Another tech firm hit
The tailspinning US technology industry has snarled up another firm as Amazon-owned Twitch prepares to layoff over 400 workers.
Amazon’s plan to cut 9,000 workers
The measure is part of Amazon’s plan to cut 9,000 workers from its Amazon Web Services, advertising, people experience tech, and Twitch units. Streamer newswriter Zach Bussey took to Twitter with excerpts from an internal staff email sent by Twitch’s new CEO Dan Clancy:
Bussey initially claimed the job cuts would affect 15% of the San Francisco-based streaming site’s employees, but cited Twitch staff saying the percentage was “closer to 20.” In the internal email, Clancy said the decision was necessary for Twitch’s long-term sustainability.
The news comes just days after former Twitch CEO Emmet Shear announced he was stepping down in order to spend more time with his family.
New CEO brings bad news
Clancy’s internal email confirmed that he had informed Twitch workers management had made the hard decision of “having to say goodbye to just over 400 people.” The CEO stated that despite expanding significantly during the pandemic lockdowns, Twitch’s revenue and user growth had not lived up to expectations.
We were overly optimistic and grew our costs, primarily headcount.”
The new chief executive said that the effort to cut costs started with a reduction in hiring in 2022 and budget cuts across the board. Despite these measures making “a significant impact,” Twitch management decided that, for sustainability’s sake, the business had to make a cut from its largest cost outlay, its workforce.
Twitch loses while Kick gains
In addition to its financial woes, Twitch is also having to deal with many of its high-profile streamers migrating to Kick, a newer platform that allows controversial material, unlike its struggling competitor. Popular gambling streamers such as Trainwreck, Roshtein, and Xposed have all made the shift to the Stake-backed site.
Controversial streamer AdinRoss recently predicted that more content creators would jump ship due to the better subscription deals offered by Kick, along with its more lenient stance on controversial content.