In its latest quarterly report, Netflix has lost 200,000 subscribers in the first three months of 2022, which caused the company’s stock to fall 26%.
The streaming giant also lost 700,000 members when it suspended services in Russia, shortly after it invaded Ukraine.
To combat the loss, Netflix is contemplating releasing a cheaper ad-supported plan. Netflix CEO Reed Hastings said, “Those who have followed Netflix know that I’ve been against the complexity of advertising, and a big fan of the simplicity of subscription. But, as much as I’m a fan of that, I’m a bigger fan of consumer choice.”
Apart from the dropping subscriber base, the company also blamed fierce competition from other streaming services like Disney+ and HBO Max, the rate at which consumers adopt on-demand services, and a slow economy.
Account-sharing is also seen as a problem. Netflix may soon crack down on this, recently looking into ways to earn from the longstanding practice.
Despite the loss of subscribers, Netflix achieved a USD 7.87 billion revenue in the first quarter 2022. It also held on to its share of TV viewing in the US according to a Nielsen study.
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But in the next three months, Netflix will continue to slow down, predicting that it would lose 2 million more subscribers in the next three quarters, despite the return of highly anticipated titles like “Stranger Things” and “Ozark” and the debut of “The Grey Man,” which stars Chris Evans and Ryan Gosling.
Source: Reuters
Featured Image: Unsplash
