Another round of layoffs is hitting Twitch.
The Amazon-owned livestreaming platform will cut 35% of its staff, or roughly 500 employees, Bloomberg reports, and will announce the reduction as early as this week.
Twitch did not immediately respond to TechCrunch’s request for comment.
It’s the latest blow for the already beleaguered company, which cut hundreds of jobs last year amid leadership changes, rising operating costs and community discontent. Shortly after Twitch co-founder and longtime CEO Emmett Shear handed the reigns to its now-CEO Dan Clancy, the company laid off 400 employees. Amazon cut another 180 jobs late last year when it shut down its Crown channel, the Amazon-run Twitch programming, and shuttered its Game Growth group, which was supposed to help gaming creators market themselves.
Twitch also recently announced plans to shut down service in South Korea — one of the largest esports markets in the world — over “prohibitively expensive” network fees. In a blog post announcing the closure, Clancy wrote that the company had been operating at a “significant loss” in Korea, and that there was “no path forward” to run sustainably.
Despite its popularity — the platform’s usership has skyrocketed since pandemic lockdowns several years ago — Twitch still struggles to turn a profit. Its pivot to prioritizing ad revenue, which has been a point of contention among viewers and streamers, has not been fruitful; Bloomberg reports that the company is still unprofitable nearly a decade after Amazon acquired it. Several executives left Twitch in December, including its chief revenue officer.
Twitch faces steep operating costs to support livestream content at such a large scale. In a 2022 blog post, Clancy stated that each high-volume streamer on Twitch costs the company about $1,000 per month, citing Amazon Web Service’s interactive video rates.
“Delivering high definition, low latency, always available live video to nearly every corner of the world is expensive,” Clancy wrote.
Source @TechCrunch
