The subscribers' strength is weakening and Netflix is blaming the crowded smart TV market that has led to fierce competition, inflation and Russia's invasion of Ukraine. These factors have contributed to a significant loss of subscribers and the figure is for the first time in about a decade. Its fortune highly thrived during the COVID-19 pandemic and experts predict deeper losses in the near future.
In the first quarter of 2022, it lost about 200,000 subscribers. The company had a forecast of adding about 2.5 million subscribers in the period. Netflix suspended its services in Russia and this led to a loss of about 700,000 subscribers.
The streaming company has lost about fifty percent of its value following a January warning of weak subscriber growth. Its stocks declined by 26 percent. It is learned a lower-priced subscription version is on the card to overcome the growing crisis and simultaneously equip the plan with advertising. Similar offerings have been successful with Disney and HBO Max.
However, many experts believe the step may land nowhere as the platform will not be equipped with the simplicity of subscription.
Earlier, in the spring quarter, the company had hinted about losing 2 million members even though popular anticipated series like Ozark and Stranger Things are making a return. Moreover, The Grey Man is debuting on the platform.
The COVID-19 pandemic period was noisy and it was difficult for the company to predict the surge. It is now working hard when the growth has slowed down. The first-quarter revenue was up by 10 percent to $7.87 billion and net earnings per share were $3.53, more than the estimates of Wall Street.
Netflix spent about $50 billion in 2021 on new content to retain subscribers. The budget was an increase by 50 percent from 2019.