Netflix Lost 2,00,000 Customers, And Will Lose More: Here’s Why

Netflix suffered heavy customer losses in the last quarter. The popular streaming platform has lost over 2,00,000 Netflix users in the past three months. Popular reasons for this abrupt departure include Netflix’s crackdown on account sharing by its users. Despite such a massive decline in the userbase, the company is still churning decent profits.

What do the numbers say?

The competition isn’t getting any leaner, and past years prove that. Netflix has several rival streaming platforms working tirelessly to snatch its customer base. Netflix told its shareholders in a letter that the number of active users declined by 2,00,000 in the last quarter. The current total number of paying subscribers is 221.64 million. In contrast, Netflix had 221.84 Netflix users.

However, this decline isn’t final. The company expects the numbers to tank further in the coming months. Going by its projections, the number of paying subscribers could shrink to 219.64 million. It would be an almost 2 million loss of paying users for the streaming platform.

Reasons behind the exodus of 2,00,000 Netflix users

Netflix shared the reasons behind the decline in subscribers in a letter to shareholders. An excerpt from the letter states, “Our relatively high household penetration – when including many household sharing accounts – combined with competition, is creating revenue growth headwinds.”

In a nutshell, the company claimed that Netflix achieved a saturation point in customer acquisition. Thus, it had very few or no more new customers to acquire.

Netflix also blamed the existing competition from Hulu, Disney Plus, and other streaming services, which stagnated its growth. These platforms are one of the reasons why Netflix users may be flocking to other platforms.

As per the stats of the shareholder’s letter, Netflix currently occupies 6.4% of the total US TV streaming time. YouTube stood at 5.7%, while Hulu and Disney Plus were at 3% and 1.7%, respectively. Disney plus recently suffered a missing episodes glitch which troubled many users.

But the reason for the tanking Netflix users count doesn’t end here. Netflix also claimed that additional 100 million users were leeching off the company’s subscriber base. However, Netflix supports account sharing, and it was the bait for a group of friends collectively using the platform.

Netflix seems to blame the account sharing for the drop in customer base, which seems wrong. It even plans to crack down on password sharing and add new measures to curb it. You can read the full letter to shareholders here.