Netflix is reportedly preparing to announce layoffs affecting about 5% of its workforce, a sweeping reduction that could leave hundreds of employees without jobs. Reuters reported that the cuts could be announced as soon as next week.

Up to 800 workers among Netflix’s 16,000 employees could receive pink slips beginning next week, according to the report. The expected reduction represents one of the clearest signs of pressure facing the streaming giant.

Netflix is confronting a crowded market as smaller streaming services give viewers more choices. The company also faces mounting competition from YouTube, which has steadily increased its share of people watching television online.

Netflix $NFLX is reportedly planning to cut 5% of its workforce as soon as next week - Puck News https://t.co/ELffzOcsZl

— Evan (@StockMKTNewz) October 9, 2026

The reported cuts come even as Netflix continues to generate billions of dollars in revenue and income. Its second-quarter report showed revenue of $12.56 billion in July, representing an increase of 13% over 2025.

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Netflix also reported net income of $3.4 billion for the quarter. Its operating margin reached 33.4%, reflecting substantial profitability even as the company prepares for a potentially significant workforce reduction.

Those results were accompanied by a less robust outlook for the remainder of 2026. Netflix lowered its full-year revenue forecast to a range between $51 billion and $51.4 billion.

The company also said it expects to earn $3 billion from advertising sales during the year. Advertising has become one of the services Netflix is working to expand as it responds to intensifying competition.

Investors reacted sharply after the financial report was released. Netflix stock fell more than 8%, adding another visible sign of concern surrounding the company’s growth expectations and revised annual forecast.

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Netflix has been attempting to broaden its business beyond its established streaming operation. Those efforts include expansions into gaming, live programming, and a more concerted advertising program.

The strategy comes as rivals continue to flood viewers with entertainment choices. At the same time, YouTube’s rising share of online television viewers has added another competitive challenge for Netflix.

Early this month, Netflix co-CEO Ted Sarandos acknowledged that the company was not expanding at the pace he wanted. His comments came in response to the steep decline in Netflix’s stock price.

“Overall, we’re not growing as fast as I want us to, and we’re working on making that move faster,” Sarandos said. He made the statement during Bloomberg’s 2026 Screentime event.

Sarandos also drew a line around the kind of material Netflix intends to offer. He said the company does not plan to enter the business of user-generated content.

“We’re definitely… not in the UGC [user-generated content] business,” Sarandos said. He added, “We’re in the professionally produced content business.”

That distinction places Netflix’s focus on professionally produced programming while it pursues new opportunities in gaming, live shows, and advertising. The company’s strategy remains tied to those expansion efforts as competition grows and its forecast narrows.

The reported layoffs would nevertheless bring an immediate and painful consequence for the workforce. A 5% reduction among 16,000 employees would place as many as 800 jobs at risk, according to the Reuters report.

For Netflix, the planned cuts arrive alongside strong quarterly figures, a reduced annual revenue outlook, and a stock decline exceeding 8%. Sarandos’s admission about slower-than-desired growth has now been followed by reports that hundreds of employees could soon receive pink slips.

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