(Bloomberg) – Netflix Inc. tumbled 35% on Wednesday, in a selloff that wiped out $54 billion in market value, after it reported a surprise decline in its subscriber base.
Netflix closed at $226.19 in New York, extending its plunge this year to 62% – making it the worst performing stock in the S&P 500 and the tech-heavy Nasdaq 100 indexes. Netflix has a 0.8% weighting on the Nasdaq 100 and 0.3% on the S&P 500. The shares posted their biggest drop since October 2004.
The streaming service shocked Wall Street by losing 200,000 customers in the first quarter, the first time it has shed subscribers since 2011. It also projected it will shrink by another 2 million customers in the second quarter.
Meanwhile people suspect this indicates problems for the whole streaming industry. Too much competition, expensive new programming to attract subscribers, and too many service offerings. How do you convince subscribers to sign up for another service.
No longer a profitable growth industry. Maybe even Disney will be affected, but Cramer says they are the exception.
One service seems to be doing okay: HBO & HBO Max.
One service irritating the bejesus out of me these days is $AMZN Prime. Next time you open it up, look at how they cue movies and TV programs: always you get tossed some appetizing titles, then you click on that title to open it up to read more, and then you’re hit with “Buy or Rent from Amazon Prime, buy or rent this HULU offering.” At least on $NFLX, I know I’m not going to be hit with hidden persuaders to buy or rent what should be free offerings without ads.
On another note this morning, CNN+ is closing up shop. That didn’t last long.
* HBO and HBO Max grew to 76.8 million subscribers by the end of the first quarter of 2022.
* That’s up 3 million subscribers since the previous quarter.
* Earlier this week, Netflix reported its first subscriber loss in more than a decade.
Here we go: CNN+ lasted just one-month?
*Warner Bros. Discovery has decided to shut down CNN+ just weeks after it launched.
CNBC reported last week fewer than 10,000 people were watching CNN+ each day.
CNN+ head Andrew Morse is leaving the company.