While the US stock market is actually on a four day upward streak this week, the same cannot be said for Netflix's stock price. The streaming video and DVD mail order company took a massive 19 percent stock drop in trading on Thursday. CNN reports that in mid July Netflix's stock price was just over $300 a share. Today its stock price is down to just $169 a share.
The big stock price drop on Thursday was due to Netflix admitting that it would lose a total of 1 million of its subscribers in its current quarter. Last July, the company announced that its customers who use both the streaming video feature and the DVD mail order service would see their monthly prices go up by 60 percent. That action caused many of Netflix's subscribers to express their displeasure via Twitter, Facebook and message boards. At the time financial analysts were unfazed by the news. That's not the case anymore.
Netflix received another large bit of bad news earlier this month when the pay cable TV service Starz announced that it would not renew its current deal with Netflix to provide streaming video versions of its library of movies and television shows. Anthony DiClemente, an Internet and media analyst at Barclays Capital, says, "There may be a renewed sense of urgency for Netflix to go out to acquire film and TV content to replace Starz." The big question is whether this loss of subscribers is just a blip or if it is a sign of things to come for Netflix's customer base.