Netflix lost 200,000 subscribers in three months and is expected to lose another 2 million

In a recent letter to shareholders, Netflix announced that its revenue growth has “slowed significantly” as 200,000 subscribers worldwide canceled their subscriptions to the service. The streaming giant expects to lose another 2 million subscribers in the second quarter of 2022.

The report then had further knock-on effects, sending Netflix shares down 24% in after-hours trading. CNN reported in January that Netflix shares had also fallen 20% in after-hours trading due to the poor outlook for future growth. In the letter, Netflix also estimated that 100 million people are using shared passwords, further undermining potential revenue. In March, the company bluntly stated that password sharing is "impacting our ability to invest in major new TV series and movies."

While Netflix has a slew of highly anticipated content this year, Stranger Things Season 4 (May 27), The Crown Season 5 (November 2022), and The Sandman (2022) don’t seem to be enough to make up for those losses and turn things around. Earlier this month, Netflix added a new “Like” option to rate content, but that’s hardly going to make a subscription any more attractive in the face of a recent price increase announced in January.

Netflix faces increasing competition from rival services, which the company acknowledged in its shareholder letter, while noting that "competition for viewing has been fierce over the past 15 years with linear TV as well as YouTube, Amazon, and Hulu," Netflix noted. "It is undeniable that over the past three years, the pandemic and people's desire for streaming content have awakened the world and traditional entertainment companies to the realization that "streaming is the future."