Netflix loses subscribers – blames password sharers

Netflix loses subscribers – blames password sharers
Netflix loses subscribers - blames password sharers 1

In a letter to shareholders Netflix announced late on Tuesday night that the company’s growth has slowed down and that it has for the first time lost paying subscribers. The news caused the share price to fall sharply during trading – at the time of writing it is down 25 percent.

Netflix had 221.84 million subscribers in the fourth quarter of 2021, but lost about 200,000 subscribers in the first quarter of this year. In addition, the company expects to lose upwards of two million users during the current quarter.

Revenues are still growing, but at a slower pace than before. A year ago, they increased by 24 percent per year, today the same figure is just under 10 percent.

There are several reasons for the slowdown. Among other things, Netflix blames the many users who share their accounts with others – over 100 million households use someone else’s account, according to the company. Increased competition and external factors such as Russia’s invasion of Ukraine are also said to have had an impact.

Netflix also writes that it looked like an incipient slowdown in 2021 was due to the fact that it had grown so fast in 2020 when the covid pandemic began.

The company hopes to reverse the trend by investing more in content quality and better recommendations, to get viewers more engaged.

Netflix loses subscribers - blames password sharers 1

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