2022 is turning from bad to worse for the streaming service giant Netflix. In its recent report, the company announced that it has lost around 200,000 subscribers in the first quarter and is expecting to lose more than two million more in the next quarter. As a result, Netflix stock (NFLX) plunged 35% on Wednesday, causing around $50 billion in market cap loss.
Netflix stock hasn’t had a worse day since 2004 and is now already 40 percent down year to date. The trend could easily continue since the investors are worried about the growth of the company and its short-term viability. These worries are amplified by the fact that the reported loss of subscribers is the first such occurrence in more than a decade.
Some high-profile investors have already decided to move away from Netflix stock, including billionaire Bill Ackman. After making a $1.1 billion investment in Netflix three months ago, Ackman pulled out recently despite a loss of close to $400 million.
In order to address the declining subscription numbers, Netflix said it would continue improving its service and continue bringing quality content to its users. However, their efforts will also include a crackdown on password sharing while CEO Reed Hastings became more open to the advertisement possibilities as well.
