Netflix Just Lost a Ton of Subscribers

Netflix not only failed to meet its subscriber growth goals in the first quarter of 2022 – it lost about 200,000 subscribers. The streamer reviewed Q1 in an earnings release on Tuesday, which said that it had dropped from 221.84 million subscribers at the end of 2021 to 221.64 million on March 31. However, much of that loss is due to Netflix’s decision to cut service in Russia in protest of the invasion of Ukraine.

This is the first time in a decade that Netflix has lost subscribers rather than gaining them in a financial quarter. What’s worse is that this quarter included the premiere of the highly anticipated Bridgerton Season 2, among other projects. According to a report by Variety, Netflix expects to lose as many as 2 million more subscribers in the second quarter of 2022. However, the company notes that many of these losses come down to the global political situation, including the Russian invasion of Ukraine.

Netflix’s earnings report says that many of the losses in Q1 stem from its decision to cut services throughout all of Russia when the Russian military invaded Ukraine. It says that, discounting the situation Russia, Netflix actually would have reported an increase of 500,000 subscribers this quarter, not a loss. However, this also means that an ongoing military situation is sure to show more strain on Netflix – and perhaps other digital businesses as well.

Regardless, it’s clear that war isn’t Netflix’s only problem.The company had set a goal to gain 2.5 million subscribers in Q1, so even without the invasion, it would have fallen far short. Netflix blames the stagnant growth on password-sharing – an issue that the streamer has plans to crack down on – and increased competition from other major services.

“We’ve got to compete, and we’ve got to continue to improve on the core service which is making TV series and films and now games that people really love,” said Netflix co-CEO Ted Sarandos. “That’s what we’re really focused on and that’s a thing we can continue to grow the business in. Now, we talked about being highly penetrated in some of those core markets with users, which means that it’s harder to get them to join Netflix if they are already using Netflix. So we’ve got to figure out these different models that we’re doing now to more effectively monetize that viewing.”

Netflix has various plans in the works to tackle its slow growth over the next year, including a possible low-cost ad-supported tier. It may even scale back its investments in new original content. Of course, over on social media fans are not being shy about giving their own opinions.