Netflix Lost Almost a MILLION Subscribers. But That's a GOOD Thing?

If you’ve been following the news from the streaming service world, you may know that Netflix has been struggling lately.

©Netflix

The streaming service has been in the news recently because of announcements like the service could soon start charging for password sharing. Netflix also recently laid off hundreds of employees in June, following the layoff of an additional 150 employees in May. In April, Netflix announced the biggest subscriber loss in 10 years, and now, we have another update on the future of the platform.

On Tuesday, Netflix held its second quarter earnings call, where it reported that the service lost 970,000 subscribers, according to CNN. This number is much lower than the original estimate, which hypothesized that it would lose 2 million subscribers in the second quarter.

©Netflix

The lost subscribers are mostly in the United States and Canada, where Netflix says it lost 1.3 million users in the second quarter. These losses, however, are offset by gains in subscribers in other countries. With the losses expected to be much worse, investors were actually pleased with these numbers, and shares increased yesterday by as much as 8% in after-hours trading. Experts believe this may give Netflix the time it needs to reassess and bounce back.

‘Emily in Paris’ ©Netflix

So what staunched the loss of subscribers in the second quarter? Experts believe that the fourth season of Stranger Things may have had something to do with it. About the show, Netflix said: “In its first four weeks, Stranger Things season four generated 1.3 billion hours viewed, making it our biggest season of English [language] TV ever.”

‘Stranger Things’ ©Netflix

Netflix also announced that the ad-supported version of their service will be expected to release in early 2023, a bit later than the original estimate that we could see ads on Netflix this year.

While the number of lost subscribers for Netflix is lower than expected, the company needs to start seeing growth in order to keep up with its competitors. One big competitor for Netflix is Disney+, which is continuing to see growth with each subsequent fiscal quarter. With Disney+ expected to have more subscribers than Netflix by 2026, Netflix is looking to “accelerate our revenue and membership growth by continuing to improve our product, content, and marketing.”

©Disney

Ad-based subscriptions are also coming to Disney+ later this year domestically, with the expectation that cheaper, ad-supported plans will be available internationally in early 2023.

Looking for something new to watch? You’ll soon be able to watch ‘Lightyear’ on Disney+ and the Universal movie Minions: The Rise of Gru is breaking box office records.