Netflix, which said it lost almost one million subscribers in Q2, has been aggressively cutting costs, implementing a variety of measures that range from scaling back its real estate footprint to trimming cloud computing. While the streaming giant says the cuts have not significantly impacted content spending, it has laid off more than 400 employees in 2022 and has begun hiring more junior staff, according to reports. Macroeconomic trends have made belt-tightening common across the industry, but at Netflix it stands in stark contrast to years of explosive growth and free spending.

The Wall Street Journal calls it “a cultural shift,” and says “the cost-cutting efforts are going deeper, touching most corners” of the company’s business. Netflix has been spending heavily on cloud services and networking infrastructure, on which the reliability of its service relies. Now it’s working with longtime cloud partner Amazon Web Services to reduce or at least control those costs.

“Netflix aims to keep costs from ballooning as it tries to increase its subscriber base to as many as 500 million customers globally in the next three years,” WSJ says, noting that “among the changes Netflix is exploring is reducing the number of copies of data and content it stores around the world.”

Various sources estimate Netflix’s AWS expenditures at between $950 million and $1 billion per month. The Wrap writes that “Netflix’s unexpected partnership with Microsoft to launch its ad-supported tier later this year could potentially offer an alternative to AWS down the line.”

While Statista reports that AWS was the world’s leading cloud services provider, with a 34 percent share as of Q2, Microsoft’s Azure was number two, with 21 percent.

In terms of real estate, WSJ says “Netflix is closing its Salt Lake City office and has told workers there they will do their jobs remotely” and “is giving up space in Los Gatos, California and Los Angeles.” The Salt Lake City office was home to a legal team and a technical customer support center, as well as some production technology. Netflix had previously outsourced much of its general customer support.

The company is also trying to make do with fewer senior employees, hiring more juniors and interns “as part of an expanded ‘emerging talent’ recruitment initiative,” according to WSJ. “That change means the company can spend less on salaries for some roles and ensures that skilled staff can focus on complex tasks as the company grows.”

Swag is another area that has come under scrutiny. “The company over the past year put limits on the Netflix-branded goods, including coffee mugs, sweatshirts and baby onesies, that employees can order,” WSJ writes, noting that “after years of unlimited orders, employees are now limited to ordering $300 worth of merchandise a year.”

Netflix’s operating expenses increased in 2021, up 15 percent to $23.5 billion, much of it due to greater spending on salaries and content delivery. “The company spends heavily to create movies and TV shows and has increased its content budget steadily for years,” WSJ reports. CFO Spencer Neumann “in April said Netflix is now trying to pull back on content- and non-content-related spending.”