Netflix ends year with 222 million subscribers
Subscription growth slows down, with the streamer attributing it to “added competition” from other companies with streaming services
Netflix fell short of its projections for new subscribers this quarter, adding 8.3 million subscribers as opposed to its expected net subscriber addition of 8.5 million.
In a shareholder letter issued last quarter, the streaming giant had already said that it was expecting to underperform in Q4 compared to growth seen between 2017 to 2020.
The streaming giant ended 2021 with a total of 221.8 million subscribers. It added just 18 million new paying subscribers during the year compared to the 37 million gained in 2020.
Most of the 8.3 million subscriptions added at the end of last year came from outside North America.
Netflix’s revenue rose 16% to $7.7 billion in the fourth quarter, compared with a year ago. The company’s net income was $607 million or $1.33 per diluted share, beating analysts’ expectations.
For the full year, Netflix’s revenue increased 19% to nearly $29.7 billion. Net income was $5.1 billion in 2021, compared with $2.76 billion in 2020.
In a letter issued to shareholders on Thursday, Netflix acknowledged that “added competition” from other companies with streaming services “may be affecting [Netflix’s] marginal growth some”.
“Consumers have always had many choices when it comes to their entertainment time — competition that has only intensified over the last 24 months as entertainment companies all around the world develop their own streaming offering,” the company wrote in its letter.
"While retention and engagement remain healthy, acquisition growth has not yet re-accelerated to pre-Covid levels," Netflix reported.
"We think this may be due to several factors including the ongoing Covid overhang and macro-economic hardship in several parts of the world," it added.
The streamer has predicted slower growth for the first quater of 2022, forecasting 2.5 million subscriber adds.
About 2021 content slate, Netflix said season two of The Witcher was its top series title released in the fourth quarter, raking up 484 million hours of viewing worldwide in its first 28 days, while Maid (469 million hours) and season three of You (468 million hours) also had strong showings. Netflix also noted that Squid Game, released late in the third quarter, is its most-watched series ever. The Korean series amassed 1.65 billion hours of watch time worldwide in its first four weeks of release.
