- Netflix lost 970,000 subscribers between April and June.
- The company predicted that it would add 1 million new customers from July through September.
- Microsoft was named last week as Netflix’s technology and sales partner for the ad-supported service.
Netflix Inc. reported on Tuesday that it lost 970,000 subscribers between April and June, avoiding the worst-case scenario anticipated by the business, but provided a prediction for the current quarter that was below Wall Street estimates. It announced its plans to introduce an ad-supported tier the following year and issued a warning that the strong currency was also having an impact on the revenue booked from customers abroad.
Netflix had given an April warning that it anticipated losing 2 million users in the upcoming quarter, startling Wall Street and casting doubt on its prospects for long-term development. Although the second quarter’s defections were not as severe as anticipated, Netflix predicted that it would add 1 million new customers from July through September. According to analysts surveyed by Refinitiv, Wall Street analysts had 1.84 million on their radar.
Netflix’s prospects have changed after years of explosive expansion as competitors like Apple Inc., Warner Bros. Discovery, and Walt Disney Co. spend aggressively in their own streaming services.
The business said in a letter to shareholders that it had looked into the slowdown in more detail and had determined that it was caused by a number of variables, including password sharing, competition, and a weak economy. With approximately 221 million paid subscribers worldwide, Netflix continues to be the most popular streaming service.
The business announced in April that one of the ways it was addressing customer churn was by preparing to cut down on password sharing and introducing the less priced tier with advertising. Microsoft Corp. was named last week as Netflix’s technology and sales partner for the ad-supported service. Netflix said that despite income increasing by 9%, the strong dollar hurt them. Without the effects of foreign exchange, revenue would have risen by 13%, according to the corporation.
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