Netflix’s shares have fallen 25% in extended trading after the company reported its first membership decline in more than a decade, raising concerns that the pioneering streaming service may have seen its greatest days.
According to the company’s quarterly results report released Tuesday, the company’s client base declined by 200,000 subscribers from January to March. It’s the first time Netflix’s subscriber base has declined since the streaming service became widely available outside of China six years ago. This year’s dip was attributed in part to Netflix’s decision to withdraw from Russia in protest of the war in Ukraine, which resulted in a 700,000-subscriber loss.
Netflix’s first quarter profit was $1.6 billion, down from $1.7 billion in the year-earlier quarter. Revenue jumped nearly 10%, to $7.9 billion.
Despite this, Netflix is forecasting a 2 million subscriber drop between April-June, indicating that its troubles are deep-seated.
If the company’s decline continues into Wednesday’s regular trading day, Netflix’s stock would have lost more than half of its value this year, wiping out approximately $150 billion in shareholder wealth in less than four months.
Netflix’s subscriber growth has now slipped below that of the prior year for the fourth time in the last five quarters. Now, investors are concerned that its streaming service may suffer a setback as it competes with well-funded rivals such as Apple and Walt Disney.
Netflix had previously claimed that it will regain its momentum, but it is now admitting that it is in the midst of a catastrophic crisis that demands immediate attention. Netflix has indicated that it will likely crackdown on the sharing of customer passwords, which has allowed numerous households to utilise a single account to access its service.
Ahad Raza Mir to be Part of Netflix Series “Resident Evil”
According to the Los Gatos, California-based corporation, over 100 million homes globally utilise the same account, including 30 million in the United States and Canada – its largest market.
Netflix has indicated that it may expand a test launched last month in Chile, Peru, and Costa Rica that allows subscribers to add up to two individuals living outside their households to their accounts for an extra charge of $2.99 USD to stop the practice and encourage more people to pay for their own accounts.
- Misleading Video Alters Prime Minister Shehbaz’s Speech Targeting Political Rival, Not His Party - 21/04/2024
- ATC Grants Three-Day Remand for Suspects in Ichhra Bazaar Harassment Case - 19/03/2024
- Pakistan, India, and Bangladesh Lead World in Severe Smog Crisis, Exceeding WHO Guidelines - 19/03/2024
