster than sales, and net income came to almost a quarter of revenue.
Investors, however, have fretted over one number: engagement per user, which slowed in the first half of 2026. Netflix’s answer is discipline rather than retreat. “Our business is strong and growing, and we remain on track to deliver our full-year forecast,” Sarandos and Peters said. For 2026, Netflix projects revenue of $51.0 billion to $51.4 billion (up 13 per cent to 14 per cent) and an operating margin of 31.5 per cent (versus 29.5 per cent in 2024).
The co-chief executives were explicit that the spending will go on. “We’ll continue to invest aggressively in high-impact areas to improve our service and further drive growth and innovation,” they said. “However, doing that means making focused choices across the business so we can keep delivering for our members, partners, employees, and investors.”
Scale and precedent
As of the end of 2025, Netflix had about 16,000 full-time employees, so a 6 per cent cut matches the figure of roughly 1,000 jobs. The last major layoffs came in 2022, when Netflix axed about 450 staffers after a net decline of 200,000 subscribers in the first quarter of that year, its first such drop in more than a decade. The company has made smaller cutbacks since, including letting go several dozen members of its global product team earlier in 2026.
The contrast with 2022 is worth noting. Then, the trigger was a shrinking subscriber base. This time, the company points to a business that is growing, with revenue and profit both rising, and frames the move as a reallocation of people and resources towards high-impact areas.
The numbers to watch
The timing puts the spotlight on Netflix’s third-quarter results, due on Tuesday, October 20, after market close. In the second quarter, the streamer posted earnings in line with Wall Street forecasts, with revenue up 13.4 per cent year-on-year to $12.6 billion and an operating margin of 33.4 per cent (down from 34.1 per cent in the year-earlier period). Netflix did, however, issue third-quarter revenue guidance below analyst expectations, which pushed the share price down.
Shares were down 1.4 per cent in trading as of 11:30 a.m. ET on Wednesday, at $69.45 a share, amid a decline in the broader market.
The memo from Sarandos and Peters to Netflix staff
Team: We wanted to share that we are making a number of organizational changes and, as a result, we’ll be letting go of roughly 6% of our colleagues, with the greatest impact to our product, tech, legal, and HR teams.
Decisions like these are never easy, and we don’t take them lightly. Our top priority today is to support those who are leaving Netflix. The process will vary somewhat by country, but leaders will be connecting with impacted employees soon. If you are leaving, please know that we will support you throughout this transition and make sure you have as much clarity and context as possible. We also want to say thank you. What you’ve built, and the care you brought to Netflix, have made a lasting difference and we will always be grateful.
For the rest of the team, we know you have questions, too. Our mission, to entertain the world, is ambitious, and delivering on it requires us to be disciplined about where we prioritize our people and resources. Our business is strong and growing, and we remain on track to deliver our full year forecast. We’ll continue to invest aggressively in high impact areas to improve our service and further drive growth and innovation. Doing that means making focused choices across the business so we can keep delivering for our members, partners, employees, and investors.
We know changes like this are tough, but let’s stay focused. This is one of the most dynamic times in the history of entertainment, and it’s a moment perfectly suited to a company like ours that’s built at the intersection of technology and entertainment. Now it’s on us to step up and meet the moment, together, like we always do.
Ted and Greg
