Netflix lays off another 300 employees amid sagging stock price, 'slower revenue...

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Netflix to lay off 300 workers, BofA slashes price target on the stock
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Netflix lays off another 300 employees amid sagging stock price, 'slower revenue growth'

Alexandra Canal
·Senior Reporter
Fri, June 24, 2022, 2:04 AM·3 min read
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Netflix (NFLX) just issued another round of job cuts.

"Today we sadly let go of around 300 employees," a Netflix spokesperson said in a statement.

"While we continue to invest significantly in the business, we made these adjustments so that our costs are growing in line with our slower revenue growth. We are so grateful for everything they have done for Netflix and are working hard to support them through this difficult transition," the spokesperson continues.

The job cuts follow Netflix's last round of layoffs in May when the streamer laid off 150 members of its workforce. In recent weeks, a number of technology companies and venture capital–backed firms have announced plans to either freeze hiring, rescind accepted offers, or lay off employees.

Netflix stock, currently trading at around $170 a share, has plummeted more than 70% year-to-date amid a broader market sell-off that's slammed growth stocks and fueled talk of a potential recession.

For context, Netflix’s share price peaked above $690 (market cap of over $300 billion) in November 2021, before credit card data showed a slowdown in customer additions.

The company announced an unexpected first-quarter subscriber loss of 200,000 users in April. It expects to lose another 2 million subs in the current quarter.

On Thursday, Bank of America slashed its price target on the stock, lowering it from $240 a share to $196.

The big bank noted that streaming is now saturated and commoditized, adding that "Netflix as a 'must-have service' [is] becoming more of a curse than a blessing, with several indicators that future subscriber growth for Netflix is going to have to come from outside the United States."

The plummet in net subscriber additions seems to have surprised even Netflix, especially after the platform enjoyed an intense pull-forward effect during the pandemic that brought in 37 million subscribers in 2020.

Netflix "seemed completely caught off guard" by the sudden drop in users, Nat Schindler, Bank of America senior analyst, previously told Yahoo Finance, adding that the platform "hit that wall really fast at a really high rate of speed, and just suddenly stopped growing."

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