Netflix plumets 25% after hours after hours after disappointing quarterly results.

US streaming giant Netflix (NFLX) has seen its share price fall spectacularly after regular trading hours as the market released poor quarterly results.

The concern for the company and the market concern is the first loss of subscribers in a decade. NFLX’s user base dropped by 200,000 and is expected to drop further by 2 million in the next period. This was a dramatic drop from the 2.5 million subscriber gain that the company had expected. It is also the fourth time in the last 5 quarters that NFLX’s subscriber growth has fallen below the gains of the previous quarter.  NFLX blamed much of the drop on increased competition and banning operations in Russia which saw it lose 700,000 subscribers. Netflix has already increased its fees which makes it the most expensive streaming service. However, it is still the largest streaming platform with more than 221 million subscribers.

The Netflix CEO announced plans for the company to introduce advertisements for lower-cost plans at a different level than its current subscription. In what has been a constant point of difference for the company, the leadership of NFLX conceded that to continue its growth it will need to introduce advertisements to the platform. It plans on integrating adverts into the platform over the next two years. This is in line with some of its competitors such as Disney Plus, Hulu, HBO Max, and others who provide a cheaper service.

The NFLX share price has taken a beating in recent times dropping almost 67% from its highs of $700 in 2021 to $257 at its most recent after hours close. The market has not reacted kindly to the recent inflationary and competition pressures that NFLX has faced, and the next period may be a bumpy path for NFLX.