Netflix shares lost a quarter of their value Tuesday after the company revealed its ranks of subscribers shrank in the first quarter of this year. It was the first time in a decade that the leading streaming television service had lost subscribers.
The company said it lost 200,000 subscribers in its first quarter, falling well short of its forecast of adding 2.5 million subscribers. Suspending service in Russia after the Ukraine invasion resulted in the loss of 700,000 members. Netflix ended the first quarter of this year with 221.6 million subscribers, slightly less than the final quarter of last year.
Netflix’s 26% tumble after the bell on Tuesday erased about $40 billion of its stock market value. Since it warned in January of weak subscriber growth, the company has lost nearly half of its value.
Netflix believes that factors hampering its growth include subscribers sharing their accounts with people not living in their homes. The streaming giant estimated that while it has nearly 222 million households paying for its service, accounts are shared with more than 100 million other households not paying subscription fees.
Netflix said for the first time that it was open to the idea of offering lower-priced subscriptions with advertising. The company is also looking to generate additional revenue from customers who share their account with friends or family outside their home. “Those who have followed Netflix know that I’ve been against the complexity of advertising, and a big fan of the simplicity of subscription,” said CEO Reed Hastings. “But, as much as I’m a fan of that, I’m a bigger fan of consumer choice.”
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An entity linked to Vedanta Resources is in talks with bulge-bracket global banks to garner up to $2 billion in bridge loans to finance bond redemptions and debt repayments due for the conglomerate’s holding company and its associates over the next few months, multiple industry sources told ET.
India needs to unleash the animal spirits of the private sector and remain fiscally prudent while speeding up growth further to leverage the unique demographic dividend it enjoys, top industry executives and government officials said.
As many as seven countries will sign up with India to use India Stack’s digital public goods, minister of state for electronics and information technology Rajeev Chandrasekhar told ET.
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