Netflix shareholders sue company for failing to reveal growth slowdown
Netflix Inc shareholders filed a lawsuit accusing the company for failing to reveal its slowing growth amid stiff competition in the market.
• The shareholders seek damages for decline in Netflix’s share price
Netflix Inc (NASDAQ: NFLX) shareholders filed a lawsuit accusing the company for failing to reveal its slowing growth amid stiff competition in the market.
According to the lawsuit, the shareholders seek damages for decline in Netflix’s share price after the entertainment giant lost 200,000 subscribers in the last quarter.
The lawsuit filed in San Francisco federal court blames top executives including Co-Chief Executives Reed Hastings and Ted Sarandos and Chief Financial Officer Spencer Neumann.
Netflix reported loss of subscribers for the first time in more than a decade in the first quarter of 2022. Netflix said that due to suspension of its services in Russia, the company lost 700,000 subscribers.
The company also said that the performance was affected due to stiff competition from other platforms and password sharing.
The streaming company forecasted a global paid subscriber loss of 2 million for the second quarter as well.
Shares of the company have plunged since its quarterly reports.
Picture Credits: Reuters
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