Netflix Loses 200K Subscribers in Q1 2022, Expects 2 Million Subscriber Loss Next Quarter
In the first quarter of 2022, Netflix lost approximately 200,000 subscribers globally, dropping its total number of subscribers to 221.64 million. In the United States and Canada alone, the streaming service lost 640,000 customers. Those users likely balked at the recent price hike.
Netflix also took a hit after ending operations in Russia following the country’s invasion of Ukraine. That stand cost Netflix 700,000 Russian accounts.
The company says that without the suspension of service in Russia, there would have been an overall 500,000 subscriber increase during the quarter.
The subscriber total results in a year-over-year increase of 14.04 million subscribers as in Q1 of 2021 — the company's worst quarter since 2013 — Netflix topped out with 207.6 million users. Netflix had been forecasting an addition of 2.5 million new accounts for Q1, but was significantly off from that projection. With their new report, the company has issued guidance that the platform was likely to lose 2 million customers in Q2.
When Netflix revealed subscriber data following Q4 2021, the streamer boasted 221.84 million subscribers globally on the strength of 8.28 million additions in the final three months of last year. That number was up 16% year-over-year when it had roughly 203 million subscribers at the end of 2020.
The first quarter of 2022 saw a number of strategic changes for Netflix. In January, the streamer raised its prices on all new U.S. and Canadian subscribers. The most basic plan increased by $1 to $9.99 per month, while the standard option went from $13.99 to $15.49 and the premium 4K plan jumped $2 to $20. The company also announced that these prices will gradually take effect for existing subscribers as well.
Given the service’s ubiquity, especially in the U.S., a number of people — from industry insiders to customers — have begun to push for Netflix to add a lower-cost, ad-supported tier in order to entice more budget-conscious consumers to subscribe. Given that only 2.4% of the streamer's customers churn every month — the best total in the industry by 1.3% — it could benefit Netflix to do whatever it can to get people to sign up and then to allow the platform’s content to keep them engaged.
While in the past, the company had considered advertising the third rail of its business model, last month, Chief Financial Officer Spencer Neumann said that the streaming giant is not unilaterally opposed to the idea of introducing an ad-supported option to provide customers with a lower-priced entry point to the service, but that it is not likely to happen any time soon. “It’s not like we have religion against advertising to be clear,” Neumann said. “But for now it doesn’t make sense for us.”
Whether it will make more or less sense after the numbers and guidance announced today remains to be seen.
In March, Netflix launched a test in Chile, Costa Rica, and Peru in order to convert viewers who were sharing the password of another customer’s account into paid subscriptions of their own. Over the past month, there has been no confirmation as to when, or if, that pilot will rollout worldwide or domestically.
Unlike when the company announced its Q1 2021 figures, the slate of upcoming content has been mostly unencumbered by pandemic delays. On the series front, the streamer will release a number of high-profile shows in Q2, most notably the first part of “Stranger Things” Season 4 on May 27. Also releasing soon is Part 2 of the final season of “Ozark” on April 29 (the same day that the final season of “Grace and Frankie” drops), Season 2 of “Russian Doll” on April 20, “The Umbrella Academy” Season 3 on June 22.
New films still to hit the service this quarter include “The Pentaverate” starring Mike Myers (as multiple characters), Keegan-Michael Key, Ken Jeong, and Jeremy Irons. This conspiracy-theory comedy drops on May 5. Then, “Operation Mincemeat” will hit the service on May 11 led by Matthew Macfadyen and Colin Firth, and on June 10, the Adam Sandler basketball movie “Hustle” will come to Netflix.
Still slated for release this year are exciting titles “Escape from Spiderhead.” The film stars Chris Hemsworth, Miles Teller, and Jurnee Smollett and will give George Saunders fans something to look forward to.
Another upcoming title is the live-action adaptation of Neil Gaiman’s iconic graphic novel “The Sandman.” Also coming to the platform is “The Gray Man” which will be released in the summer and features A-listers Ryan Gosling and Chris Evans. This also marks the first blockbuster that the Russo brothers have directed since “Avengers: Endgame.”
In Q1 2022, the streamer also continued to invest in video games as a way to keep customers engaged with their service and as a way to generate new content and franchises.
Netflix
Netflix is a subscription video streaming service that includes on-demand access to 3,000+ movies, 2,000+ TV Shows, and Netflix Originals like Stranger Things, Squid Game, The Crown, Tiger King, and Bridgerton. They are constantly adding new shows and movies. Some of their Academy Award-winning exclusives include Roma, Marriage Story, Mank, and Ma Rainey’s Black Bottom.