Netflix suffered its first subscriber loss in more than a decade, causing its shares to plunge 25% in extended trading amid concerns that the pioneering streaming service may have already seen its best days.
SAN FRANCISCO —
If the stock drop extends into Wednesday’s regular trading session, Netflix shares will have lost more than half of their value so far this year — wiping out about $150 billion in shareholder wealth in less than four months. Netflix absorbed its biggest blow since losing 800,000 subscribers in 2011 — the result of unveiled plans to begin charging separately for its then-nascent streaming service, which had been bundled for free with its traditional DVD-by-mail service. The customer backlash to that move elicited an apology from Netflix CEO Reed Hastings for botching the execution of the spin-off.
Netflix has previously predicted that it will regain its momentum, but on Tuesday faced up to the issues bogging it down. “COVID created a lot of noise on how to read the situation," Hastings said in a video conference reviewing the latest numbers. To stop the practice and prod more people to pay for their own accounts, Netflix indicated it will expandthat allows subscribers to add up to two people living outside their households to their accounts for an additional fee.
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