In a nutshell, Netflix hit a wall in terms of growing its subscriber base far sooner than it - or Wall Street - ever expected. I wrote about some of these on Tuesday, but none of them explain away the real problem for the streamer. Yes, there are some mitigating factors that explain how things got so bad so fast - everything from the way COVID clouded the true state of the streamer’s business over the last two years to the effects of more recent external factors, such as inflation and the Russian invasion of Ukraine. This is clearly the biggest crisis for Netflix since company founder Reed Hastings tried to spin off streaming into the ill-fated Qwikster back in 2011, and there is simply no way to spin it otherwise. As streaming evangelist Rich Greenfield of Lightshed put it in a report for clients, “Netflix felt vulnerable yesterday in a way that it never has before.” (It has since dropped another 4 percent today.) The news was so grim, even longtime Netflix bulls had no choice but to concede the tech company that ate Hollywood now finds itself grappling with the reality that its decade of unchecked growth has come crashing to a halt. ![]() ![]() Schadenfreude via emoji may sting, but it’s the least of Netflix’s problems right now: Its stock price collapsed by more than 35 percent Wednesday, erasing more than $50 billion in value in a single day. Twenty minutes after Netflix announced the shocking news Tuesday that for the first time in a decade, it actually lost subscribers during a fiscal quarter, an executive at a rival streamer texted me a very simple reaction: “□□□,” he wrote. Photo-Illustration: Vulture Photo by Steve Dietl/Netflix
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