Netflix plans to lay off approximately 1,000 employees, or around 6% of its global workforce, as it seeks to adapt to an increasingly competitive environment and sustain its growth. The move, announced on October 14, comes as the streaming industry faces growing competition for viewers’ attention and questions about its ability to develop new revenue streams beyond subscriptions.

Job Cuts Target Key Departments

According to an internal memo from the company’s co-chief executives, Ted Sarandos and Greg Peters, most of the layoffs are expected to affect the product, technology, legal and human resources departments. Netflix’s leadership said the business remains strong and continues to grow, adding that the company remains on track to meet its annual forecast. At the same time, it intends to continue investing aggressively in areas that can have a meaningful impact on its service and future growth.

At the end of 2025, Netflix employed approximately 16,000 full-time workers. Eliminating around 1,000 positions would represent a substantial reduction and the company’s largest round of layoffs since 2022, when it cut approximately 450 jobs in two rounds after reporting a decline in subscribers. This time, the move comes without the company presenting its business as being in an immediate crisis. Instead, it reflects an effort to align its cost structure with strategic priorities.

Competition for Viewing Time Weighs on the Outlook

One of Netflix’s main challenges is maintaining viewer engagement, measured in part by the amount of time people spend watching content on its platform. Services such as YouTube and TikTok offer vast amounts of free content, including user-generated videos. Their business models give them a competitive advantage in the battle for attention, making it harder for subscription-based services to justify their spending on content.

Netflix shares fell approximately 25% from the beginning of 2026 through the time of the report, as the company faced questions about its ability to maintain the growth rates that characterized its earlier expansion. Its attempt to acquire Warner Bros. Discovery’s streaming and studio assets also failed. Paramount ultimately completed the deal, adding further uncertainty around Netflix’s strategic expansion opportunities.

Expanding Revenue Sources Remains a Key Challenge

Netflix is working to broaden its business beyond the traditional subscription model through an advertising-supported subscription tier, live programming and gaming. These initiatives are intended to diversify revenue and strengthen the company’s market position, but it remains unclear whether they can become significant long-term growth drivers.

Investors will monitor upcoming earnings reports, particularly revenue guidance, viewer engagement trends and progress in advertising and live content. Netflix is scheduled to report its third-quarter results on October 20. The figures should help investors assess whether workforce reductions are allowing the company to focus resources on areas with greater potential, or whether competitive pressures will continue to weigh on growth and valuation.