Netflix Stock Is Going Down and It’s Worrying Investors

Netflix stock plunges by more than 19% sending Wall Street into a frenzy. Trade pundits are second-guessing their optimism in the subscription model.



Netflix had a disappointing subscriber growth during the last three months in 2021, and this brought major concern for the CEOs of the company. This trend continues in 2022, and it is a huge problem for Netflix, mainly because of the harsh competition.

The company gained 8.3 million worldwide users in the last three months of the last year, and this is the number that is not good enough for Netflix officials. They expected 200,000 more subscribers worldwide. The result of this decrease affected the Netflix stock price, which is now less than expected.

When it comes to the number of subscribers, Netflix projected an increase of 2.5 million in the first three months of the year. This is far less than 4 million subscribers, which is the number of analysts and their expectations.

Netflix stock value is expected to plunge by about 20%, and the major fall has already happened during the past few months. The main reason for the decline is the news about the Netflix subscribers numbers, and this is something to consider as the most relevant thing when it comes to the value of the Netflix stock.

Netflix Stock prices

During the lockdown in 2020, Netflix gained more than 36 million subscribers, and this was the peak of the subscribers’ growth. Many people were locked in their homes, and they turned to streaming services to spend more quality time at home.

What was good in 2020 was not that good in 2021. Netflix attracted 18.2 million subscribers in 2021, and this was the slowest growth in the period of five years. At the moment, the service has more than 222 million subscribers, which is the biggest number when compared to all other rivals.

Other competitors like Apple and Walt Disney Co. also fight for their share in the market, and they offer some of the most popular services. This was one of the reasons why Netflix offered video games last year as part of the services. The Netflix rivals attract the attention of many people and they represent true competition.

No matter the competition, the Netflix officials emphasize their service is still the leading one in most of the countries where Netflix is available. They also mention that competitors have a marginal effect on the growth of Netflix services.

Netflix executives said the company was affected by the pandemic last year, and the Covid-19 created a lot of misfortunes. Despite the lower subscribers number, the company had good financial standing last quarter, and they earned $607 million. Netflix shares were at the price of $1.33 per share, and this was the 12% increase when compared to the same period the previous year. The revenue in the fourth quarter was $7.7 billion, which was the revenue that rose by 16%.

On the other hand, the investors are worried that Netflix is reaching its peak in popularity and they believe the investment will not be smart in the future. They turn to other services, and the Netflix competitors get the advantage in popularity among investors.

The opportunities for the future growth of the service are difficult in the major markets, the U.S. and Canada. This is the situation that affects all service providers. Those who are interested in Netflix are already having the account at their homes, and in 2021, there were 75.2 million subscribers in the U.S. and Canada.

Netflix is facing possible account cancellation because they raised their price by about 10% this year, and many people are not satisfied with this decision. This prediction about possible cancellation is based on the previous price hikes when Netflix changed its prices rapidly.

Christy Gren
Christy Gren is an Industry Specialist Reporter at Industry Leaders Magazine she enjoys writing about Unicorns, Silicon Valley, Startups, Business Leaders and Innovators. Her articles provide an insight about the Power Players in the field of Technology, Auto, Manufacturing, and F&B.

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