(CTN News) – An executive overseeing Amazon’s Twitch livestreaming division wrote a memo to its employees on Wednesday telling them that about 500 people are being laid off.
Dan Clancy, Twitch’s chief executive, said that the company made the cuts because of the fact that it wanted to “rightsize our company” and align its headcount with the size of the business at the moment.
In 2014, Amazon acquired Twitch for a reported price of almost $1 billion. A popular feature of the site is its ability to livestream video games, making it a popular platform for livestreams.
Due to Amazon’s purchase of Twitch, the company has mostly stayed out of the livestreaming platform, although it offers Prime subscribers perks, like free games and in-game loot.
There are many of you who are wondering why this is happening. We have been working over the last year to build a more sustainable business so that Twitch will be here for the long run, and we have made many decisions over the course of the last year in order to be more efficient,” Clancy wrote.
“Unfortunately, it has become clear that despite these efforts our organization remains significantly larger than it needs to be given the size of our business, despite our best efforts. More than $1 billion has been paid out to streamers in the last year alone.
For some time now, Twitch has been sized according to where we optimistically expect our business to be three or more years from now, rather than where it is today, even though the Twitch business remains strong.
The layoffs at Twitch are the third time the company has slashed its staff in less than a year. Twitch cut roughly 400 employees from the company last March, and it also cut some employees from its customer experience division in October of last year.
A number of the unit’s highest ranks have also changed. In March of last year, Emmett Shear stepped down as Twitch’s CEO, giving Mitch Clancy the opportunity to take over. Last month, Chief Content Officer Laura Lee and Chief Customer Officer Doug Scott announced their departures from the company.
As a result of the largest layoffs in Amazon’s history, 27,000 employees have been laid off since 2022, the biggest in the company’s history. On Wednesday, Amazon announced that it would be laying off employees in its Prime Video and MGM Studios units as part of ongoing cuts.