Technology
Netflix loses subscribers for first time in decade; forecasts more fall
The streaming giant blamed this upset on a mix of factors including the suspension of its service in Russia due to its Ukraine invasion.
California: For the first time in a decade, Netflix lost 200,000 subscribers in the first three months of the year and predicted deeper losses ahead, marking an abrupt shift in fortune for a streaming company that thrived during the COVID-19 pandemic.
The streaming giant blamed this upset on a mix of factors including the suspension of its service in Russia due to its Ukraine invasion.
It has, furthermore, projected a loss of two million subscribers in the next quarter as against the addition of 1.5 million subscribers in the year-ago period.
The announcement, plus the company’s warning that it expected to lose two million subscribers in the second quarter, sent the stock down more than 20% in after-hours trading on Tuesday.
Company’s revenue in its first quarter of the year was up 9.8% compared with the same period last year to more than $7.8bn (£6bn).
However, the streaming platform ended its January-March period with 221.6 million subscribers.
Pulling out of Russia, a step Netflix took following the war in Ukraine, cost it 700,000 subscribers. Another 600,000 people stopped its service in the US and Canada after the price increase, said Netflix.
That marked a slowdown from earlier quarters, while profits fell more than 6% to roughly $1.6bn.
Asia was the one region that showed growth, with Japan, India and the Philippines among the countries adding subscribers.
Another factor, it said, was that in addition to the 222 million paying households, Netflix is also shared with an estimated 100 million and more additional households.
It is pertinent to mention here that Netflix, with 221.64 million subscribers, still has the largest subscriber base of all the streaming services. But the company’s slowing growth is likely to continue for the foreseeable future.