Netflix Is Losing New Subscribers At Alarming Rate
Netflix is losing a ton of subscribers and even more could be quitting the streaming service. What's happening and why are folks leaving?
With the streaming wars heating up over the last couple of years especially, there is a massive battle happening over where people are putting their money when it comes to subscriptions. Seeing as how the number of subscribers is almost 1:1 tied to stock prices for these companies, the reporting around who gained or lost over financial quarters becomes some of the most important for companies like Netflix. And that streamer has had some disturbing reports this year with the chance that the numbers don’t improve anytime soon. In fact, they could start getting a whole lot worse for Netflix before it’s all said and done.
According to reporting coming from Vox, Netflix lost 200,000 subscribers through the first three months of 2022 and there could be more bleeding as the year goes on. There are some expectations that Netflix will churn off another two million subscribers for the second quarter. These numbers come via Antenna which tracks the tendencies of consumers when it comes to subscription services, noting the spending habits in these fields. It’s painting a bleak picture for Netflix which appears to be struggling in the competition among streaming services vying for limited consumer dollars.
And additionally, Vox has it that even folks who are signing up for Netflix seem to be quickly regretting the decision. Apparently, 23% of those who signed up for Netflix this year were dropping it within a month. The reason for this kind of churn wasn’t given, though it doesn’t take a massive leap of logic to figure out why. Essentially, customers are signing up for the service and quickly finding there’s not much of anything that’s going to keep them around for the long haul. Or they are getting it for one or two particular pieces of content, binging it, and then ditching the service. Whatever it is, this isn’t anything close to a viable market for Netflix to continue growing, and investors are rightfully concerned.
Netflix’s stock price has been hammered this year, seeing massive losses over the first six months of 2022. It started the year trading at right around $597 dollars a share. But at the time of this writing, that number was down to around $178 a share. While not the whole dip, mid-April saw a bloodbath of a selloff for the streamer when the shares dipped drastically, shaving off nearly 50% in just a single day. While the economy and stock market as a whole have seen a plunge, these numbers are still a sharp fall by comparison.
Increasing subscription fees, elevated competition, seasons of popular shows being spread out among multiple viewing windows, the threat of ads, decreased popular offerings, and other factors are likely all at play with why Netflix is losing so many subscribers. Though the streamer is still a behemoth in the industry, it does seem clear that they’ve lost some of their hold here and it could get worse over time. The next Netflix earnings call could be more bad news for investors in the streamer.