The streaming giant explained that this drop was mainly linked to the difficulty of acquiring new subscribers in all regions of the world, but also to the suspension of the service in Russia.

The industry pioneer had inflated numbers during the Covid-19 pandemic.

The market expected a correction, but not as strong.

Its title fell by 26% in electronic trading after the closing of the New York Stock Exchange.

Netflix had expected to gain an additional 2.5 million subscribers - and analysts were expecting even more - but instead lost some, bringing its total down to 221.64 million subscriptions.

"The suspension of our service in Russia and the gradual decrease in the number of Russian paying subscribers resulted in a net loss of 700,000 subscriptions. Without this impact, we would have had 500,000 additional subscriptions" compared to the last quarter, the company said. California in its earnings release.

Video games

In all, Netflix made $7.9 billion in revenue from January to March, almost 10% more than a year ago, thanks in particular to the increase in the number of subscribers on a year (+6.7%) and the increase in its prices.

But it generated 1.6 billion in net profit, less than the 1.7 billion in the first quarter of 2021.

The fact that many households share their account and the increased competition "create obstacles to our growth. The rise of streaming thanks to the Covid had masked the reality until recently", underlined the group.

"Netflix's loss of subscribers is very telling for a company that has been steadily gaining subscribers for an entire decade," said eMarketer analyst Ross Benes.

"With declining subscriptions and weak growth prospects, Netflix will have to rely more on secondary branches, such as video games or derivative products to try to grow its revenues," he added.

After years of conquering users at high speed, and awards at festivals, the company was joined by strong competitors, like Disney+ and Apple TV+ at the end of 2019.

It then sought to diversify its sources of income, particularly in the lucrative market of video games.

In September, Netflix acquired its first video game studio, Night School Studio, a California start-up that created the supernatural thriller Oxenfree.

In November, it launched several mobile games for its subscribers, including some inspired by the universe of the science fiction and horror series "Stranger Things".

No more account sharing

More recently, the American group undertook to tighten the screw on the side of the sharing of identifiers, which allows many people not to pay for access to the platform.

Netflix announced in early March that it would conduct tests in South American countries to charge its customers for adding additional profiles to their account.

Sharing passwords between households "affects our ability to invest in quality series and movies for our members," Chengyi Long, director of product innovation at Netflix, said in a statement.

On Tuesday, the company assured that it was counting on these measures, and improvements in its service in general, to “reaccelerate the growth” of its income.

“People love movies, TV shows and games; high-speed internet and connected TVs continue to advance around the world with more and more connected devices; and while hundreds of millions of households pay for Netflix, more than half of broadband-connected households don't yet, representing huge potential for future growth," Netflix notes.

© 2022 AFP