Netflix announced plans on Wednesday to lay off roughly 1,000 employees, representing 6% of its global workforce, while replacing chief content officer Bela Bajaria with former Disney and 21st Century Fox executive Peter Rice amid slowing domestic engagement and intensified streaming competition.
The streaming pioneer finds itself adjusting strategy after a turbulent period that included an unsuccessful multibillion-dollar pursuit of Warner Bros. assets. While the company remains profitable, leadership acknowledged that growth has not met internal expectations.
Netflix Cuts Staff Across Product and Technology Divisions
The workforce reductions target the company’s product, technology, legal, and human resources divisions. Co-CEOs Ted Sarandos and Greg Peters addressed the cuts in a message to staff.
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.
Ted Sarandos and Greg Peters, Co-CEOs via CNBC
The executives added that the company remains on track to hit its annual forecast while continuing aggressive investments in high-impact areas. The cuts mark the largest workforce reduction at the company since 2022, when subscriber numbers dipped.
In 2025, Netflix achieved a net profit of $11 billion alongside a 16% revenue increase reaching $46.6 billion. However, looking toward the remainder of the year, the streamer projected slower revenue growth between 13% and 14%, while aiming for an operating margin of 31.5% by boosting it by 200 basis points. For the second quarter of 2026, revenue growth in the United States and Canada decelerated to 10% from the prior quarter’s 14%, partly affected by recent price increases. Netflix shares have fallen around 25% over the course of the year amid investor concerns that double-digit gains may be moderating.
The latest job cuts surpassed the 2022 reduction of 450 jobs that followed a first-quarter loss of 200,000 subscribers. Additional reductions occurred in May, when approximately 150 jobs were eliminated, followed by another 300 job cuts in June, out of an approximate total of 11,000 employees.
Leadership Changes and the Search for Buzzy Hits
The departure of chief content officer Bela Bajaria follows a period where the platform broadened its entertainment offerings into live sports, podcasts, and video games. Despite adding some 440 titles in 2025 alone, analysts and executives noted a distinct lack of breakout cultural phenomena comparable to earlier hits like Stranger Things or Squid Game.
Industry observers point to shifting viewer habits as a central challenge. Meanwhile, competitors gained ground, with YouTube claiming over 14 percent of television viewing time, while Disney’s streaming services stood at 4.7 percent and Prime Video at 4.2 percent.
Co-CEO Ted Sarandos noted during the Bloomberg Screentime conference that the company was not growing as fast as desired. Viewing hours increased by 2% during the first half of 2026, while content spending rose 10% toward the $20 billion mark. Film chairman Dan Lin survived the recent round of cuts, though film vice president Doug Belgrad stepped down from his position.
What Peter Rice Inherits at the Content Helm
Incoming content head Peter Rice takes over responsibility for charting the streaming service’s creative direction. Industry analysts noted that the executive changes signal attempts to address broader programming questions. Ted Sarandos stated that he sees opportunities to elevate the streaming slate within the domestic region, focusing on big and buzzy original hits that generate global conversation.
The streaming giant also faces heightened competition from legacy studio consolidations, including the upcoming operations of David Ellison’s Skydance Corp. following the merger of Paramount and Warner Bros. Discovery. With investor scrutiny mounting regarding viewer engagement in the United States and Canada, the incoming leadership team faces the task of realigning the platform’s content output with shifting audience demands ahead of the upcoming quarterly earnings report scheduled for October 20.
Netflix has also experimented with theatrical distribution models for select features, such as Spain’s Oscar submission La Bola Negra, which opened on four screens in Los Angeles and New York and grossed $277,500 before heading to the streaming catalog in December. Additionally, Greta Gerwig’s upcoming film Narnia: The Magician’s Nephew is slated for a 45-day theatrical window prior to its digital release on the platform.
As the company prepares for its upcoming financial disclosures and companywide town hall meetings, leadership continues to emphasize disciplined resource allocation across its remaining business units. The shifting executive structure and ongoing adjustments to content acquisition reflect strategic pivots across the entertainment industry.