Netflix responds to massive subscriber loss by laying off 150 employees

Netflix laid off 150 employees across the company this week, mostly in the United States, after it suffered a jarring loss of subscribers in recent months and shares of the company have gone down.

“As we explained on earnings, our slowing revenue growth means we are also having to slow our cost growth as a company,” a Netflix spokesperson told CNBC. “So sadly, we are letting around 150 employees go today, mostly US-based. These changes are primarily driven by business needs rather than individual performance, which makes them especially tough as none of us want to say goodbye to such great colleagues. We’re working hard to support them through this very difficult transition.”

The layoffs come less than a month after the company reported a loss of subscribers for the first time in a decade. The streaming service is expected to lose more subscribers in the coming months, as it grapples with the backlash from a possible crackdown on account sharing.

Netflix is also dealing with some political backlash over some of its recent content. The company updated its employee culture memo this week, telling employees the service offers a wide variety of content, and if the employees are uncomfortable with that, they may not find Netflix the “best place” to work.

In response to slowing growth, Netflix is considering adding a lower-tier subscription that includes some advertisements in spite of a push for many years to keep ads off the service. 

“We’re trying to be smart about it and prudent in terms of pulling back on some of that spend growth to reflect the realities of the revenue growth of the business,” said Netflix Chief Financial Officer Spencer Neumann in a recent call with Netflix investors.

The 150 laid off employees make up less than 2 percent of the company’s 11,000 global workforce.