Netflix has reported its largest quarterly loss in the company’s history as thousands of TV and film fans have given up their subscriptions.
The streaming service announced its changes over the quarter ending 30 June in a letter sent to shareholders yesterday (19 July), in which it also laid out its plans and expectations for the next three months, spanning July, August and September.
Netflix expressed hopes to add one million subscribers in the third quarter, after previously having predicted it would lose two million subscribers in the quarter ending 30 June.
In reality, the company reported a loss of 970,000 subscribers - less than half the two million predicted, but still its biggest quarterly loss to date.
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The news came as Netflix's stock was on a decline of approximately 70 percent in 2021, with its market valuation decreasing from $300 billion to under $90 billion in less than a year. However, after announcing it had lost less subscribers than predicted, Netflix shares increased by 8 percent.
The company expressed belief that slowing revenue growth was down to 'connected TV adoption, account sharing, competition, and macro factors such as sluggish economic growth', and shared plans to address them by continuing to 'improve all aspects of Netflix'.
"This focus on improving our core service has served us well over the past 25 years, and remains our north star to drive continuous growth. It’s why we strive for an ever better content, marketing and product experience," the company said.
Netflix cited the success of Stranger Things 4 as proof of 'the effectiveness of our marketing strategy in driving
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conversation around our titles', noting that Kate Bush's song 'Running Up That Hill' shot to the top of the charts following the series release in June.
The company also referenced its place in relation to competitors such as Disney+, saying: "The cumulative Twitter volume for Stranger Things continues to outpace both Obi-Wan Kenobi and Top Gun Maverick, highlighting the big conversation around this title and reinforcing that our binge versus one week at a time release strategy drives lots of “water cooler conversation.”
As part of its plans for the future, Netflix announced that it will be rolling out an ad-supported subscription early in 2023, as well as testing an 'add a home' feature which will charge an extra $3 (£2.50) to share accounts with other households.
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In the quarter ending 30 June, Netflix reported having a total of 220.67 million subscribers.
Featured Image Credit: AlamyTopics: Netflix, TV and Film