Trending Stocks
  • NVDA
    184.43 1.53%
  • TSLA
    891.92 0.04%
  • SP500
    4119.04 -0.28%
  • FB
    184.02 -6.43%
  • MSFT
    278.04 -0.97%
  • BRKA
    444694.47 -1.56%
  • T
    18.73 -0.27%
  • ADBE
    411.13 0.24%
  • MMM
    143.37 0.08%
  • AMZN
    135.4 0.33%
  • AAPL
    161.53 -0.62%
  • NFLX
    226.23 0.58%

Netflix lost nearly a million subscribers in Q2

The drop was expected to be as high as 2,000,000, so half are viewed positively by investors and the stock is rising.

Netflix shares are experiencing a very volatile period. Even though in the last month the shares of this streaming giant have appreciated by more than 26%, they are still down more than 45% in 6 months.

Among other situations, the company’s first-quarter report was a big catalyst for the problems. There, for the first time since 2011, the company posted a loss of 200,000 users, which investors took hard.

“Netflix” logo displayed, with the Netflix home page in the background

Read also: Goldman Sachs reported a profit decline in Q2

Looking ahead to the second quarter, the company had warned some time ago that it would lose even more users in the second quarter than in the first. That has indeed happened and the company has now reported a loss of nearly 1 million users. However, since a loss of 2 million users was expected, the market took this news positively and the stock is up over 7% today.

So Netflix ended up losing fewer users than expected. When asked what caused this slowdown, the company’s chief executive Reed Hastings replied.

“If there was a single thing, we might say ‘Stranger Things.”

Netflix weighed down by the unfavorable dollar exchange rate

As in the reports from other companies we’ve informed you about over the past few days, Netflix has also voiced complaints about the strong dollar and thus unfavorable exchange rates from foreign currencies. In fact, more than 60% of the company’s revenue comes from abroad. Despite these problems, however, Netflix made a net profit of $1.44 billion.

Netflix expects sales in the next quarter

In the third quarter, however, the company expects to reverse this trend and is already expecting an increase in users. The company expects this to be an increase of 1 million users.

At the same time, the company is focusing on the previously mentioned password-sharing problem. In some countries in Central and South America, the company already charges higher fees for account sharing. So it hopes to roll out the model worldwide. However, the company has known about this problem for several years and still hasn’t been able to resolve it. At the same time, after the latest slight increase in the price of its subscriptions, the company already has to be very careful with its price moves.

Bruno is an Investment enthusiast with several years of experience in the industry. He enjoys following the latest news and technology trends...

Comments

Post has no comment yet.

Want add your comment? Sign up or Sign in