Twitch To Reportedly Slash Workforce By 35% After Top Execs Abandon Streaming Ship

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Twitch will be reducing its workforce by a staggering 35%, or 500 employees, according to Bloomberg’s Cecilia D'Anastasio. This is another large round of cuts that continues the brutal trend of reducing headcount in the tech sector that was prevalent throughout 2023.

The move is seen as an attempt to make Twitch profitable, something the company is struggling with as it deals with the costs of providing 1.8 billion hours of content to users on a monthly basis. Higher ups at the company have said that even with the advantage of having Amazon's infrastructure, it isn’t enough to be able to mitigate the costs of delivering content. It seems to be so difficult and expensive that the company recently made the drastic choice to stop operating in South Korea.

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Recently Twitch has been trying to find more ways of generating more revenue from advertising rather than relying solely on paying users. For example, live viewers are now shown banner ads while watching, letting them know about items available on Amazon. However, according to D'Anastasio the pivot the company made to rely more on advertising revenue isn’t helping turn the situation around.

What might be more concerning is the loss of individuals in key executive positions. D'Anastasio says that since the beginning of 2024 the company has seen the departures of its chief operating officer, chief content officer, and head of creator development. This suggests that the problems might be even worse than they seem, and those people felt it was better to jump ship sooner rather than later.

It will be interesting to see Twitch navigate 2024. Hopefully the company is able to right the ship and get back on track as a lot of people rely on the service for their businesses and online communities.