Once a Wall Street Darling, Netflix now in raw form; Tuesday crucial for streaming Giant
New York: Netflix, once a darling of Wall Street, is suddenly on the ropes, media reports say. The streaming giant will report its second-quarter earnings on Tuesday and it will be one of the most dramatic moments in the company’s 25-year history, the CNN reported. Also Read – Microsoft, Apple, Google and many more : List of companies planning to freeze hiring, lay off employees
Netflix is having a terrible year. In April, the company reported that it had lost subscribers in the first quarter of 2022 — the first time it had happened in a quarter in more than a decade. Shares of Netflix then went up in flames, it’s fallen about 70 percent so far this year, wiping out billions of dollars in market value, and the company has laid off hundreds of employees. Also Read – Netflix Loses Nearly 1 Million Subscribers in Q2; Aims to launch a cheaper ad-supported plan soon
Tuesday is crucial, not just for Netflix, but for the entire streaming industry
Losing subscribers wasn’t the only problem that rocked the Netflix world. The weak outlook for the second quarter shocked investors. Netflix predicted it would lose another 2 million in the spring, CNN reported. Whatever happens on Tuesday could change the future of the company and the entire streaming industry. As Netflix goes, so does streaming. “There will be hell to pay if they report a number significantly higher than the 2 million loss being thrown around,” Andrew Hare, senior vice president of research at Magid, told CNN Business. Also Read – What Are The Top Brands For Hackers To Steal People’s Data Through Phishing?
So what lies ahead for the platform now?
Netflix is pinning its hopes on a potential savior: advertising. The company announced Wednesday that it is partnering with Microsoft on a new, cheaper, ad-supported subscription. Despite Netflix’s CEO Reed Hastings having been allergic to the idea for years, advertising is now an important part of Netflix’s plans to increase revenue in the future. The new tier is reportedly set to arrive before the end of 2022, but Netflix admits its burgeoning advertising activity is still in its “very early days.”
The company also focuses on reducing password sharing and creating compelling content to help turn the tide. But will that matter if Tuesday’s numbers are so lackluster that Wall Street is completely turning its back on Netflix? “Once Netflix is severely undervalued by the market, all bets are off,” Hare told CNN.