Netflix (NASDAQ:NFLX) stock is down 1% today on news of layoffs. Specifically, the streaming giant is taking steps to restructure its film department, which means job cuts.
Details are still emerging, but according to a report from Deadline, the Netflix layoffs will only impact 15 people. This follows a shakeup last month, when Dan Lin replaced former studio chief Scott Stuber. Stuber had been an executive at the company since 2017.
Now, it seems even more changes are taking place at the streaming firm.
What the Netflix Layoffs Mean for NFLX
While shares are down today, NFLX stock has still enjoyed an excellent season. Shares are in the green by 4% for the month and have surged more than 60% over the past six months. A proven blue-chip winner, Netflix has done an excellent job riding out less-than-ideal market conditions so far. With that in mind, investors shouldn’t be too worried about the recent job cuts.
Plenty of other companies have opted for layoffs recently, including Best Buy (NYSE:BBY). But Netflix is a particularly strong company with plenty going for it. As InvestorPlace contributor Muslim Farooque reports:
“[In] its 2023 shareholder letter, Netflix’s management discussed the incredible untapped potential in advertising and gaming, highlighting its significant growth potential. With over $600 billion at stake in pay TV, film, games, and branded advertising, Netflix captures just 5% of this vast opportunity.”
Clearly, Netflix is focused on making the changes it deems necessary to keep growing. Large-scale job cuts don’t always mean bad news for a stock. But since Netflix is laying off only 15 people, investors especially have no cause for concern. This could end up being a good development for the company, especially if the reorganized team is able to help spur growth through new ideas and initiatives.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
