streaming services
Netflix stock plummets more than 20 percent
The Netflix app on the display of an iPhone SE. The company’s stock has tumbled. Photo: Silas Stein/dpa
© dpa-infocom GmbH
Despite high-profile productions, Netflix fails to shine with investors. The streaming service is struggling with declining customer numbers and missing its sales expectations.
Streaming market leader Netflix had to cope with a quarter of customer dwindling for the first time in more than a decade.
In the three months to the end of March, around 200,000 subscribers were unsubscribed, as Netflix announced on Tuesday after the US stock market closed. The number of paid subscriptions worldwide was 221.6 million at the end of the quarter. According to its own forecast, the company had actually expected an increase of 2.5 million customers.
Investors reacted massively disappointed to the quarterly report – the stock initially fell by more than 20 percent in the after-hours trading. Since the beginning of the year, the price has already fallen by more than 40 percent.
Ukraine war a factor
Among other things, Netflix blamed the withdrawal from Russia, where all customer accounts were deactivated because of the war of aggression against Ukraine, for the weak numbers. Sales also fell short of expectations at $7.9 billion – despite an increase of around ten percent over the previous year. Profits fell by about six percent to 1.6 billion dollars (1.5 billion euros).
It was particularly bad on the stock market that Netflix expects to lose subscribers in the current quarter as well, given the increasing competition in streaming. And this time the minus should be even bigger with around two million customer accounts. The streaming service actually has strong productions at the start with new seasons of hit series like “Stranger Things” and top-class films like “The Gray Man” with Hollywood star Ryan Gosling.