BUSINESS + ECONOMY

Amazon will cut hundreds of jobs, including at game streaming firm Twitch

Jan 10, 2024, 8:00 PM | Updated: May 28, 2024, 10:23 am

Twitch, an Amazon owned company, signage outside its headquarters, Tuesday, Dec. 26, 2023, in San F...

Twitch, an Amazon owned company, signage outside its headquarters, Tuesday, Dec. 26, 2023, in San Francisco. Video game streaming company Twitch said January 10 it is laying off 500 workers as part of ongoing cost-cutting efforts. (Aaron M. Sprecher/AP)

(Aaron M. Sprecher/AP)

Originally Published: 10 JAN 24 12:31 ET
Updated: 10 JAN 24 21:25 ET

New York (CNN) — Amazon on Wednesday cut hundreds of jobs across two different business units: streaming platform Twitch and its film and television studios division.

Amazon is cutting “several hundred” roles across Prime Video and Amazon MGM Studios, according to an internal note shared with CNN. In addition, video game streaming company Twitch, which is owned by the tech giant, said Wednesday it is laying off 500 workers as part of ongoing cost-cutting efforts.

Mike Hopkins, senior vice president of Prime Video and Amazon MGM Studios, said in an internal memo that the company began to reach out to affected employees Wednesday.

“We’ve identified opportunities to reduce or discontinue investments in certain areas while increasing our investment and focus on content and product initiatives that deliver the most impact,” he said in the letter.

Amazon closed its $8.5 billion deal to acquire MGM in 2022, which helped boost the company’s position in the entertainment world while giving its streaming service, Amazon Prime Video, even more content to fill its already extensive library.

Hopkins said the company is “providing packages that include a separation payment, transitional benefits as applicable by country, and external job placement support.”

Twitch layoffs

Twitch CEO Dan Clancy confirmed the gaming unit’s layoffs in messages to the company’s users and staff, calling it an “incredibly difficult” decision. Wednesday’s announcement comes after Twitch laid off 400 workers in March of last year as part of broader cuts at parent company Amazon.

“Over the last year, we’ve been working to build a more sustainable business so that Twitch will be here for the long run and throughout the year we have cut costs and made many decisions to be more efficient,” Clancy said in the note to employees, which was shared publicly. “Unfortunately, despite these efforts, it has become clear that our organization is still meaningfully larger than it needs to be given the size of our business.”

The layoffs were first reported by Bloomberg.

It was not immediately clear which areas of the company would be affected by the cuts. Clancy said affected employees would be notified on Wednesday.

The CEO also said he would hold a livestream conversation on Twitch on Thursday afternoon to answer any questions from the company’s users.

The layoffs point to ongoing challenges at Twitch, although Amazon does not break out specific results for the unit. They also follow the departures of several top executives from the company late last year, including its chief product officer, chief customer officer, chief content officer and chief revenue officer.

“While the Twitch business remains strong, for some time now the organization has been sized based upon where we optimistically expect our business to be in 3 or more years, not where we’re at today,” Clancy told employees Wednesday.

He added that Twitch paid out $1 billion to streamers through its revenue share model in 2023.

Many major tech firms conducted mass layoffs last year in an attempt to compensate as pandemic-era revenue highs came back down to earth.

Those layoffs largely tapered off toward the second half of last year, although Amazon and Google made some smaller, more targeted cuts in late 2023, and other tech firms including Spotify, Etsy and Dataminr also made cuts.

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Amazon will cut hundreds of jobs, including at game streaming firm Twitch