(Bloomberg) — Amazon.com Inc.'s live streaming site, Twitch CEO Dan Clancy, said in a blog post Wednesday morning. Twitch has laid off 35% of its employees, or about 500 workers. The layoffs are the latest in a series of job cuts there.
Most read from Bloomberg
The cuts, reported by Bloomberg News earlier on Tuesday, come amid concerns about losses at Twitch and after several top executives left the company within a few months.
“Over the past year, we have worked to build a more sustainable business so that Twitch will be here for the long term, and throughout the year we have cut costs and made many decisions to be more efficient,” Clancy wrote in the blog. . mail. “Unfortunately, despite these efforts, it has become clear that our organization is still much larger than it needs to be given the size of our business.”
Company executives have said that running a large-scale website that supports 1.8 billion hours of live video content per month is too expensive, despite Twitch's reliance on Amazon's infrastructure.
The company also remains unprofitable more than nine years after Amazon acquired the company, according to people familiar with the company's finances who requested anonymity to discuss private information. Twitch has increased its focus on advertising in recent years, and has worked to significantly reduce costs. In December, Clancy said the company would cease operations in South Korea, where costs were “prohibitive.”
“This decision, while extremely difficult and painful, is necessary to ensure that we can continue to serve our streamers sustainably without impacting their ability to support their careers on Twitch,” Clancy said in a blog post on Wednesday. He added that Twitch paid more than $1 billion to streamers in 2023.
In the final months of 2023, several senior executives announced their departures, including Twitch's chief product officer, chief customer officer, and chief content officer. Twitch also lost its chief revenue officer, who worked on Twitch from within Amazon's advertising unit. All former executives declined to comment.
“It's always bittersweet when talented leaders move on to pursue new opportunities,” a Twitch spokesperson said at the time. “We are extremely grateful for their contributions to Twitch and our community, and wish them all the best.”
Since taking office in March 2023, Clancy has been on a crusade across the country to mend relationships with gaming celebrities who make their living by streaming on Twitch. Many of them expressed anger at Twitch's original approach to advertising, which the company reworked after criticism. Streamers praised Clancy's willingness to listen to their concerns after years of complaints that the service was out of touch with its users.
But the new president struggled to stem the losses. Twitch made two rounds of layoffs last year, cutting more than 400 jobs, as part of broader job cuts at Amazon. Like other tech companies, Twitch's downsizing is based on the size of the business at the moment and “conservative projections of how we will grow in the future,” Clancy said.
Amazon began the company's largest-ever job cuts in 2022, expanding to 27,000 jobs across the company. It continued in October with a new round of discounts in its music division, which includes the company's audio streaming platform and digital music storefront.
(Updates with company comments starting in first paragraph.)
Most read from Bloomberg Businessweek
©2024 Bloomberg L.P
