Netflix stock sank 23% late Tuesday after issuing a disappointing update on its subscribership. The company said it lost 200,000 subscribers in the first quarter and expects to lose another 2 million its current quarter. It also said revenue isn’t growing as much as it would like. Loading Something is loading.
Netflix stock dropped more than 20% after hours trading on Tuesday after the streaming service posted its first loss in subscribers in a decade.
The company said it lost 200,000 subscribers in its first quarter, marking the first decline since 2011.
Shares plummeted 24% to $262.20.
Its subscriber outlook was bleak, as well, as the company forecast a loss of another 2 million in its current quarter.
It also said in the near term, it’s not growing revenue as fast as it would like.
“COVID clouded the picture by significantly increasing our growth in 2020, leading us to believe that most of our slowing growth in 2021 was due to the COVID pull forward. Now, we believe there are four main inter-related factors at work,” the company said in a earnings statement.
The four factors the company cited for its performance in the quarter include:
Growth being dependent on factors “we don’t control.” The company cited the adoption of connected smart TVs as an example.Estimates that Netflix logins are being shared across 100 million households. Huge competition, particularly in the last three years as major media brands launch their own streaming services. Macro factors. The company cited a sluggish economy, high inflation, and the war in Ukraine as having an impact on business.