Netflix loses almost a million subscribers, but it’s a good thing. Here’s why

Although this seems like a high number, this is not the first time that Netflix has lost such a drastic number of subscribers. In the last quarter, Netflix saw a drastic drop in subscribers when they lost 200,000, which caused mayhem in the stock market. The news was so shocking that it forced many organizations to reevaluate the company’s current and future economic conditions.

Netflix isn’t worried about losing subscribers

Netflix released their quarterly report on Tuesday, July 19, in which they reported the loss of 970,000 subscribers for the second quarter. However, they’re relieved to see this number. According to The Washington Post, the company predicted the loss of 2 million subscribers from April 1 to June 30, which would really harm the economic condition of the company.

But given the current number, they’re relieved to see that they lost less than half the number of predicted subscribers. Consequently, this resulted in a boost in the company’s stock prices which increased by nearly 8% more, as investors rushed to grab this opportunity.

What does this mean for the future?

The subscriber count was hit the hardest in Netflix’s major markets of the US and Canada. Despite the loss of almost a million subscribers, the company is optimistic about recovering the current loss. As reported by CNN Business, they put out a statement:

Our challenge and opportunity is to accelerate our revenue and membership growth by continuing to improve our product, content, and marketing as we've done for the last 25 years, and to better monetize our big audience

We're in a position of strength given our $30 billion-plus in revenue, $6 billion in operating profit last year, growing free cash flow and a strong balance sheet.

Read more:

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⋙ Netflix to lay off 150 employees following first subscriber loss in a decade

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