Company expects to lose 2 million more over the next quarter as subscribers rethink commitment to streaming services
A number of rival services, including Disney, Warner Bros Discovery and Paramount, often with deeper content libraries to draw on, have also entered the market. Netflix stock, which was already down 40% for the year, has now dropped from $700 in November to $244 when the market opened, a fall approaching two-thirds.
“We’re definitely feeling higher levels of market penetration … and heightened competition,” said Ted Sarandos, co-chief executive. The confluence of negative forces, from the lifting of the pandemic, the loss of 700,000 subscribers in Russia, high consumer inflation in many leading markets forcing households to rethink their budgets, have hit the service.
Wednesday’s crash comes after a period of spectacular growth for the company coupled with investors demand for the stock. Netflix, like Peloton and GameStop, was a beneficiary of cash that flushed through economies during the pandemic, feeding demand for stocks.Reed Hastings, co-chief executive, said tackling account sharing is now a priority for the company. An estimated 100m households are using accounts that they do not pay for.
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