Netflix CEO Reed Hastings said in April the company was open to adding commercials to the service, shocking the media and advertising industry. Hastings for years refused to put commercials on the platform.
“Those who have followed Netflix know that I’ve been against the complexity of advertising and a big fan of the simplicity of subscription. But as much as I’m a fan of that, I’m a bigger fan of consumer choice,” Hastings said on the post-earnings call last month. “And allowing consumers who like to have a lower price, and are advertising tolerant, get what they want makes a lot of sense.”
Yet the news spooked investors, leading Netflix stock down 1% following the report. Shares had been higher prior to the New York Times story.
The subscriber loss and bad guidance have led investors to question the future growth of Netflix and even the entire streaming business.