More layoffs are coming at Netflix amid the backdrop of a new PwC report showing a significant overall slide in U.S. subscription video-on-demand revenue, which is now growing at a rate half of what it had been just two years ago.
According to Variety, affected Netflix staffers could be handed their pink slips by the end of the week, with job cuts numbering around the 150 that were already let go last month.
Netflix has declined comment. It's unclear who Variety's sources are.
Netflix's troubles have been well documented, with the company's market cap standing at just over $78 billion -- a fraction of the $306 billion it peaked at back in October. The real damage came on April 19, when Netflix revealed it lost customers in the first quarter (200,000 of them), and that revenue had dropped to below 10%.
But the slowdown hitting the SVOD business is more diffuse than that, especially here in the saturated U.S. market.
According to PwC's just released Global Entertainment & Media Outlook, SVOD operators will collectively generate $25.32 billion in the U.S this year, up 13% from 2021.
That's a marked deceleration from the 19.5% rate the domestic SVOD market expanded at in 2021, and the 27% growth rate back in 2020.
Overall, PwC says that the U.S. remains the world's largest OTT market with a bullet, generating $29 billion in 2021 vs. $11.4 billion for the second largest market, China.
To a large extent, the research company claims, deceleration in expansion is a near-term issue related to consumer streaming habits that were distorted by a kick of nitro during the pandemic.
Transactional video-on-demand sales, for example, exploded by 32.7% in 2020. But with people leaving their houses again to go to school and work, SVOD revenue will actually contract by 8.1% in 2022, PwC says, to $6.1 billion this year. ■
