In a recent blog post, Twitch CEO Dan Clancy announced that Amazon's livestreaming platform, Twitch, is undergoing a significant workforce reduction, with approximately 35% of its staff, roughly 500 employees, being laid off. These layoffs mark the latest in a series of job cuts for the platform.
Live video streaming has gained immense popularity, yet the necessary resources to sustain these services come at a considerable expense.
Twitch had previously undergone two rounds of layoffs last year, resulting in the elimination of 400 jobs. Despite these efforts, Clancy acknowledged in a blog post, "Regrettably, it has become apparent that our organization remains significantly larger than necessary relative to our business's current size."
Clancy further revealed that Twitch paid out over $1 billion to streamers last year. By way of comparison, Amazon purchased Twitch in 2014 for $970 million. Additionally, the company is grappling with the fact that its current size is based on optimistic projections for its business in three or more years, rather than its present state.
"As observed in numerous other tech companies, we are now aligning our organization's size with our current business scale and conservative growth forecasts," Clancy added.
The escalating expenses and layoffs are raising concerns that Twitch might resort to incorporating more advertisements and tolerating controversial content to bolster its revenue.
Concurrently, Amazon indicated that it is implementing its own workforce reductions to "prioritize our investments for the sustained success of our enterprise," as stated by a company executive.