Netflix is eliminating roughly 1,000 positions — about 6% of its staff — in what Variety describes as the streamer's biggest layoff to date.

Co-CEOs Ted Sarandos and Greg Peters announced the cuts in a memo to employees on Wednesday morning, saying the greatest impact will fall on the product, technology, legal and human-resources teams.

As of the end of 2025, regulatory filings put Netflix at about 16,000 full-time employees, so the reductions touch roughly one in sixteen staff members. The Wall Street Journal first reported the news.

What makes the move jarring is that Netflix insists its business is thriving. Variety notes the company posted $45.2 billion in revenue in 2025, up 16%, with net income of $11 billion, up 26%, and projects 2026 revenue of $51.0–$51.4 billion with a 31.5% operating margin.

In the memo, Sarandos and Peters wrote, "Our business is strong and growing, and we remain on track to deliver our full year forecast."

Yet the cuts are the company's largest ever, dwarfing the roughly 450 jobs axed in 2022, and come amid what the co-CEOs call a need to make "focused choices" about resources.

The Wall Street Journal, via Editor and Publisher, reports the layoffs come as Netflix struggles with slowing growth and customer engagement.

Variety adds that investors have been concerned per-user engagement slowed in the first half of 2026, though Storyboard18 reports members still watched more than 97 billion hours of content in that period, up 2% year over year.

Netflix's Q2 revenue rose 13.4% to $12.6 billion, but its operating margin slipped to 33.4% from 34.1%, and the company issued third-quarter guidance below analyst expectations, driving the stock down. Shares traded down 1.4% to $69.45 on Wednesday morning, per Variety.

The Associated Press, via KCCI, frames the cuts against a newly crowded streaming field.

Netflix remains dominant with 19% of the market per JustWatch, but Amazon's Prime Video and Disney+ sit close behind, and HBO Max and Paramount+ are now under the same roof after Paramount's $81 billion buyout of Warner Bros.

Discovery closed last week — a combined giant that plans to unify its streaming products into a single service over time. Notably, the AP recalls Netflix agreed to buy Warner's studio and streaming business late last year, then walked away from that offer in February.

For subscribers, the co-CEOs say the cuts fund aggressive investment in "high impact areas to improve our service."

Storyboard18 reports Netflix has been broadening beyond its streaming roots — video podcasts, programming featuring YouTube creators, live sports and events, and even exploring live television channels and bundles with other services.

For employees, the human toll is already visible: Variety reports layoffs include director of original series Carolina Garcia, who exits after ten years. Netflix declined to comment beyond the memo, saying its priority is supporting those leaving, with leaders connecting to impacted employees soon.

All eyes now turn to Netflix's third-quarter earnings report, scheduled for Tuesday, October 20, after market close. The layoffs land a week early, giving investors a fresh lens on how the company balances cost discipline with its promised investment in growth.

This time, the company says engagement is "healthy" by its own assessment, and it remains on track for its full-year forecast; whether investors agree will show in next week's numbers.