Netflix loses 200,000 subscribers in the first three months of 2022

Netflix reported net income of $ 1.597 billion (€ 1.480 billion) in the first three months of 2022, which is a 6.4% drop from the US online movie and series distribution company a year earlier. , which lost 200,000 subscribers between January and March and expects another two million subscribers to decline in the second quarter. Shares of Netflix fell more than 25% in after-hours trading, after closing the session with a gain of 3.18%. So far this year, Netflix has lost more than 40% of its value on the stock market and if the drop seen in trading after the Wall Street close is confirmed, the drop could be around 60% so far this year. In the first three months of 2022, Netflix reduced its worldwide subscriber base to 221.64 million, which represents an increase of 14 million paying users or 6.7% compared to the first quarter of 2021, but a decline of 200,000. subscribers from last year’s fourth quarter, its first decline in a decade, and the Los Gatos-based multinational expects its number of subscribers worldwide to continue to decline in the second quarter, when it expects to have 219 , 64 million subscribers, about 2 million paying users less than in the first quarter. Netflix said its first quarter results reflect the impact of the suspension of its service in Russia and the liquidation of all Russian paying accounts, which led to the loss of 700,000 subscribers, without which the platform would have increased its subscribers. half a million. Despite this loss of subscribers, the company’s revenue in the first quarter increased 9.8% to $ 7.868 billion (€ 7.293 billion) and the multinational is confident that between April and June, revenue will grow by 9.7%. on an annual basis to 8.053 billion dollars (7.464 billion euros). However, the platform acknowledged that revenue growth “has slowed considerably,” indicating difficulties in increasing its revenue related to the relatively high household penetration, when including the large number of shared accounts, combined with the competition. ” We are not growing revenue as fast as we would like, “admitted the company, which is looking at ways to monetize those families who enjoy the Netflix service through shared accounts, which the company estimates at around 100 million additional potential users. Speaking of which, Netflix co-CEO Reed Hastings admitted during a conference with analysts that the company is considering launching a low-cost plan that would include displaying advertisements. “It’s not a short-term solution. because once you start offering a low-priced plan with ads as an option, some consumers will take it. And we have a large installed base that is likely very happy where they are, “the executive said, noting that in terms of potential for profit, the online advertising market has been moving forward. “We’re probably not that far ahead, but no, I think it’s pretty clear it’s working for Hulu. Disney is doing it. Hbo did. I don’t think we have much doubt it’s working,” added Hastings. “So I think we’re going to really get in,” he said, making it clear that users who prefer to enjoy the ad-free service will still be able to, while paying a lower price for ad-free viewing will also be possible.