Originally Published: 10 JAN 24 12:31 ET

By Clare Duffy, CNN

New York (CNN) — Video game streaming company Twitch said Wednesday it is laying off 500 workers as part of ongoing cost-cutting efforts.

Twitch CEO Dan Clancy confirmed the layoffs in messages to the company’s users and staff, calling it an “incredibly difficult” decision. Wednesday’s announcement comes after Twitch laid off 400 workers in March of last year as part of broader cuts at parent company Amazon.

“Over the last year, we’ve been working to build a more sustainable business so that Twitch will be here for the long run and throughout the year we have cut costs and made many decisions to be more efficient,” Clancy said in the note to employees, which was shared publicly. “Unfortunately, despite these efforts, it has become clear that our organization is still meaningfully larger than it needs to be given the size of our business.”

The layoffs were first reported by Bloomberg.

It was not immediately clear which areas of the company would be affected by the cuts. Clancy said affected employees would be notified on Wednesday.

The CEO also said he would hold a livestream conversation on Twitch on Thursday afternoon to answer any questions from the company’s users.

The layoffs point to ongoing challenges at Twitch, although Amazon does not break out specific results for the unit. They also follow the departures of several top executives from the company late last year, including its chief product officer, chief customer officer, chief content officer and chief revenue officer.

“While the Twitch business remains strong, for some time now the organization has been sized based upon where we optimistically expect our business to be in 3 or more years, not where we’re at today,” Clancy told employees Wednesday.

He added that Twitch paid out $1 billion to streamers through its revenue share model in 2023.

Many major tech firms conducted mass layoffs last year in an attempt to compensate as pandemic-era revenue highs came back down to earth.

Those layoffs largely tapered off toward the second half of last year, although Amazon and Google made some smaller, more targeted cuts in late 2023, and other tech firms including Spotify, Etsy and Dataminr also made cuts.

The-CNN-Wire