In its latest financial results, Netflix reported a decrease in the number of subscribers in the first quarter of 2023 in Latin America. Having lost 450,000, the OTT closed the period with 41.25 million customers. It is the second time in Netflix’s history that the company has reported a loss of subscribers at the end of a quarter. The first time was in Q1 2022, exactly one year ago.
According to Netflix’s, the dip is due to a natural shrinkage following a significant growth in the fourth quarter of 2022, when the subscriber count increased by 1.76 million. It was in Q4 2022 that the OTT reached its peak in Latin America with a total of 41.70 million users.
On a global scale, the platform closed Q1 2023 with 232.5 million paid members, having increased its subscriber count by 1.75 million.
In its presentation, Netflix also announced its intention to advance in the implementation of its crackdown on account sharing during the second quarter of the current year. In fact, it is planning a “broad rollout”, which will include the United States. The company put the system in practice for the first time in Costa Rica, Chile and Peru in March 2022. Then it introduced it in Argentina, El Salvador, Guatemala, Honduras and Dominican Republic in August 2022 and in Canada, New Zealand, Spain and Portugal in early 2023. With the exception of the phase including Argentina, El Salvador, Guatemala, Honduras and Dominican Republic, where the system was cancelled less than two months after its implementation, the company expressed satisfaction with the results.
In the presentation, Netflix explained the following: “We’re pleased with the results of our Q1 launches in Canada, New Zealand, Spain and Portugal, strengthening our confidence that we have the right approach. As with Latin America, we see a cancel reaction in each market when we announce the news, which impacts near term member growth. But as borrowers start to activate their own accounts and existing members add extra member accounts, we see increased acquisition and revenue.”
Finally, Netflix announced that it will no longer rent movies on physical DVDs, which was originally the main business of the company. The service is still available in the United States but it will be discontinued as from September 2023.
