Netflix revealed it lost nearly 1 million subscribers in 2022’s second quarter, but the company called it a win and saw its stock jump following the news. In a call with investors, CEO Reed Hastings said that despite the losses, the company is sitting pretty since, as he believes, linear TV will be dead in “5 to 10 years,” the Verge reported.
The streaming service saw its largest ever customer drop-off from April to June this year with 970,000 accounts closed, the Associated Press said. However, the company had expected to lose 2 million subscribers following a first-quarter loss of 200,000. The news pleased investors and the company’s stock ticked up 7% in after-hours trading.
In a call with investors, Hastings admitted that “it’s tough losing a million subscribers and calling it a success,” but he wasn’t worried, claiming that, in a decade or less, normal TV would be dead.
“It’s definitely the end of linear TV over the next five to 10 years,” the Netflix chief said.
The company backed up the CEO’s claim with data in a letter to shareholders that said “in the U.S., which is one of the most competitive markets in the world, we drew more TV viewing time than any other outlet during the 2021-22 TV season nearly matching the combined total of the two most watched broadcast networks,” Variety reported.
A post from Nelson showed that streaming currently makes up 33.7% of TV viewing, while broadcast and cable make up 57.5%. Forecasters at Insider Intelligence predict digital video will overtake TV by 2024.
Hastings added, “And, as Nielsen will announce on Thursday, our share of U.S. TV viewing reached an all-time high of 7.7% in June (vs. 6.6% in June 2021), demonstrating our ability to grow our engagement share as we continue to improve our service.”
The Nielsen report showed Netflix to be the nation’s No. 1 streamer, garnering 7.7% of American TV viewing and easily outpacing YouTube (6.9%), Hulu (3.3%), and Amazon (2.9%).
