DR. SAVOD

Or How I Learned to Stop Worrying and Love the Ad

Happy Friday War & Peaceniks!

On April 1, I predicted that Netflix saw a substantial uptick in Churn in Q1 due to their price increase, and that’s what caused their sub loss in 1Q. This week we found out if that was true.

This chart tracks Netflix’s Gross, Cancelled and Net Added Subscribers each quarter. 

The data is from Antenna (a great resource for streaming insights), and based on millions of actual banking transactions, not polls or panels. You can see that in 1Q Netflix, saw their biggest number of quarterly cancellations ever, yet did not increase Gross Adds. Antenna reports (as I predicted) that Netflix’s Churn (a metric I have long decried the absence of in earnings reports and on analyst calls) jumped 33% from 2.2% to 3.3%, and that Netflix lost more than 600K subscribers in April.

Netflix themselves projected a net loss of 2 million subs in 2Q. Which means their monthly churn is likely staying that high or increasing. Even more concerning, Netflix’s longest standing subs are …