China’s Netflix model advocates are no longer a benchmark.
On April 19, the US streaming media giant Netflix (Netflix) released its first quarter financial report for fiscal year 2022.
The outside world pays attention to its user data as usual, and this time Netflix’s answer has surprised everyone.
The financial report shows that in the first quarter, its global paying users lost 200,000. Previously, the company expected to add 2.5 million. This is the first wave of “unsubscribes” for this star company in 11 years.
Not only that, Netflix’s revenue of US$7.868 billion in the first quarter also fell short of expectations, and the growth rate returned to a new low since 2014.
Along with the growth rate, there is naturally the love of Wall Street. After the earnings report was released, Netflix’s stock price erased 25% directly after the market, hitting a new low since the end of December 2018. This year, its stock price has fallen by 43.4%, the worst performance among the FAANG star technology stocks.
No one expected Netflix’s sudden drop, because it is so different from the company’s recent content perception: Netflix has brought “Squid Game”, “Single is Hell” and “Dawn of Lights” in the past year. Waiting for the popular models, in the Chinese market where it does not serve, they are frequently screened.
Premium content did not lead to user growth, which Netflix said was due to “the geopolitical events of the Russian-Ukrainian conflict and the rise in subscription prices in North America.” But what the outside world is more worried about is actually the competitiveness of Netflix under the increasingly fierce competition.
Since the epidemic, more and more traditional entertainment companies have begun to enter streaming services, including YouTube, Amazon, Disney+ and other rivals are all competing for Netflix’s user time. There are also a lot of explosive models from rivals, and subscribers such as Disney and Apple have not declined.
Source: Nielsen
Netflix’s situation today is destined to make China’s streaming media industry feel at ease, and the question of “who is China’s Netflix”, which was once red-faced, instantly became embarrassing. Chinese disciples of Netflix such as Tencent Video, iQiyi and Youku, as well as investors who almost only use the Netflix model to value and promote the industry, have found that the fantasy of “burning money – user growth – more payment – profit” , was broken by Netflix himself.
It may be that there are still people who are looking forward to it. Netflix also said this time that it is expected that the global paying users will continue to decrease by 2 million in the second quarter.
The business of streaming media is too difficult.
edit/irisz
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