Netflix: Pandemic-Fueled Subscriber Growth To Reduce


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Netflix is the world’s leading video streaming app, with over 190 countries enjoying movies, TV series.

Recently, Netflix has seen a reduction in subscriber growth, sending its shares tumbling.

The streamer added 3.98 million subscribers between January and March, which is less than the projected 6 million.

According to the company, lack of new shows may have led to the shortfall. And with the release of sequels to many hit shows, it is expected to recover.

Netflix shares declined by 11% in after-hour trading to $489.28, wiping %25 billion off the company’s market capitalization.

Last year due to the pandemic people were forced to stay at home. This added another 15.8 million new subscribers.

It was in Asia that Netflix had maximum growth. It added 9.3 million new subscribers in 2020. About 65% increase over the previous year.

But the pandemic has also caused disruption in its production pipeline.

“These dynamics are also contributing to a lighter content slate in the first half of 2021, and hence, we believe slower membership growth,” the company said in its quarterly letter to shareholders.

Then in the second quarter, the company experienced very poor customer growth. It had just 1 million new subscribers, which was far less than previously estimated 5 million.

Furthermore, with the introduction of new streaming services in the market such as Disney, Apple and HBO, there is a very stiff competition.

As compared to Netflix’s 207.6 million, Disney+ already has 100 million subscribers.

Netflix generated $1.71 billion revenue, or $3.75 per share, more than doubling from a year ago. At the same time last year, this revenue increased by 24% to $7.16 billion.

In the second half of the year when Netflix releases new season of much awaited series – “You”, “Money Heist”, “The Witcher”, “Stranger Things”, “The Crown”, and “Ozark”, a stronger growth can be seen.



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