By Zin El Abidine TAIMOURI (MAP)
Casablanca, 01/27/2022 (MAP) – On Friday January 21, at the opening of the New York Stock Exchange, Netflix’s share price plummeted. From the first exchanges of the day, the title lost nearly 22% of its value to 398.39 dollars, thus plummeting the performance of Wall Street.
At the origin of this collapse, the publication of historically low growth forecasts for the platform which expects, in the first quarter of 2022, 2.5 million new subscribers against 4 million gained from January to March 2021.
These forecasts thus constitute the most modest quarterly increase since 2010 when Netflix had only 13.9 million customers. A loss of momentum mainly due to the improvement in the health situation around the world followed by deconfinement.
After a net gain of 55 million followers over the past two years, the video streaming juggernaut now faces tough competition, including from recently launched HBO Max and Peacock TV. Netflix can therefore no longer ignore its competitors, to which are naturally added video games and social networks.
After reaching a historic peak of 700 dollars in November to fall to less than 400 dollars today, the decline in growth in prospect for the Californian group questions the specialties and the investors, some of whom are even considering the beginning of the end of a success story.
This spectacular fall, which the most optimistic consider as a simple correction, is likely to give investors chills since it has relieved the company, in a few seconds, of 40 billion of capitalization, thus erasing all the gains made in 2021. .
The distributor of blockbusters like “Squid Game” or “Emily In Paris” to 221.8 million subscribers would have lost nearly 43% of its value compared to its peak in mid-November, reports the results of the 4th quarter published last Thursday by the company.
In a rather reassuring tone, the streaming giant explained in a press release that subscriber retention and audiences remain solid, however lamenting that the growth of new subscribers has not returned to pre-pandemic levels.
Also according to the online video service, the Covid epidemic which continues to weigh on the world economy, as well as macro-economic difficulties which impact the four corners of the world, in particular Latin America.
Netflix also speculates that raising its prices by $2 in recent months could potentially have had an effect on consumer choice as inflation hits purchasing power hard across the world.
For now, the decline in the price of the platform continues. After losing nearly $110 between Thursday and Friday, Netflix’s stock price continued its descent to $387 on Monday and $366 on Tuesday before plunging to nearly $360 on Wednesday, a 5-day change of 30.06. %.
On the run and in an attempt to retain fleeing investors, the American firm announced last Thursday, in view of the depression, the second season of “Squid Game” viewed 111 million times the first week of its release in September.
A hope therefore for Netflix to fill up on subscribers and to reconnect with the 7.4 billion dollars in turnover achieved in the third quarter of 2021.
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