The company said it had 970,000 fewer customers in the period, having warned in April that the number could expand to two million as a number of challenges faced the business. However, it said it predicted a return to subscriber growth in the current quarter. That effort will be supported starting next year, Netflix said, through the launch of a new cheaper ad-supported service and through new multi-household contracts. The earnings report covering the second quarter to the end of June was eagerly awaited by investors after a bloodbath for its stock when it reported a shock drop – the first in a decade – in its subscriber base between January and March. The number of customers then fell by 200,000 when the company expected an increase of 2.5 million new customers. The numbers would have been in positive territory but for Netflix’s decision to suspend services in Russia in retaliation for the war in Ukraine. But shares fell 40% after Netflix predicted it would continue to bleed subscribers amid tough competition and pressure on household disposable income across its markets from rising inflation. Netflix has responded to the revenue squeeze by raising prices in key markets, including the US and UK, and restricting people from sharing passwords with other households. Use Chrome browser for more accessible video player April 1:44: What Netflix should do after the “shock” of subscribers As part of those efforts, the Squid Game and Stranger Things streamer has moved to create a multi-household subscription offering that will launch in South and Central America. It is also working with Microsoft to create the cheapest program that will contain ads to reduce costs for consumers. Revenue from March to June came in at just under $8 billion – well short of analysts’ lowest expectations. The shares, which have lost two-thirds of their value this year amid a retreat in so-called growth stocks in general amid high inflation, rose more than 5 percent in official trading on Tuesday. Up to 8% up on after-hours deals. The company told shareholders in a letter: “Our challenge and opportunity is to accelerate our revenue and membership growth by continuing to improve our product, content and marketing as we have done for the past 25 years, and to create better revenue from our large audience. .” This is expected to include the popularity of Stranger Things, which Netflix has said it is looking to turn into a franchise.
