In its second quarterly report on Tuesday, Netflix released “better-than-expected” results, which showed the streaming service only lost about half of the two million subscribers initially expected.
The report indicates that approximately 970,000 subscribers canceled their membership during the previous 90 days.
The better-than-expected number comes after the service took a massive hit in the first quarter when it lost 200,000 subscribers between January and March.
Big surge for $NFLX in AH – jumping almost 8% after a 'beat' on subs saw the streaming giant only lose 970k in Q2, but eyeing a 1mn gain (plus FX headwinds) in Q3. https://t.co/0GDN7jEIJf pic.twitter.com/pcaxHOAE7x
— R “Ray” Wang 王瑞光 R.NFT #1A #Metaverse RuleTheWorld (@rwang0) July 20, 2022
However, despite beating estimates, the company still saw its most significant loss in customers since its foundation 25 years ago.
“If there was a single thing, we might say ‘Stranger Things,'” Hastings said. “But again, we are talking about losing 1 million instead of losing 2 million.”
“So our excitement is tempered by the less bad results,” he added.
The company currently boasts about 220 million subscribers. Its leadership has said accelerating revenue growth has presented a big challenge. This week’s report indicates that the company will add another million subscribers by the third quarter of 2022.
“We’ve been through hard times before,” the company said in its shareholder letter. “We’ve built this company to be flexible and adaptable, and this will be a great test for us and our high-performance culture.”
The company blamed the loss of subscribers last quarter on competing with other popular streaming services.
With a looming global recession, soaring inflation, and the war in Ukraine as significant factors, Netflix leaders warned shareholders that as the US dollar strengthens and global currencies weaken, the historic pace could disrupt its international market, which makes up about 60% of the company’s revenue.
The company has laid off more than 450 employees and lost roughly 70% of its stock value so far this year.