Netflix Lost 970,000 Subscribers In 90 Days! But Profit Increases To Rs 11,200 Crore
During second quarter of 2022, Netflix ost 970,000 subscribers, as it reported on Tuesday.
Interestingly, this number is far lower than its own forecasts, which had projected that the streaming giant would lose two million subscribers.
Making Investors Happy
Further, the streaming service provider said that it would add another one million subscribers in the third quarter.
This number seemed to be slightly lower than Wall Street expectations.
On the other hand, investors were clearly happy with the results, and it has also reflected in Netflix shares as they jumped as much as 8% on Tuesday in after-hours trading.
While all this was happening, all eyes were on Netflix Tuesday, with Wall Street, Hollywood and the media world all hyper-focused on its subscription numbers.
Prior to this, it disclosed losing 200,000 subscribers in April, leading to a steep drop in its share price dramatically.
If we follow the numbers, Netflix’s second quarter profit came in at $1.4 billion which is up from $1.3 billion in the year-earlier quarter.
The year on year revenue jumped roughly 8.6% to $7.9 billion.
It appears that the streaming service provider’s biggest subscriber loss came from its biggest market, the United States and Canada, as it lost 1.3 million users in the second quarter.
Although, it was offset by increased subscriptions elsewhere.
Netflix said, “Our challenge and opportunity is to accelerate our revenue and membership growth by continuing to improve our product, content, and marketing as we’ve done for the last 25 years, and to better monetize our big audience,” in its letter to investors.
Further adding, “We’re in a position of strength given our $30 billion-plus in revenue, $6 billion in operating profit last year, growing free cash flow and a strong balance sheet.”
Biggest Subscriber Loss
Presently, Netflix (NFLX) needs this type of result.
In its 25-year history, the most recent quarter showed the biggest subscriber loss.
Although, it could be considered as a win for the company considering the numbers came in much lower than expected.
All the fears vanished on Tuesday as investors were pleasantly surprised that the losses weren’t worse, and cheered with the company’s projection that it will see growth in the third quarter.