Erik Gruenwedel

October 14, 2026

Storm clouds are brewing around Netflix with the No. 1 global subscription streamer reportedly axing 1,000 employees, or 6% of its global workforce. It’s the largest round of layoffs since 2022 when the company saw a quarterly drop in subscribers and immediately announced the pending launch of a lower-cost ad-supported subscription tier.

The layoffs were announced to staff in an email from co-CEOs Ted Sarandos and Greg Peters, according to the Wall Street Journal.

“Our mission — to entertain the world — is ambitious, and delivering on it requires us to be disciplined about where we prioritize our people and resources,” wrote Sarandos and Peters.

The layoffs come as the service saw a 16.6% spike in subscriber churn (members who do not renew) in the third quarter ended Sept. 30, according to data from Apptopia. The tally is double the 7.8% churn in Q2, and underscores a seven-quarter consecutive churn increase.

Churn measures how many users who were active 30 to 60 days ago didn’t open the app in the most recent 30 days. When it goes up, more people are drifting away from the app.

In Q3 the churn rate doubled. In the first six quarters, U.S. churn increased, but were all under 5%. Q3 was up 8.5% from Q2.

The streamer has long championed a “we are a team, not a family” corporate culture that seeks to emulate a professional sports team to achieve results. Employees are expected to lean into rapid changes, massive industry shifts, and bold experimentation. Netflix embraces short-term chaos as a necessary byproduct of driving original thought and avoiding corporate stagnation, according to its 2009 “Culture Deck” popularized by co-founder Reed Hastings and former chief talent officer Patty McCord.

Sarandos and Peters said Netflix would continue to invest “aggressively in high impact areas,” but that doing that would also include “making focused choices across the business, so we can keep delivering for our members, partners, employees and investors.”

A optimistic view came from Wolfe Research’s Peter Supino in August. He argued a soft Q2 came down to the content release calendar. Shows returning in Q3 had drawn 1.3 billion viewing hours in their prior seasons, against 765 million for the Q2 slate, according to 24/7 Wall St.

Netflix reports third quarter fiscal results on Oct. 20.