Netflix Inc said inflation, the war in Ukraine and fierce competition contributed to a loss of subscribers for the first time in more than a decade and predicted more contraction ahead.
The headwinds facing Netflix pummeled other video streaming-related stocks, with Roku dropping over 6%, Walt Disney falling 5% and Warner Bros Discovery down 3.5%.
In addition to advertising-supported plans, the company is also looking to generate additional revenue from customers who share their account with friends or family outside their home. In addition to the paying households, Netflix is being watched by an additional 100 million households that it said were sharing accounts, including 30 million in the United States and Canada. As penetration has increased, the number of shared accounts has become a bigger problem.“They suffered from a combination of approaching saturation, inflation, higher pricing, the war in Ukraine and competition,” said Wedbush analyst Michael Pachter.
Netflix noted that despite the intensifying competition, its share of TV viewing in the United States has held steady according to Nielsen, a mark of subscriber satisfaction and retention.As growth slows in mature markets like the United States, Netflix is increasingly focused on other parts of the world and investing in local-language content.
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