Why is Netflix losing money and why did its shares go from $700 to $213
Netflix, the world's largest streaming service, is losing money, real bad, and it’s the first time the streaming giant reported losing paid subscribers in more than a decade.
Netflix lost 200,000 subscribers last quarter and expects to lose 2 million more.
There might be various reasons for this. One might be that countries across the world are finally recovering, and reducing all the COVID restrictions.
Last year, the company saw a huge rise in the number of users, but now it’s a different story.
But also, the Russian-Ukraine tensions have played a big role and affected Netflix as well. The suspension of their service in Russia caused a total loss of 700,00 paid subscribers.
Netflix’s stock is actually plummeting at the time of writing this.
The giant is down by -58.20% in the last twelve months, but that’s even fine until you compare the current price to the 52-week high of $700.00, in November and December last year.
Read that again, Netflix’s stock plummeted in only 52-week, from $700.00 in December 2021 to $213.60 in April 2022.
This might be a big concern for all the stakeholders and buyers, but it might also be the best ever time to grab a portion of the share.
How is Netflix surviving this
Netflix was even before this, known to offer various discounts just in order to keep subscribers on the platform. And they are doubling down on this.
CEO Reed Hastings said that they are also now open to experimenting with lower-cost packages, which basically means — ads. 🤯
“Those that have followed Netflix know that I’ve been against the complexity of advertising and a big fan of the simplicity of subscription.”
said Reed Hastings, adding
“But as much as I’m a fan of that, I’m a bigger fan of consumer choice. And allowing consumers who would like to have a lower price and are advertising-tolerant, get what they want, makes a lot of sense.”
Considering this open talk, the stocks dipping, and Netflix losing customers — it almost seems inevitable that Netflix will introduce ads, which might be very shocking considering the streaming giant was for years the go-to channel for premium quality streaming for many of us.
This is going to affect most of us in one way or another. But it definitely might be the best time to invest in Netflix.
Do you have more info on why Netflix is losing money and customers? Let us all know down in the comments!