In the second-quarter earnings report, Netflix indicated that about 970,000 subscriptions were lost between April and June, marking the largest quarterly loss of users in the company's 25 year-long history. The latest loss also follows a decline of 200,000 subscribers during the first quarter of 2022, which was the first time that Netflix saw a drop in subscriptions for two consecutive quarters since adjusting their business from mail-in-DVDs to online video streaming 15 years ago.
Despite the drop in subscribers, Netflix ended June 2022 with over 220 million global subscribers, and still reported a revenue of just under 8 billion United States dollars, earning 1.4 billion USD which translates to $3.20 US per share during the latest quarter. This is a roughly 6% increase from the same period in 2021.
Although a large loss, Netflix management initially predicted in April that the company could lose an estimated 2,000,000 subscribers in the second quarter of 2022. The less severe drop in subscriptions alongside a prediction of about 1 million new or returning subscriptions in the third quarter of the year resulted in a 7% increase in stock prices during extended trading hours. However, despite the increase, Netflix's stock price is still down 63.77% (as of writing this article) since the beginning of this year, when each share was worth just shy of 600 USD.
Netflix also announced that the company will begin cracking down on password sharing early next year, and will also launch a cheaper subscription option, meaning up with Microsoft to deliver commercials.
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