Netflix has announced that it has lost one million subscribers in its second quarter.
The news comes a week after the streamer named Microsoft as its technology and sales partner to help power the streaming giant’s first ad-supported subscription plan.
While this is the second quarter in a row that Netflix has seen its subscribers drop, it is an improvement on the loss of 2 million subscribers the company projected last quarter.
The announcement will undoubtedly affect the streaming giant’s plans to implement ads with the intention of providing a cheaper ad-tier subscription.
Co-CEO Reed Hastings put the suprisingly higher than expected subscriber figures down to the success of the latest series of Stranger Things.
READ MORE: Reactions: Will Netflix’s plans to implement ads work?
“If there was a single thing, we might say Stranger Things,” Hastings said.
A letter to the firm’s investors said: “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 monetise our big audience.”
Missing analysts’ forecasts of £6.7 billion, Netflix’s total revenue for the first quarter of 2022 was £6.6 billion. The streamer has also had its shares fall by 67% this year.
The new ad-tier announced in April, plans to offset the loss in subscribers due to the fact that many people have opted to ditch the service due to a hike in price most recently.
Investing.com senior analyst Jesse Cohen told The Guardian: “We expect advertisers seeking the chance to reach younger viewers who have abandoned traditional television will likely allocate a greater part of their marketing budget to advertise on Netflix in the future.”
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