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Netflix Loses $40 Billion, Considers Ads

Just a few hours ago, Netflix’s quarterly report revealed that the company has lost a total of $40 billion dollars. In the number of subscriptions they’ve forecast, they estimate a subscription loss of about 200,000.

Ukraine War, Loss of Russian Subscribers

Netflix points the cause of the loss in subscription and the dip in the share value to several factors. Sabi ng CEO na si Reed Hastings, they lost about 700,000 members due to the Russia-Ukraine conflict.

Hindi lang Netflix ang apektado in terms of subscription loss and market share value. Other streaming services such as Disney+, Roku, and Warner Bros. Discovery. Their shares dropped in value by 5%, 6% and 3.5% respectively.

This isn’t the first time Netflix lost subscription count, with the last occurrence going back to October 2011. The dip actually started early this year, around the third week of January.

Netflix’s Solution

To recover from the loss, the CEO said the company might implement ads for lower tier subscriptions. Hastings also added that ad-supported streaming services work for other companies like HBO and Disney.

Netflix is also focusing on other countries for local-language content, since the US market has matured (or reached saturation).

However, data from analytics from institutions like Digital Media Trends have found out that a majority of the Gen Z population spend more time playing games, and this may present a challenge for Netflix’s goal for increased growth.

To recount, the company has released a statement before that half of the homes in the world don’t pay for a Netflix subscription yet, so there’s room for more growth. This is in stark contrast to the situation presented by Digital Media Trends.

And it’s not only games that take Gen Z’s attention away from streaming services. Tiktok, currently the world’s most popular short-form content creation and streaming app, has a global DAU of 15 million in 2022.

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