Why is Crunchyroll laying off employees amid global expansion plans?

Crunchyroll, the streaming powerhouse where anime fans go to binge the latest hits, is making headlines again. This time, the buzz isn’t about a shiny new title but rather the unsettling news of employee layoffs rolling out alongside aggressive plans to go global. And while it might seem contradictory for Crunchyroll to be laying off staff just as it’s building in new markets, they have their reasons.

The drama unfolds with a “not a cost-cutting” spin, repositioning roles, and boldly doubling down on markets like India and Mexico. It’s a delicate dance, shrinking here to scale up there. Let’s unpack how Crunchyroll's laying off employees isn’t a betrayal of growth, but rather a recalibration, and see how the streaming giant is trying not to lose its footing while chasing bigger horizons.

Crunchyroll’s global expansion comes with a leaner crew

Crunchyroll is indeed trimming its ranks, but not because money’s so tight it squeaks. According to President Rahul Purini, the layoffs are part of a restructuring meant to support regionally empowered teams and fuel Crunchyroll’s global expansion, not a cost-cutting measure driven by shaky finances.

Internal teams are being restructured so that employees in growth markets can make decisions locally in countries like India, Mexico, Brazil, rather than being micromanaged from the U.S. headquarters. To that end, Crunchyroll is setting up new engineering hubs in the U.S., India, and Mexico, aiming to spark innovation where the users and larger growth lie.

Crunchyroll isn’t new to this balancing act. Back in February 2023, it laid off 85 employees across its 12 offices in the U.S., France, Germany, Moldova, Australia to streamline after merging with Funimation. That move was framed as resolving redundant roles, not trimming the fat.

Still, the timing of making cuts while pumping resources abroad feels odd. But there's precedent, as Crunchyroll has been doing this since Sony took over in 2021. Reports indicate this is the fourth round of layoffs since then, roughly one per year, pointing to recurring efforts to recalibrate staffing structures amid shifting ambitions.

There’s also a larger cloud overhead: competition from Netflix, Amazon, Disney (they’ve muscled into anime too) and underperforming side ventures like e-commerce and video games. Those experiments haven’t always paid off, which could be nudging Crunchyroll to focus on its streaming core and global reach instead.

Employee morale isn’t exactly soaring as internal surveys show motivation has dipped from 51% to 39%, and some staff gripe that management feels out of touch with anime fandom. Still, Crunchyroll claims it's bullish about what’s ahead. Purini’s memo credits the move with better regional agility, a streamlined structure, and a confident statement about its future in a booming yet competitive anime world