Netflix has reported its first subscriber loss in more than a decade —with the company warning that it expects to lose even more in the months ahead.
Netflix lost 200,000 subscribers globally in the first quarter —far below the 2.7 million additions expected.
The company expects to lose another 2 million subscribers this current quarter, as it blamed password sharing and increased competition from rival streaming services for slowing revenue growth. Suspending its service in also Russia resulted in a loss of 700,000 subscribers.
The streaming giant reported quarterly revenue of $US7.78 billion, up 10% from last year (compared to the $US7.93 billion expected). Company stock plunged roughly 25% immediately following the first-quarter earnings report.
Netflix now has some 221.6 million paying customers globally, which is down from 221.8 million in the fourth quarter of 2021.
Estimates are that a hundred million Netflix viewers, including 30 million in the U.S. and Canada, use other peoples’ passwords to log in.
A solution will take a while to work out, likely requiring “a year of iterating and deploying” it globally, said COO Greg Peters. The idea, he suggested, isn’t to wipe out password sharing but charge people to do it. In the process, the company will be focusing more on revenue and “subscriber accounts” versus a fixation on individual subscriber numbers that drove the shares lower today.