Netflix reported that it lost 970,000 subscribers from April to June, avoiding the worst case scenario projected by the company, but offered a forecast below Wall Street’s expectations for the current quarter.
The company plans to launch an ad-supported service next year and has warned that the strong dollar is also hurting revenue from subscribers outside the United States.
Netflix he had warned in April that he expected lose 2 million customers in the current quartershocking Wall Street and raising questions about its long-term growth prospects.
While second quarter defections were not as pronounced as expected, Netflix it estimated that its new customer additions between July and September would number 1 million. Wall Street was expecting 1.84 million, according to analysts polled by Refinitiv.
After years of great growth, the luck of Netflix has been reversed as its competitors, such as Walt Disney, Warner Bros Discovery and Apple, which they invest heavily in their own streaming services.
In a letter to shareholders, the company said it had further examined the slowdown, which it attributed to a number of factors, including shared passwords, competition and a weak economy.
Netflix remains the dominant streaming service worldwidewith almost 221 million paying subscribers on the planet.
In April, the company said it was addressing customer churn in part by planning a crackdown on password sharing and launching a cheaper ad-supported subscription.
In the past week, Netflix announced that Microsoft is its new sales and technology partner for its ad-supported service.
The company is also working to build on the popularity of the “Stranger Things” series and try to turn some of its biggest hits into franchises.
From April to June, earnings per share were $3.20.
Netflix He said the dollar’s strength weighed on revenue, which grew 9%. Revenues would have increased 13% without the impact of foreign exchange, the company said.