Even though Ted Sarandos had long been telegraphing that a major reorganization was ahead at Netflix, Bela Bajaria didn’t expect the ax was coming for her role. Days ago, the chief content officer at the streaming giant was in Cannes receiving an honor while the MIPCOM marketplace was in full swing, before turning to unveil a major World Cup media rights deal a day later. As lower level executives were being informed of pink slips, sources tell The Hollywood Reporter, Bajaria did not know she was going to be ousted until at least Wednesday and had been personally informing staff of company layoffs.

Even as speculation centered on Bajaria’s role — when times are tough, the top programming chief is always on the hot seat — jaws dropped inside Netflix when the one-two punch of the ousting and former Fox exec Peter Rice’s arrival was announced internally.

In hindsight, much could be made about the smoke signals that Sarandos was putting out to the town. The Netflix honcho had met with HBO chief Casey Bloys multiple times this year, including a very public one at Superba, the airy restaurant on Sunset near the Netflix offices that also serves as the streamer’s unofficial commissary. “He did that so people could see it,” says one source. “It was putting Bela on notice.”

Nevertheless, the Bajaria/Rice swap has been discombobulating for Netflix employees (“it’s been bumpy,” one says), many of whom have already been reeling from the streaming giant’s stock slide. Netflix strongly encourages employees to take a portion of their pay in the form of equity, but with shares down more than 45 percent from a year ago employees who have done so are feeling the pain.

But it also portends a major strategic shift for the company, even if that new plan remains obscured for the time being. Sarandos and Peters are expected to elaborate on their thinking next Tuesday afternoon when they brief Wall Street analysts for Netflix’s quarterly earnings update. Sarandos told staff Thursday in an email that they will hold a companywide town hall on Oct. 21 to dig into more granular details: “I want everyone to hear how we’re thinking about the strategy and our execution amid this week’s changes, and to have a chance to ask questions,” he wrote.

But the job market for Hollywood execs, clearly, is just getting tighter and tighter. “It’s a game of musical chairs and the music has stopped,” says one executive who works with Netflix.

With the Bajaria ouster done and dusted, the industry’s eyes are now trained on film chief Dan Lin, who held an urgent meeting with the film team at the company on Thursday night to go over the shake up. In this week’s layoffs, Lin’s No. 2, VP of film Doug Belgrad, was swept out, among other film side executives. Belgrad was known as a manager of managers at the company. And his layer had effectively been axed.

Lin joined the company in 2024, hired by Bajaria from his own production outfit, where he amassed a handful of $1 billion hits. The exec was brought in to rein in filmmaker spending and streamline Netflix’s notoriously unwieldy film operation. It was not uncommon for a project to get pitched to two different Netflix film groups with different results. Lin has made good on his re-org, sorting his group by genre (thrillers, sci-fi, rom-com, etc.) as opposed to prospective budgets.

Under Lin, the division has produced films that proved popular with subscribers, including Remarkably Bright Creatures, People We Meet on Vacation and Apex, but, like the rest of Netflix’s slate as of late, has not been able to hold tight to the attention spans of an increasingly distracted viewership. (To be fair, it’s tough to compete with an entity like YouTube, a platform that commands attention at all hours of the day and for every type of content.) All the while, filmmakers are increasingly forgoing larger paydays for the lure of a theatrical release, as was the case out of this year’s Sundance with Olivia Wilde’s The Invite.

While Netflix’s layoffs are still fresh, they also may not be done making changes yet. One agency source tells THR that they believe Rice will be fully empowered to bring in new people and restructure Netflix’s content operations once he officially joins.

Whether Lin stays at Netflix is an open question. Before being ousted at Warner Bros. following the studio’s merger with Paramount, former Warner film co-head Pam Abdy was also spotted lunching with Sarandos, while fellow former film chief Mike De Luca is known to have a relationship with the CEO. No word on if there may be a deal for the duo to land over at the streaming giant as the company prepares for a few big theatrical releases ahead.

Perhaps the most shocking thing about Rice’s move to Netflix is that, as one entertainment veteran notes, he is a Hollywood guy, not a Netflix guy. While Netflix’s executive ranks are filled with entertainment veterans, the very top of the org chart has long been dominated by people developed in-house.

Sarandos and former Netflix and Paramount exec Cindy Holland both worked at the company when it was exclusively in the DVD-by-mail business, and shifted to original content after it made the move into streaming. Bajaria was a senior executive at NBCUniversal before joining Netflix as a VP, but she spent years at the company before being elevated. Rice is the first true outsider to arrive at the top of the org chart with a mandate to shake things up.

While some content execs were axed in the layoffs this week, the cuts were mostly focused on product, tech, legal and HR. Netflix has long utilized its in-house “keeper test” to determine whether changes need to be made, with founder Reed Hastings likening the company to a championship sports team that is quick to make changes if they see an opportunity to bring in an all-star.

Reading between the lines one can get a sense of what Sarandos and Peters may be thinking about.

Rice will surely want to make his own adjustments once he starts, and if the content strategy is radically changed, staffing would change too. Many of the people he worked with at Fox and Disney have moved on to bigger and better roles (see Dana Walden and Ravi Ahuja, among others), but there may be talented executives a rung or two down that he may try to bring over.

One of Bajaria’s biggest achievements was globalizing Netflix content, empowering teams across the world to develop originals that it could bring everywhere. The result was legitimate smash hits like Squid Game and Adolescence, and yet Netflix still lags behind legacy studios when it comes to franchises and valuable intellectual property. That was a driving force behind its pursuit of Warner Bros., after all.

Rice may be about to change that strategy.

“I know this is a big change in a year that has already had its share,” Sarandos wrote in his memo to staff. “But I also see an opportunity to take our slate to the next level, especially in UCAN where we have an outsize impact in creating big, buzzy hits that our members love and drive conversation around the world.”

In other words, Netflix may be about to recalibrate around the U.S. market once again, with a focus on the big and buzzy and, yes, franchise-worthy. (Netflix, which also saw its PR operation take a big hit with multiple execs let go, declined to comment for this story.)

Rich Greenfield, the Lightshed Partners analyst, said Friday morning on Squawk Box that he believes Rice is being brought in for his history of risk-taking at Fox and Disney: “I think that is why he is being brought in to Netflix, is to increase the amount of risk they are taking, and to really try and find breakout hits to help them accelerate engagement growth.

The longtime Wall Street voice added, “I suspect that you will see some real big swings that Netflix takes over the next couple of years.”