Netflix loses 400K subscribers in US, Canada, blames COVID-19 for 'lumpiness' in growth

Netflix loses 400K subscribers in US, Canada, blames COVID-19 for 'lumpiness' in growth

Netflix said Tuesday that it lost more than 400,000 subscribers in the United States and Canada in the most recent quarter, blaming COVID-19 for “lumpiness” in growth.

In a letter to shareholders, the company said it added more than 1.5 million subscribers overall in the second quarter of 2021, up from its forecast of 1 million.

By comparison, the streaming giant added 4 million subscribers in the first quarter of 2021, the company said in April, down from the 6 million it predicted to hit.

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The Asia-Pacific region accounted for two-thirds of its new subscribers in the second quarter, as paid memberships in the United States and Canada were down by about 430,000.

“COVID has created some lumpiness in our membership growth,” the company said, referring to higher growth last year resulting from lockdowns caused by the pandemic. The company is experiencing slower growth this year. 

Overall, Netflix finished the second quarter with 209 million paid memberships, and its total revenue sits at $7.3 billion.

The streaming giant said it expects to add 3.5 million subscribers in the third quarter of 2021, up from 2.2 million in the same quarter last year.

The numbers come as competitors seek to partner up to form media companies formidable to Netflix.

WarnerMedia and Discovery Inc. announced plans to merge in May. Amazon also announced in May that it will buy MGM for $8.45 billion.

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Netflix said it hasn’t found any opportunities to merge that it needed to act on.

“While we are continually evaluating opportunities, we don’t view any assets as ‘must-have’ and we haven’t yet found any large scale ones to be sufficiently compelling to act upon,” the company said.

However, the streaming giant said it is in the “early stages” of expanding into games, which it views as a “new category” similar to its expansion into original films and unscripted television.

“Since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games,” the company said.