Netflix has lost subscribers in the U.S. and Canada, but there is no sign of recovery
Netflix lost 430,000 subscribers in the United States and Canada in the second quarter and released disappointing forecasts for later this year, rekindling investor doubts about how streaming media groups will perform after the economy reopens.
The California-based company expects to add 3.5 million users in the third quarter, disappointing investors who are expecting a strong rebound in the second half of this year. Analysts had predicted that Netflix will add 5.9 million subscribers in the third quarter.
The stock fell 1.4% in after-hours trading.
The California company added 1.5 million users in the second quarter, slightly higher than Wall Street’s forecast of 1.1 million users.
After adding a record number of customers last year, subscriber growth slowed sharply as new competitors entered the market and people escaped the pandemic blockade.
In the United States, Netflix’s largest market, new registrations have ceased, and most of the coronavirus restrictions there have been lifted.
“The pandemic has brought unusual volatility to our growth,” the company’s management told shareholders.
Netflix co-CEO Reed Hastings (Reed Hastings) rejected concerns about competitive threats. According to data company Ampere, in the past year and a half, Disney, Apple, WarnerMedia, Comcast, etc. have launched streaming media platforms, and there are currently more than 100 streaming media services to choose from.
Instead, Netflix executives blamed the reduction in the supply of shows and movies, and promised that with the return of content such as the following, growth will pick up in the second half of 2021 That wizard with Sex education.
“Covid and its variants make it difficult to predict the future, but production has been basically smooth so far, and we are optimistic that we can provide a strong second half [shows],” the company said on Tuesday.
Despite this, Netflix is still the largest paid video streaming service to date, with 209 million subscribers, while its closest competitor, Disney Plus, has 104 million subscribers.
Revenue in the second quarter increased 19% from the same period last year, reaching $7.3 billion, in line with analysts’ forecasts. Net income increased from US$720 a year ago to US$1.4 billion.