Shareholders of the streaming giant Netflix filed a lawsuit against it on Tuesday, according to media reports, as the company downplayed events such as account sharing, increased competition and user churn, drawing anger among shareholders.
In mid-April, Netflix informed shareholders that its revenue growth “decelerated substantially” in the first quarter of 2022, as 200,000 users worldwide cancelled their subscriptions to the service.
Netflix also predicted at the time that it could lose as many as 2 million subscribers in the second quarter.
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In a new lawsuit, shareholders are seeking stock damages that fell sharply for failing to meet their subscriber growth goals.
Shareholders claim they were knowingly misled by Netflix, writing in the complaint: “As a result of defendant’s (Netflix’s) misconduct and omission, and the dramatic decline in the market value of the company’s securities, plaintiffs and other class members have suffered significant Loss and Damage”.
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