Netflix’s revelation that it lost 200,000 subscribers in the first quarter has put further pressure on an already beleaguered tech sector, but leading analyst Mark Mahaney believes the sector’s current weakness presents several opportunities for investors.
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Netflix is laying off about 300 more employees across the company.
The cuts, which represent about 3% of the total number of employees, come about a month after the streaming company cut about 150 positions following its first loss of subscribers in a decade.
“Today, we unfortunately laid off approximately 300 employees,” Netflix said in a statement Thursday. “As we continue to invest significantly in the business, we have made these adjustments so that our costs increase in line with our slower revenue growth. We are very grateful for all they have done for Netflix and work hard to support them through this difficult transition.”
Netflix had warned investors in April that it would cut some of its spending growth over the next two years.
Spencer Neumann, the company’s chief financial officer, said during the company’s April earnings call that Netflix was trying to be “cautious” about pulling out to reflect the realities of its business. However, it still plans to invest heavily, including around $17 billion in content.
Co-CEO Reed Hastings also said on the call that the company was exploring low-cost, ad-supported tiers in a bid to attract new subscribers after years of ad resistance on the platform.
Netflix is also working to crack down on rampant password sharing. In addition to its 222 million paying households, more than 100 million households use its service through account sharing, the company said.
Shares of Netflix were roughly even in afternoon trading Thursday, but are down about 70% year-to-date.