Catenaa, Friday, October 09, 2026- Netflix plans to reduce its global headcount by roughly 5%, which would mean laying off about 800 workers.
Reuters said that an internal announcement could come as soon as next week.
Reuters report also said that the company had about 16,000 full-time employees at the end of last year.
The move would be Netflix’s largest workforce reduction since 2022, when the company let go of hundreds of workers amid slow growth and reduced subscriber growth after the pandemic boom.
Netflix faces a more cutthroat streaming landscape, with media companies consolidating and YouTube steadily drawing a larger share of viewers and advertising spending.
The company has been working to diversify beyond its subscription business by investing in advertising, live programming, and gaming.
In July, Netflix posted second-quarter revenue of $12.56 billion, up 13% year over year, with net income of $3.4 billion and an operating margin of 33.4%, and forecasts 33.2% for the pending third quarter. Executives also forecast content expense to rise by about 10% in 2026.
The company narrowed its full-year 2026 revenue forecast to $51 billion to $51.4 billion and reiterated its expectation that advertising revenue would reach around $3 billion for the year.
Netflix stock fell 1.5% on Friday after the Reuters report.
Trefis said Netflix’s valuation depends partly on whether the company can sustain its recently improved profitability.
The stock currently trades at 21.4 times earnings, almost exactly in line with the S&P 500’s 21.5 multiple, and sits near the bottom of Netflix’s ten-year range of 15.3 to 285 times, Trefis reported.
However, the stock trades at 24.4 times operating cash flow, above the broader index’s 14.4 multiple.
The catch is that these earnings come from the widest margin Netflix has recorded in ten years.
Trefis report said that the company posted a 29.7% operating margin over the last twelve months, up from 17.5% three years ago. Paying an earnings multiple this low for a margin this high represents a bargain only if the margin lasts.
