Amazon.com Inc.’s live streaming network, Twitch, is apparently planning a large personnel reduction, with around 35% of its workers, or approximately 500 employees, estimated to be affected.
The announcement of these losses came today, Wednesday, kicking off a sequence of job cuts within the company.
According to sources, this decision followed concerns over Twitch’s financial losses and a succession of high-ranking executive exits in recent months. The company’s representative has declined to comment on these events.
Despite Twitch’s reliance on Amazon’s infrastructure, running a large-scale service that supports 1.8 billion hours of live video content per month incurs significant costs, as stated by company executives. In December, Twitch’s Chief Executive Officer, Dan Clancy, revealed plans to cease operations in South Korea due to “prohibitively expensive” costs.
Despite increasing its emphasis on advertising in recent years, Twitch remains unprofitable nine years after Amazon’s takeover.
Twitch lost numerous important executives in the fourth quarter of 2023, including the chief product officer, chief customer officer, and chief content officer. In addition, the platform lost its chief sales officer, who formerly worked in Amazon’s Ads arm.
Since taking over in March 2023, CEO Dan Clancy has worked hard to reestablish relationships with Twitch gaming personalities. The platform received criticism for its initial approach to advertising, prompting a redesign in response to user feedback.
Despite Clancy’s desire to resolve streamers’ issues, Twitch continues to suffer financial losses. Over the last year, the platform has gone through two waves of layoffs, resulting in the loss of over 400 jobs and contributing to broader job cuts across Amazon.
Amazon launched massive corporate employment layoffs in 2022, expanding to 27,000 workers across the organisation. Furthermore, further layoffs were made in its music sector in October of the same year, encompassing the audio streaming platform and digital storefront for tracks.
Twitch was launched in 2011 by Justin Kan as a spin-off of Justin. Justin.tv, which debuted in 2007 as a single channel, streamed Kan’s life in real time around the clock, pioneering the notion of ‘lifecasting.’ Amazon acquired Twitch for $970 million in cash in 2014 largely allowed the company to operate autonomously.
