Netflix Hit With Shareholder Lawsuit Amid Plummeting Stock Price
Photo by Venti Views on Unsplash

Netflix Hit With Shareholder Lawsuit Amid Plummeting Stock Price

The fallout from Netflix’s disastrous first-quarter earnings continues with a new shareholder lawsuit that claims the streaming giant misled investors about its ability to sign up more subscribers.

According to Reuters, a Texas-based investment trust has accused Netflix and its leaders of failing to disclose its slowing growth and that it was shedding subscribers as it amid heightened streaming competition. The lawsuit, filed Tuesday in federal court in San Francisco, is seeking monetary damages for the sharp drop in Netflix's share price after the company missed its subscriber projections.

Netflix shares cratered last month after investors learned that the streaming platform had lost subscribers for the first time in more than a decade in the first quarter, and expects to lose 2 million more in the current second quarter. The company’s stock price plummeted more than 35% on April 20, the day after Netflix disclosed its first quarter financial results. Netflix shares closed at $204.01 on Wednesday, a mighty fall from their nearly $700 stock price in November.

During Netflix’s most recent earnings call, company leaders blamed increased competition, password sharing and Russia’s invasion of Ukraine, among other factors, for the sharp subscriber slowdown. Executives claimed that COVID-19 had initially clouded the company’s outlook for future growth.

The lawsuit names Netflix co-CEOs Reed Hastings and Ted Sarandos and Chief Financial Officer Spencer Neumann as defendants, according to Reuters. The suit, which is seeking class-action status, was filed on behalf of investors who traded Netflix shares between Oct. 19, 2021 and April 19, 2022.

Subscribe to our newsletter to catch every headline.

Drew Grant in Lensa AI art
Drew Grant

It took me 48 hours to realize Lensa might have a problem.

“Is that my left arm or my boob?” I asked my boyfriend, which is not what I’d consider a GREAT question to have to ask when using photo editing software.

“Huh,” my boyfriend said. “Well, it has a nipple.”

Well then.

Read moreShow less
Drew Grant

Drew Grant is dot.LA's Senior Editor. She's a media veteran with over 15-plus years covering entertainment and local journalism. During her tenure at The New York Observer, she founded one of their most popular verticals, tvDownload, and transitioned from generalist to Senior Editor of Entertainment and Culture, overseeing a freelance contributor network and ushering in the paper's redesign. More recently, she was Senior Editor of Special Projects at Collider, a writer for RottenTomatoes streaming series on Peacock and a consulting editor at RealClearLife, Ranker and GritDaily. You can find her across all social media platforms as @Videodrew and send tips to

PG&E Is Seeking EV Owners for Its New Program to Sell Energy Back to the Grid
Photo courtesy of Ford

Pacific Gas and Electric is in the midst of enrolling customers into an ambitious new pilot program that seeks to use electric car vehicles as a means of powering daily life and stabilizing the grid.

The “Vehicle to Everything” pilot envisions a future in which automobiles not only draw their power from the electrical grid but can also strategically add electricity back in when demand is high — and generate some money for their owners along the way.

Read moreShow less
David Shultz

David Shultz reports on clean technology and electric vehicles, among other industries, for dot.LA. His writing has appeared in The Atlantic, Outside, Nautilus and many other publications.