On today’s earnings call, Netflix CFO Spence Newman reassured investors that, despite the company’s projections for a 2 million subscriber drop in the coming quarter, they should expect subscription growth to resume in the second half of the year.
“I want to make sure that there isn’t a read-through from negative two million paid net adds in Q2 that there will be a steady strip-down of negative adds,” Newman said. “We don’t expect revenue growth to pick up before the end of the year, but we will grow revenue and paid net add growth.”
As we get into the second half of the year, Ted mentioned the stronger slate, getting further away from some of the big price increases, and entering a stronger seasonal period, so I just want to make sure that’s understood as you think about the full year, even though we’re not providing full-year guidance.”
Previously, Newman stated that at least some of the subscriber decline was caused not only by the suspension of service in Russia, but also by a “spillover effect” in other parts of the EMEAA region, particularly in other Central and Eastern European countries.
Elsewhere on the call, Netflix executives provided additional context to some of the Q1 earnings revelations. Early in the call, co-CEO Reed Hastings addressed password sharing monetization, stating that Netflix had been aware of password sharing for some time, but that subscription and revenue growth had been so significant up to this point that it wasn’t an issue they were ready to address. With acquisition and growth declining, Netflix believes it is time to exit.
