STORY: Netflix said it lost 970,000 subscribers last quarter – which is actually good news, considering that the world’s largest streaming service shocked Wall Street in April when said it expected to lose 2 million.
Netflix not only avoided that worst-case-scenario, but on Tuesday also predicted it would return to customer growth this quarter.
As a result, Netflix shares – which have fallen roughly 67% due to customer growth concerns – rose in after-hours trading.
After years of red-hot growth, the company’s fortunes changed as rivals including Disney, Warner Bros Discovery and Apple invested heavily in their own streaming services.
In a letter to shareholders on Tuesday, Netflix attributed its slowdown to a variety of factors including password-sharing, competition and a sluggish economy.
It said plans to crack down on password sharing, and will also launch a less-expensive, ad-supported option next year as a way to lure more subscribers.
Netflix is also looking to build on the success of megahit "Stranger Things", which has inspired merchandise, and now a spin-off series and a stage play are in the works. Netflix said it’s planning to give at least a dozen series and films the “Stranger Things” treatment.